Sustainable developments: Are they the future of real estate?

One of the most pertinent questions nowadays revolves around the future of our planet and the alarming threat that global warming and climate change have on our ecosystem. Global organisations, governments, corporations and individuals alike are becoming more aware of the environmental responsibility each one has and the need for education and action in the unified fight against climate change.

With the UAE winning the bid to host the UN Climate Change Conference, COP28, it is now more important than ever before for the region to uphold its commitment and push the agenda that sets a more sustainable economic future. The announcement was made during the largest global conference of heads of states and governments on climate and environmental issues, during the UN’s COP26 Climate Summit in Glasgow. This honour only re-affirms the UAE’s initiative to achieve ‘Net-Zero by 2050’ and drive an integrated approach for sustainable development. The country’s leaders confirmed they will be working collaboratively with the private and public sectors, to find sustainable solutions and alternatives and create incentives for economic growth.

One sector that is unmissable in this fight for change is the real estate sector. Global studies have found that the construction industry contributes to almost 40 per cent of worldwide carbon emissions. It is thus no longer a question of wanting to build green, but it has become an outspoken responsibility for all property developers to put sustainable solutions at the heart of the building process, from initiation to design and construction.

Sustainability comes at a cost and the UAE real estate sector will most certainly face challenges to achieve net-zero targets, not only due to the many older developments that require retrofitting, but also because there is still a gap in education and more importantly, legislation, to push sustainable development opportunities. All three parties within a developments’ life cycle; the developer, the contractors and the consumer, must be taught of the benefits of investing in sustainability in the long term.

Legislation on minimum acceptable green standards, new building codes, new sustainable building materials and even the use and disposal of construction waste, will be required in the immediate future. As I have always believed and we have all witnessed, if any nation can accomplish this, it is the UAE.

With more green financing initiatives, comes a bigger interest in sustainability enhancements from developers. New regulations will invite current developments to look into their operations and see how to improve their existing assets into becoming more green. Certifications such as the LEED Green Building will help entice developers to focus on key components of sustainability; from waste and water management to energy efficiency.

This in turn will give consumers the option to purchase spaces with eco-conscious features such as rooftop solar panels, low-wattage lighting systems, water-efficient landscaping, and smart technology. For instance, a residential building that uses solar panels to supplement energy consumption will have lower annual electricity bills that lead to lower annual service charges for owners and investors.

Simultaneously, developers looking at the build to rent model will also benefit, as the solar panels usually pay for themselves within six years of operations, after which it reduces the overall cost of operations for the long term. As all parties within the real estate life cycle are educated about the benefits of sustainable living, we will see more end users looking for such developments and in turn more developers, institutional investors and contractors focusing on delivering these types of projects.

With the UAE’s net zero commitment and the Dubai 2040 Urban Master Plan, the nation is well poised to be a regional leader in combating climate change and fostering growth through sustainable communities over the next 50 years.

Madhav Dhar is the co-founder and COO of ZāZEN Property Development