Trending now in CRE: Sustainability

The sustainability movement is growing across practically every sector in technology. Since real estate is responsible for nearly 40% of global CO₂ emissions, it’s no surprise that the built world is focused on sustainability and climate action. However, curbing carbon emissions in our industry will require unprecedented cooperation between owners and tenants. Owners will need to create sustainable spaces for their tenants and establish systems to optimize comfort and minimize climate impact, while tenants must adjust their behaviors and leverage their building’s investments in technology to limit their own carbon footprints.  

To accelerate change, regulators are increasingly implementing climate requirements to penalize slow movers. Lenders and underwriters are requiring stringent climate disclosures, and investors are demanding corporations lower carbon footprints, prompting unparalleled demand for sustainable occupancy. At JLL Spark, we have prioritized our efforts to identify and invest in the leading technological solutions that tackle our industry’s largest challenge.  

While there are many areas to drive increased sustainability in the built world, let’s start with a macro focus on the three core stages of the built world lifecycle: construction, occupancy, and demolition/disposal. While building operations are a major contributor to an asset’s environmental footprint, building materials and the construction process are also responsible for a significant portion of emissions. We need to address all aspects of the built world’s carbon contribution to reach net zero goals.  

Construction technology (ConTech), equally vital to a decarbonized future, is a key focus in JLL Spark’s thesis. Investments we’ve made include Juno and Veev, which build innovative and sustainable housing developments for fast-growing neighborhoods by reducing the time and cost to build new residences and using materials that increase the longevity of these structures. We’ve also made investments in INGENIOUS.BUILD and ALICE Technologies, which help project managers streamline their paths to build and remediate when adverse events threaten overall cost and timeline agreements. We continue to identify and invest in companies that push the boundaries of sustainable construction practices to ensure we and our clients can limit our collective environmental footprint.  

This takes us to the occupancy of buildings. Many buildings around the world are antiquated; built and embedded with technology equally as archaic. Therefore, we need to optimize building systems and insert today’s technological efficiencies within existing structures, which is why we’ve invested in Infogrid and Turntide Technologies. At JLL, we and our clients have leveraged Infogrid’s smart IoT technology to drive reductions in cost and energy needs in buildings around the world. Turntide tackles one of the largest emitters and costs in existing buildings today: energy usage. By replacing traditional motors with Turntide’s Smart Motor System, we can reduce a building’s energy usage by an average of 64%. Our partnerships with Infogrid and Turntide are two of many examples demonstrating our core belief that substantial reductions in carbon emissions cannot be achieved through hardware or software alone. We must invest in and implement both to effectively scale our impact.  

The final stage of the cycle is demolition/disposal. While not feasible in every instance, buildings should be repurposed and transformed whenever possible considering the environmental impact of erecting a new building. Our partnership with ecoworks, a Germany-based platform that enables seamless renovations to transform deteriorating and carbon-inefficient residential buildings into reinforced and ecofriendly structures, exemplifies our commitment to reducing the climate impact created by needless new construction. 

We are just beginning to scratch the surface of technology that will help decarbonize the real estate industry. There will undoubtedly be many more innovations that disrupt various facets of the built world’s existing lifecycle, and we’re excited to partner with the entrepreneurs and startups creating them.  

Interested in an investment from JLL Spark Global Ventures? Apply here.

Written by Laurent Grill, partner, and Ajey Kaushal, senior investment associate