Environmental activism has made many strides over the last quarter century, and it’s led to a revolution in several industries. Although real estate is still relatively untouched by regulations based on environmental concerns, it’s only a matter of time before this happens.
Real estate agents, owners and investors need to know how these regulations may affect their properties, including sales and leasing. Properties that they can now rent may not conform to these new regulations, shutting off one of the owner’s income streams. Below, 10 members of Forbes Real Estate Council look at actionable steps that real estate players can take to prepare for more environmental-focused regulations in the near future.
Members of Forbes Real Estate Council share steps real estate professionals can take to prepare for future environmental regulations.
1. Be Proactive
It is important to plan for the future and be proactive. Having an overly compliant green building not only protects the owner, but the property is more appealing to many buyers and tenants. If a property is not up to the likely future standards, an assessment of the amount of annual capital reserves an owner should retain is crucial to cover costs relating to future regulations. – Matthew Douglas Cardente, Cardente Real Estate
2. Start Small
Start right away and start small. Items like programmable thermostats and LED bulbs can help residents realize real savings on their utility expenses. As an added benefit to the landlord, it also increases the marketability of the home while helping fight climate change. – Jacqueline Lee, Brandywine Homes USA
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3. Insist On LEED Standards Compliance
Owners of commercial real estate have been improving their properties to meet green building standards through LEED Certification (Leadership in Energy and Environmental Design) standards since the 1990s. Building owners are making capital improvements now to meet new workplace health standards. To increase these improvements, occupiers should insist that they will only lease properties that meet high sustainability standards like LEED. – Richard Lackey, City Commercial Real Estate, Inc.
4. Consider WELL Certification
Developers have valued getting various certifications at their new apartment buildings; however, consumers are now truly pushing for more. Prospective renters want to know and are making decisions about everything from air quality to recycling plans. With a strong push from consumers, programs such as the WELL Certification will become an industry standard. – Aaron Galvin, Luxury Living Chicago Realty
5. Leverage Relevant Data And Tech
The best way to prepare is with technology. We are using tech to reduce maintenance costs and resource usage. The best way to prepare is to first start with knowing exactly where you are. There are many building systems that can be enhanced with a smart device. There’s no crystal ball to know what the government will throw at us, but being nimble because you have data will help you stay ahead. – Amy Tiemann, TM1 Properties
6. Prioritize Sustainable Building Practices
Companies that prioritize sustainable building practices and establish strong relationships with local government agencies will be best prepared for future regulations. As an affordable housing company, we work to sustain our planet through efficient water and energy technologies at our properties. Having existing experience can best prepare industry players for what may arise. – Jeremy Bronfman, Lincoln Avenue Capital
7. Broaden Your Personal Stakeholder Community
Broadening your personal stakeholder community is a great start. Engage with regulators, legislators and trade associations so that as changes are discussed, there is good debate abot timing, priorities and communication. The world, as is so often the case, is still run by people who simply show up. – Clark Twiddy, Twiddy & Company
8. Focus On Educating Yourself
Education is key. It is important to understand the current problem and investigate what potential solutions are available. Research new and emerging technologies, understand current regulations and anticipate the changes you can make as you forecast ahead. – Michelle Risi, Royal LePage Connect Realty
9. Capitalize On Government Incentives
A savvy portfolio owner will take a “Tesla” approach and capitalize on government incentives to future-proof properties with green technology. For example, California has a bevy of benefits, such as expedited permitting, rebates and tax incentives. These can be taken advantage of with the right team of a lawyer, architect and contractor to “greenify” a building at a substantial discount. – Deniz Kahramaner, Altasa
10. Embrace Solar Energy Early On
Some things are common sense and logical, like relying on the sun’s energy to power your home. You don’t have to be anti-growth to embrace solar. In fact, it represents a massive opportunity. If you can get ahead of the game and embrace solar before it is mandated, the gains will be significant. – Kevin Markarian, Marker Real Estate
Forbes Real Estate Council is an invitation-only, fee-based organization for senior-level executives in the real estate industry.