Sustainable development priorities faced a major switch worldwide in the past few years, as decarbonization has become the global ESG matrix. Decarbonization covers virtually all market segments, taking on the role of a pivotal pillar. Real estate is among the most active initiators towards carbon neutrality.  


Did you know?

Globally, CO2 emissions have doubled since 2000 and will continue to rise due to population and economic growth.  

  • 73% of global GHG emissions come from energy
  • The energy sector includes transportation, electricity and heat, buildings, manufacturing and construction, fugitive emissions, and other fuel combustion.
  • Cities consume 78% of the world’s primary energy. They cover 3% of the Earth global area, but generate 70% of CO2 emissions, mainly from buildings, energy, and transport.
  • Buildings and Construction account for 40% of energy related CO2 
  • As construction output increases, so does the significant emission of CO2 and methane.

In Europe, emissions decrease in most sectors, due to strict regulations. While energy supply and industry face challenges, residential and commercial buildings or waste management lead the positive trend. 

Recognizing decarbonization’s significance, stakeholders in construction face intricate challenges and set of actions, extending beyond traditional norms across energy, materials, distribution, waste, and health. For investors, the growing demand for sustainable buildings translates into enhanced values. 

In Europe, building developers and investors are setting bold objectives with daringly short timelines compared to EU’s Fit for 55 target or the 2050 goal to reach climate neutrality. Moreover, sustainable building practices took center stage in 2024, reflecting COP28‘s emphasis on decarbonization with the Buildings Breakthrough’s global push for near-zero emission and resilient buildings by 2030. 

With massive pressure worldwide regarding the reduction of CO2 emissions and the transition towards a low-carbon economy, building owners put sustainability strategies at the basis of business and decarbonization plays a major role. The set of actions to reduce carbon footprint include:  

  1. Energy Efficiency: The use of energy-saving technologies, practices, and materials is essential. This covers insulation with high performance, lighting solutions that are optimized, and heating, ventilation, and air conditioning (HVAC) systems that are advanced, designed to lower energy use while keeping comfort.
  2. Renewable Energy Integration: incorporating renewable energy sources such as solar panels, wind turbines, heat pumps, and geothermal power into the building’s energy supply to reduce reliance on fossil fuels. 
  3. Smart Building Technologies: Utilizing automation, sensors, and data analytics for energy optimization. Technologies like smart thermostats and lighting systems, alongside automated controls, work to minimize energy use without sacrificing functionality.
  4. Artificial Intelligence integration in Sustainable Building: The implementation of AI technologies in sustainable building marks a significant evolution in strategies aimed at decarbonization. AI enables more efficient energy use, predictive maintenance, and smarter building management, thereby facilitating a substantial reduction in carbon emissions.
  5. Green Building Certifications: Meeting the stricter sustainability criteria set by certifications such as LEED and BREEAM, which serve as benchmarks for sustainability construction and renovation practices.
  6. Sustainable Materials and Construction Practices: using materials with a low embodied carbon footprint, procured through sustainable sourcing. Strategies include the integration of green roofs and urban greening initiatives to enhance insulation properties and sequester CO2.
  7. Electrification of Systems: Transitioning to electric-based heating and cooling systems, supporting electric vehicle (EV) infrastructure, and other electrified solutions to phase out dependency on fossil fuels.
  8. Carbon Offset Initiatives: Compensating for the unavoidable carbon emissions through various initiatives, such as investing in external projects that capture or reduce carbon dioxide elsewhere.
  9. Circular Economy Principles: Encouraging the reuse, recycling, or repurposing of materials to minimize waste and reduce the environmental impact of construction and demolition processes associated with the lifecycle of building materials.
  10. Government Incentives and Regulations: Align building practices- construction and operation- with government incentives and regulations that promote sustainable and low-carbon practices in the real estate sector.
  11. Climate Resilience Planning and Design: Proactively addressing potential climate change challenges, including extreme weather events, and rising sea levels, through resilient architectural and engineering solutions.

By focusing on retrofitting existing buildings and implementing these strategies in new constructions, the real estate sector can make significant steps towards sustainability and decarbonization. This dual approach not only enhances the efficiency and lifespan of existing infrastructures but also paves the way for a more sustainable and resilient built environment. 

Decarbonization – Top 3 Drivers

  • Decarbonization is the global matrix 
  • Carbon footprint enhances business performance
  • AI enters as new tool in sustainable building 

These trends reflect a growing awareness and commitment within the real estate sector to contribute to broader decarbonization goals.