The Alicante City University Venue has hosted the first working meeting of a consortium comprising partners from countries such as Germany, the United Kingdom and the Netherlands
Alicante. Friday 16 March 2018
The building and real estate sectors are largely responsible for polluting the planet. In this sense, decarbonising the economy is one of the European Union’s main goals with the project Carbon Risk Real Estate Monitor (CRREM), in which the University of Alicante takes part.
The project is intended to accelerate the decarbonisation and climate change resilience of the real estate sector by providing appropriate science-based carbon reduction pathways at the property, portfolio and company level. CREEM aims to analyse carbon reduction pathways in the real estate market and increase investment in sustainable retrofits by estimating present and future emission and refurbishment costs. To that end, it will make real estate asset decarbonisation targets more transparent and accessible across Europe.
UA Interuniveristy Institute of International Economics researcher Paloma Taltavull, who participates in the project alongside Raúl Pérez and Francisco Juárez, explains: “The poor energy efficiency of existing buildings and the still low refurbishment rates in virtually all member states are among the most important risks for the sector. Many assets will become stranded properties that will not meet future energy efficiency standards or whose required energy retrofit might not be financially viable.”
CREEM is a four-year (2018-2021) project coordinated by the German Institute for Real Estate Operations (IIÖ). In addition to the University of Alicante, there are two British partners (Ulster University and STURGIS, a prestigious research centre devoted to building energy efficiency) and two Dutch partners (Tilburg University’s Tias Nimbas Business School and GRESB, a company specialising in energy efficiency data collection and monitoring). The kick-off meeting took place at the Alicante City University Venue on 12 and 13 March 2018.
CREEM experts aim to develop a tool allowing investors to assess the risks involved in stranded assets, for energy efficiency reasons, in the commercial real estate market, so they can switch investments to more energetically efficient buildings. According to Ms Taltavull, “one of the objectives is to develop a financial risk assessment and profitability framework for investments associated with carbon mitigation strategies.”
The goal is to integrate carbon efficiency and retrofit requirements into companies’ building investment decisions by evaluating and clearly communicating the downside financial risks associated with a low energy performance. The project will also quantify the financial implications of a stricter regulatory environment regarding carbon intensity on the building stock.
Moreover, CREEM will provide investors with reliable risk assessment tools to raise awareness of the need for climate risk management at the corporate level. It will equally support the assessment of financial, regulatory and administrative barriers for investment. In fact, one of the outputs of the project will be a risk, cost and benefit assessment tool available online for free.