Real estate sector poised for stranding year gains, say BuildingMinds and JWA
Real estate sector poised for stranding year gains, say BuildingMinds and JWA
New white paper from BuildingMinds and JWA shows the stranding year for most real estate assets could be postponed by four years with relatively low effort or investment.
Retail and office assets could push this out by nine years with capex investments; while adding renewable energy improvements would provide even greater rewards.
Meaningful progress and actionable change must combine strategic planning with operational efforts.
[London, 4th September] – A new white paper from leading real estate software-as-a-service (SaaS) company BuildingMinds, in association with leading expert in sustainability for real estate JWA, shows the significant potential for extending the economic life of real estate assets via the innovative application of sustainability and risk management initiatives.
JWA is recognized as one of Europe’s premier consulting firms specializing in sustainability for the real estate sector, having delivered sustainability and energy reporting to close to 1,000 commercial assets over the past decade, and completing more BREEAM Certifications than any other company in Europe. JWA has also been present in the Latin American market through its office in Mexico since 2023. The company’s findings show that for more than 50% of the assets assessed, the stranding year – or point when a real estate asset loses its value before the end of its expected useful and economic life – can be delayed by leveraging operational efficiencies. For these buildings, the stranding year was noted to be 2024 or even earlier, indicating many had already lost their useful value or would do so this year without intervention.
“While we noted a stranding year of 2024 or even earlier on the majority of the buildings, we also saw there was scope to push that back in almost all cases and moving the stranding year ahead by an average of four years was perfectly feasible,” said Iñaki de la Parra Chief Growth Officer, JWA. “We also saw scope for further gains. For example, in retail and office asset classes, the stranding year could often be postponed until 2035 just by making capex improvements.”
If the developments incorporate renewable energy into their operations, then the gains are even bigger. For warehousing and logistics business there’s even greater potential for advances in sustainability and ESG objectives. For these developments, highlighted savings opportunities are between 18 and 39%, depending on the benchmark against which they were measured, and these can be achieved with relatively simple actions.
The paper recommends developing a bespoke program to improve the operational performance of an individual real estate asset. But while each plan should be unique, the process should follow a familiar template, starting with benchmarking the asset’s current standing. This will help set environmental and social KPIs (that meet regulatory guidelines) and achievable sustainability goals tailored to current and future market factors. It will also enable the development of impactful strategies to achieve the goals. For the majority of developments, energy and emissions savings of up to 55% can be achieved through this process.
Real-world example
JWA and BuildingMinds highlighted the practical application of this process through a case study on the refurbishment of four office towers on the former Marynarska Business Park in Warsaw, Poland. Here JWA assessed the risks specific to the portfolio, with an emphasis on people, processes and systems, to deliver a program of improvements to build resilience against climate change and to take account of regulatory impact. The company’s innovative technical and management solutions enabled the buildings to make operational savings of almost 80% on the HVAC system, while reducing the primary energy demand by over 30%, post-refurbishment. In addition to receiving BREEAM Excellent certification, the complex received the ESG Champion Building of the Year Award at a prestigious CEEQA competition this May.
“An estimated 80-90% of the buildings that must meet 2050’s climate goals already exist, and will require a flexible, smarter approach to building systems design if they are to successfully adapt to the new patterns of work and consumption, as well as continue to deliver a useful return for their owners” concluded Marek Sacha, CEO of BuildingMinds. “Our collaboration with JWA offers a unique opportunity for the real estate sector to learn and adapt sustainability strategies, ensuring the longevity and resilience of portfolios and businesses.”
Click here to download the full whitepaper.
About BuildingMinds
BuildingMinds is a real estate software-as-a-service (SaaS) provider that offers a comprehensive, data-driven platform for optimising building performance and sustainability. Through innovative technology and analytics, BuildingMinds enables real estate owners and managers to monitor, analyse, and optimise their assets, supporting the transition to a more sustainable and data-driven real estate industry.
About JWA
We are experts in sustainable development, energy and carbon efficiency of buildings and ESG strategies for the real estate sector. We support our clients in developing innovative, energy-efficient, net zero, people-friendly and environmentally neutral buildings.
We support companies along their sustainability journey, driving their market cap and investment value. Our clients' buildings meet the growing expectations of investors and usersas a result of using cutting-edge technological solutions. As such, they comply with applicable regulations, adhere to the world's most stringent standards and prove to be future-proof.
For more information please contact:
Peter Panayi, Head of Go-To-Market, BuildingMinds,
peter.panayi@buildingminds.com, +44 7929 108 812
