The role of sustainability in the valuation of real estate assets
Sustainability has been asserted as an essential valuation criterion in the real estate sector. In addition to responding to environmental and social concerns, it has become a determining factor in asset attractiveness, income stability, and long-term investment protection.
The market has changed: occupiers, investors, and regulators increasingly demand performance, transparency, and accountability. And the assets that integrate good sustainable practices are today the ones that best withstand the pressure of time, legislation, and the volatility of economic cycles.
Green Assets vs. Brown Assets: What's at Stake?
In the current regulatory and market context, it is essential to distinguish between green and brown assets.
Green assets are energy efficient buildings built or rehabilitated with sustainability criteria and, often, holders of recognized environmental certifications. Already the Brown assets correspond to properties with poor energy performance, high operating costs and less capacity to adapt to current environmental requirements.
This difference has real consequences: Brown Assets Face Greater Financing Difficulties, Increasing Regulatory Pressure and Risk of Devaluation.
In contrast, green assets are gaining relevance in the portfolios of the most demanding investors and demonstrate greater resilience in the medium and long term.
More efficiency, less risk, greater profitability
Assets designed or adapted to comply Sustainability criteria have clear advantages:
- Reduction of operating costs, thanks to energy, water and functional efficiency;
- Greater attractiveness for tenants, who value comfort, certifications and environmental responsibility;
- Lower risk of obsolescence, ensuring the relevance of the asset in the medium and long term;
- Continuous valuation, through the combination of yield stability and alignment with market and regulatory requirements.
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Certifications as an instrument of trust and differentiation
Certifications such as LEED, BREEAM, WELL, or WiredScore are the recognition of the commitment to high standards and that:
- They reinforce the Investor Confidence;
- They facilitate More competitive financing processes (green loans, sustainability-linked loans);
- Increase the Commercial visibility of assets and are often a decisive factor in the choice of more demanding tenants.
More than a one-off advantage, These recognitions contribute to reinforcing the asset's position in the market and the soundness of the investment Over time.
Asset valuation cycle and longevity
One of the great benefits of sustainable assets is their ability to remain competitive over time.
The integration of good environmental practices, the choice of durable materials and the concern for comfort and efficiency increase the current value of the property, significantly reduce the risk of obsolescence and avoid frequent renovations, maintaining attractiveness with occupants and investors. This stability is particularly valuable in a context of constant regulatory evolution and greater demand on the part of the market.
The adoption of renewable energies, in particular solar systems, also represents a competitive advantage:
generates savings, increases energy autonomy and reinforces the asset's positioning in a market that is increasingly oriented towards decarbonization.
Sustainability and Collective Investment: A New Way to Create Value
Collective investment in the real estate sector, through funds for example, benefits especially from the integration of sustainable criteria. In addition to allowing greater scale and diversification, it guarantees a More professional approach to ESG risk assessment, the definition of performance metrics and the monitoring of good practices throughout the asset's useful life.
In addition, European regulation has been reinforcing the requirement for transparency and accountability, with emphasis on the EPBD (Energy Performance of Buildings Directive), the Sustainable Financial Disclosure Regulation (SFDR) and the European Taxonomy, putting pressure on investment vehicles to adopt increasingly strict sustainability standards.
Real estate valuation no longer depends solely on location or area. It depends on the ability of the asset to respond to environmental challenges, to serve the people who use it well, and to adapt to the weather.
Sustainability is a minimum standard for those who want to invest with solidity, vision and responsibility. The most efficient, certified, and well-managed assets are also those that most resist instability and are better positioned for the future.
It is in this context that the role of management entities is recognized. In the case of Nexa, sustainability is seen as a strategic valuation vector. Through rigorous management committed to ESG principles, collective investment with real impact is structured, creating economic, environmental and social value, in a transparent, conscious and lasting way.
