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Emerging Asia Leads the World in Implementing ‘Green’ Real Estate Solutions

Royal Institution of Chartered Surveyors
2011-01-26 18:06 1441

RICS Global Property Sustainability Survey, Q3 2010

HONG KONG, Jan. 26, 2011 /PRNewswire-Asia/ -- Emerging Asia leads the world in the implementation of sustainable real estate solutions finds the Q3 2010 RICS Global Property Sustainability Survey is published lately. The region ranked first across many property sectors and occupier types in this quarter's survey, with agents reporting the highest rises in demand for sustainable real estate solutions in the government, bank and commodity sectors. Agents also report that both large and small occupiers have increased their demand Q3 2010 over Q1 2010.

Comments from respondents in the region indicate that sustainable real estate is a growing movement in Emerging Asia with governments introducing incentives for the initiation of green technology in the construction sector and the latest building trends focusing on ‘environmentally friendly' design and ‘green' features.

Overall, demand for sustainable real estate solutions looks set to remain strong in the region as respondents gave the most positive indication that sustainability has moved up the corporate agenda as a result of the Gulf oil spill (net balance of 62 percent) and that sustainable construction will not be overshadowed by issues of government debt (net balance of 33 percent).

Developed Asia Findings:

  • Agents report that demand from governments, media and professional occupiers in this region is considerably less positive this quarter over Q1 2010. While still positive, all three categories saw sharp contractions.
  • Small occupiers in this region have shown an increase in demand for sustainable real estate solutions, moving from a negative net balance in Q1 2010 to a positive net balance of +12 this quarter, but demand from large occupiers is still considerably stronger.
  • Agents in this region felt that government focus on managing debt burdens was unlikely to negatively impact sustainable construction activity, indicated by a net balance of +29.

Mr Henry Li, Chairman of RICS China, said:

"It is encouraging to see that professional firms in emerging Asia are leading the way in terms of implementing sustainable solutions. Interestingly, the media played an important role in implementing sustainable solution, ahead of professional firms. I believe clients' demands, business bottom line and the natural environment are the main driving force for the movement towards sustainability.  Clients' sustainability agenda and the economic argument for energy efficiency and green buildings will be growing in strength in emerging Asia countries particularly in China."

Global Findings

In terms of global sectors, the survey found that most governments around the world increased their implementation of sustainable real estate solutions, from a net balance of +36 to one of +34, Q1 2010 vs. Q3 2010. Implementation in the manufacturing sector is increasing modestly but continues to lag the other sectors in general. Of particular interest is Latin America, where the net balance improved to +37. Across all sectors globally, the survey found that implementation of sustainable solutions is generally on the rise compared to last quarter, with professional firms and governments continuing to lead the way.

Gulf Oil Spill

Globally, the survey found quite a range of responses to the question of whether the oil spill in the Gulf of Mexico had forced the issue of sustainability up the corporate agenda. Results in Emerging Asia, Latin America and Developed Asia were most positive (net balances of +62, +48 and +45, respectively), while, surprisingly, particularly given the proximity of the spill, only 29 percent of responses from North America indicated that the incident will force the issue higher, while 65 percent said the spill would, in fact, result in no changes to corporate priorities. Western Europe, Emerging Europe, Australasia, Africa and the Middle East had considerably smaller positive net balance results, indicating that these regions are closer to a ‘no change' perspective.

Impact of Debt Burdens

Not surprisingly, North America saw many respondents, 20 percent, reporting that government actions to handle debt burdens would most likely result in a negative impact for sustainable construction. However, a significant majority in all regions felt that there would be no impact and 40 percent in Emerging Asia felt that there would be an increase in sustainable construction.

Mr Nigel Smith, Chairman of Commercial Property Professional Group Committee of RICS Hong Kong commented,

"In RICS, we are advocating a total sustainability concept involving polices and practices in urban housing, energy, construction and land management.  The survey results send a very clear signal to the industry, and this is why RICS Hong Kong is organizing our annual conference on "Why, What and How – The Truth Behind Sustainability" on May 14 for broadcasting this concept to our members and industry practitioners."

Commenting on the survey findings, Ms Ursula Hartenberger, RICS Global Head of Sustainability, said:

"It is interesting to see the dramatic rise in demand that has pushed Emerging Asia to the top spot when it comes to implementing sustainable real estate solutions. While not surprising given the uncertain economic outlook and the focus of governments in addressing the overhang of public sector debt, North America is expected to see a disappointing decline in the uptake of sustainable solutions. More positively, global implementation continues to rise and, overall, agents report that debt burdens are unlikely to completely derail the shift to sustainable construction."

For further details, please download the full report from:

http://www.ricsasia.org/newsDetail.php?id=304

Notes for editors:

Net Balances: Net balance percents are calculated by subtracting the numbers of respondents reporting ‘down' from the number who reported ‘up'.

About the Survey: The Global Property Sustainability Survey is designed to highlight commercial property trends and share insights from local real estate firms and leading international real estate organisations.

Respondents were asked to compare conditions in the latest quarter to the previous quarter. Responses for the Q3 2010 survey were collected until 27 September 2010 and amalgamated across the three real estate sub-sectors of offices, retail and industrial property at a country level to form diffusion indices for the commercial market as a whole.

About RICS & RICS Asia

RICS (Royal Institution of Chartered Surveyors) is the mark of property professionalism worldwide. It covers all aspects of property, construction and associated environmental issues. RICS has 150,000 members globally and represents, regulates and promotes the work of property professionals throughout 146 countries.

The RICS Asia supports a network of over 11,000 individual professionals across the Asia region with an objective to help develop the property and construction markets in these countries, by introducing professional standards, best practice and international experience. It promotes RICS and its members as the natural advisors on all property matters. It also ensures that services and career development opportunities are provided to members. The RICS Asia region covers national associations and local groups locating in Brunei, Malaysia, Singapore, Thailand, The People's Republic of China and the SAR Hong Kong. It also has members working across the region such as Bangladesh, Bhutan, Burma/Myanmar, Cambodia, Indonesia, Japan, Kiribati, Laos PDR, Macao, Mongolia, Nepal, North Korea, South Korea, Taiwan, The Maldives, The Philippines, Timor East and Vietnam. For more information, please visit: www.ricsasia.org.

Media enquiry, please contact:

RICS Asia Public Relations Representative
Ms Belinda Chan / Ms Ava Lau
Tel: +852-2372-0090
Fax: +852-2372-0490
Mob: +852-9379-3045 / +852-9829-2913
Email: belinda@creativegp.com / ava@creativegp.com

Source: Royal Institution of Chartered Surveyors
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