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Mission: Possible – How Environmental Commitments Can Help Ensure Long-Term Value

  • 28 Apr 2023
  • by
  • Warren Loy
  • Director of Asset Management, Americas
As Earth Month comes to a close, Director of Asset Management in the Americas, Warren Loy, reflects on the importance of environmental commitments to the long-term value of our projects.

Given that it is Earth Month, I’ve seen a number of posts recently about sustainability and how various organizations are making strides to reduce their carbon footprint and operate more responsibly. I’m encouraged by the increasing commitment to sustainability that I’m seeing across industries, especially real estate.

My industry – the built environment – is responsible for about 40% of global greenhouse gas emissions, so it’s critically important that we take an active role in shaping how buildings are designed and constructed to ensure the communities we create are lasting. I’m proud of how Lendlease is making a bold environmental commitment through Mission Zero – our goal of achieving absolute zero carbon across scopes 1, 2, and 3 globally by 2040 – to not only eliminate carbon emissions across our organization, but also to create a roadmap that other developers, builders and suppliers can follow.

While it’s clearly the right thing to do for the planet and its people, it also makes good business sense. Our shareholders, investment partners, employees and the communities in which we do business all value and benefit from sustainable, equitable and enduring development. From the living shoreline at Clippership Wharf, which raises and lowers with the tides and protects the area from future flood events, to the use of low-carbon concrete and steel in projects like Claremont Hall and The Reed at Southbank, we’re thoughtfully designing residential communities that will stand the test of time for generations to come. 

In my role as Director of Asset Management for an integrated real estate group, it’s become increasingly vital to demonstrate a strong global commitment to ESG principles. This means delivering and maintaining properties that prioritize sustainability in their design, construction and operation – a strategy that maximizes asset value over the long term. Today more than ever, debt and equity providers are being more selective about where they allocate resources, and many are choosing to invest only in those projects that meet stringent sustainability standards. FORUM, our new life sciences project in Boston developed in partnership with Ivanhoé Cambridge, is a great example of this principle in action. The building is designed to achieve LEED Platinum and Fitwel certification and will have net zero operations upon completion – all factors that resonate with forward looking investors. 

Faced with dire headlines about topics ranging from climate change to geopolitical instability, real estate investors are hyper-focused on how assets will perform not only today, but also in the future. They want to know that the properties in which they invest can be maintained in a way that anticipates future decarbonization requirements, as well as extreme weather events and other potential risks that might impact profitability. Some energy and operational efficiencies, such as smart thermostats, LED lighting and low-flow plumbing fixtures, are easy to implement, while others are more difficult. For example, 1 Java Street, our 834-unit mixed-use development along Brooklyn’s Greenpoint waterfront, will be all-electric and feature the largest residential geothermal heat exchange system in New York State, reducing annual carbon emissions from heating and cooling by 53% compared with typical residential systems. It’s a monumental undertaking that will not only provide benefits for this community through reduced utility costs, but it will, more importantly, demonstrate the viability of this system and encourage its use in future projects.

Finally, environmental stewardship is also rising in importance with municipal and state governments that are enacting regulations to reduce carbon footprints in their own backyard. Designing and building with an environmentally responsible mindset usually means you are ahead of the curve with building plans that already meet or exceed those criteria, thereby avoiding any costly upgrades or penalties as baseline requirements change.

If you want to learn more about how Lendlease is planning to reach absolute zero carbon by 2040 and encouraging industry partners to do the same, visit our Mission Zero page. And feel free to reach out to me personally with any questions for our team.