A brief retrospective of initiatives
The number of activities and initiatives undertaken to achieve sustainability in the real estate sector has increased significantly in recent years. Overall, it is becoming ever more apparent that this modern way of doing business is all about a combination of environmental, economic and social factors.
The roots can be traced to the emerging environmental awareness of the late 1960s, when physician Hubert Palm won acclaim for his presentations on “building biology”. The focus was on pure ecology. A milestone for the movement came in 1968 with publication of the book entitled “Das gesunde Haus” (“The Healthy House”), which went through numerous editions up until 1992. It was only in 1976 with the German Energy Saving Act (Energieeinsparungsgesetz, EnEG) that economic factors came to the fore. The German government adopted the Act in response to the oil crisis taking place at that time. The Act remained in force in Germany for almost 30 years, astonishingly, and was not amended until 2005. The German Energy Saving Ordinance (Energieeinsparverordnung, EnEV) was introduced three years before the amendment and had a major influence on subsequent developments.
The first assessment systems
At the end of the 1980s, the idea of certifying the sustainability of a building or development project emerged in various countries. In the UK, the government-funded Building Research Establishment set up the BREEAM certification system in 1990. Initially, this scheme only applied to office properties, but its scope was later extended. The LEED rating system, which took a different approach, followed in 1998 and was aligned more closely with US standards.
Sustainability code published
In 2007, sustainability in the German real estate sector received a major boost with the establishment of the German Sustainable Building Council (DGNB). In addition to considering environmental and economic factors, the DGNB introduced a greater focus on socio-economic aspects into the discussion. Union Investment responded in 2009 by introducing its Sustainable Investment (SI) Check. In 2011, the German Property Federation (Zentraler Immobilien Ausschuss, ZIA) also published a comprehensive sustainability code, including guidelines for the real estate industry. Via a dedicated working group, the ZIA went on to develop recommendations for green leases. Union Investment was quick to embrace these recommendations and green leases became standard for all the company’s new lettings of German office properties in 2014.
Guidelines on portfolio management and social responsibility
Two examples from 2016 demonstrate the breadth and depth of engagement with sustainability in today’s real estate sector. Firstly, the German Investment and Asset Management Association (BVI) published guidelines for sustainable real estate portfolio management. Shortly afterwards, and independently of the BVI, the ZIA brought out guidelines on the real estate industry’s social responsibility, which included numerous practical examples. This shows that alongside building ecology, which has continued to develop, sustainability is now also routinely being assessed in terms of hard economic criteria as well as social aspects.
Outlook: What does the future hold?
This brief retrospective is the start of a series on current initiatives operated by different real estate industry bodies and associations. The other articles in the series will highlight what the sector is currently working on and which milestones will shortly be added to the history of sustainability.