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Chapter 11 Sustainable Development Property Development ( 6 th Edition) Publisher : Routledge Authors : Professor R.G . Reed and Dr S . Sims. 11.1 INTRODUCTION. B uildings are substantial CO 2 emitters and contribute substantially to climate change.

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Chapter 11 Sustainable Development

Property Development(6th Edition)


Authors: Professor R.G. Reed and Dr S. Sims

11 1 introduction
  • Buildings are substantial CO2 emitters and contribute substantially to climate change.
  • The value of a building can at times be linked to the building’s perceived level of sustainability.


  • The commonly used definition is:

Sustainable development is development that meets the needs of the present without compromising the ability of future generations to meet their own needs.

  • Conducting a development in a sustainable manner is arguably already being undertaken by all developers as they ‘re-use’ some of their resources (e.g. computers, scaffolding, tools) for subsequent developments.
  • The focus has moved from considering ‘which individual property development is sustainable?’ to ‘how sustainable is each property development?’
11 2 what is sustainability and sustainable development


  • The challenge at hand to increase the level of sustainability in the built environment is (a) the task of undertaking the property development and (b) the operation of the developed property after completion.
  • A sustainable existence is ensuring future generations will have the ability and means to achieve a quality of life equal to or better than today's life.
  • Triple Bottom Line (TBL) relates to the social, economic and environmental aspects of society.



Figure 11.1 'Three Pillars' Model of Sustainable Development based on TBL Accounting

11 2 what is sustainability and sustainable development1



  • The argument behind the use of TBL is that all three aspects must be accounted for when undertaking sustainable development, although this model has evolved.
  • The latest model (Figure 11.2) includes a fourth pillar to reflect the importance of cultural aspects in creating lively communities in which people want to live, work and visit.

Sustainable Community



Figure 11.2 Four Pillars Model of Sustainability

11 3 corporate social responsibility
  • Corporate Social Responsibility (CSR) is at times referred to using other terms including ‘corporate citizenship’, ‘responsible business’ or simply ‘corporate responsibility’.
  • CSR is linked to companies which incorporate ‘the actions of corporate actors that address social and ethical values beyond legal requirements’(Van Aaken et al. 2013).
  • Abusiness that adopts CSR is committed to following ‘best practice’ for all stakeholders and to making all their activities open and transparent.
  • CSR could be viewed as an attempt to gain a competitive economic advantage by creating a favourable impression on employees, clients and consumers.
  • The perception of what CSR is varies between different sectors in the same market and also between different countries.
  • Most of the information disclosed by businesses in their voluntary social disclosures relates to employees, the environment and the community. There is no standardisation in the type of content included or the way this information is reported.
11 4 different types of csr
  • Most types of CSR have evolved from economic, legal, ethical and philanthropic responsibilities which in turn also relate to three classifications of ethical CSR, altruistic CSR and strategic CSR.
  • Other considerations may affect a company’s approach to CSR.
  • A factor which may affect a company’s overall approach to CSR is its position in a certain business sector and its level of power.
  • The perception of larger corporations can vary on an individual basis and these corporations may have a completely different perception of the role of CSR.
  • Given the variation in conceptual understanding and the different types of CSR each company will generally incorporate CSR in a different way.
  • With direct reference to property development, each developer is likely to observe some variation both within and across the sectors based on parameters such as company size.
11 5 sustainability reporting
  • When undertaking CSR a fundamental aspect is to maintain a high level of accountability to all stakeholders in relation to social, economic and environmental impacts. In this context, sustainability reporting is the method of demonstrating accountability.
  • The role of reporting also enables businesses to develop new targets and goals in terms of relevant social, economic and environmental impacts.
  • It is imperative to benchmark activities to industry standards where possible, e.g. a relevant measurement may be the amount of waste products produced or the amount of water or electricity consumed per annum.
  • A strategy should be set up whereby accurate reporting and documentation of the policy can be recorded within a specific time frame.
  • Aresponsible person has to be identified within a senior management role so that they have the power to ensure targets are implemented within the business.
Discussion point:

How does the concept of sustainability relate to property ‘development’?

Consider the process of development and the direct relationship, in most instances, with the planet as the land component.

11 6 real estate development sustainability and csr
  • CSR may affect property development either in the direct employment of staff and how they operate and occupy their property or in the way the developer actually develops or redevelops property.
  • Carbon dioxide is the most talked about greenhouse gas which is produced during the consumption of fossil fuels such as oil and gas. Typically electricity has been generated by gas and coal fired power generation plants, therefore electricity consumption also releases carbon dioxide into the atmosphere.
  • Whilst developers can build a low or even zero carbon building, it is the operational phase of a building’s lifecycle which is crucial in its overall environmental impact.
  • It has been accepted that the overall environmental impact of buildings (irrespective of size) is substantial and needs to be reduced.
11 7 the case for sustainability
  • The environmental, social and economic arguments for sustainability in the built environment have been well proven.
  • Of the social and environmental arguments put forward, sustainable buildings are increasingly promoted as being healthier buildings for occupants and users.
  • Sustainable buildings tend to maximise natural daylight and fresh air, therefore improving both the internal air quality and the internal environment quality in their design, which research has shown to be preferred by building users.
  • Sustainable buildings can lead to less absenteeism from workers, less churn or turnover of staff and increased productivity in workers, which in turn creates an economic argument for sustainable buildings.
  • Another aspect of the economic argument is that sustainable buildings cost less to run.
  • There is an argument that sustainable buildings will attract higher rentals (often referred to as ‘green leases’) because of the perceived health and productivity gains for occupants attributed to sustainable buildings.
11 8 sustainability and property development
  • In different stages of the property development cycle it is important to identify sustainability issues which affect each of the following:
    • Developmental land and sustainability
    • Development finance and sustainability
    • Planning and sustainability
    • Sustainable design and construction
    • Water
    • Health and well-being
    • Market research and sustainability
    • Marketing a sustainable development
    • Promoting and selling sustainability.
11 9 sustainability rating tools
  • Although there are common approaches to the valuation of land and buildings and an analysis of those values to identify trends, environmental rating tools have not followed this trend and many different countries have their own measurement tools and rating standards.
  • The current era of rating tools commenced in 1990 with the introduction of the BREEAM rating tool, and five years later this was followed by the French system, HQE, and by LEED in 1998.
  • The evolution and adoption of rating systems in different countries is largely based on the initial rating systems.
  • In an era of international property development and investment where it is possible to compare valuations of buildings in different countries, it is unfortunate that rating tools do not exhibit the same level of comparability due to their unique characteristics and specific focus.
  • This may potentially hinder the take-up rate of sustainable rating tools and be a barrier to increasing knowledge about the sustainable attributes of comparable office buildings located in different countries.
Discussion points:

What are the main environmental assessment tools available to property developers?

Why would property developers use these tools?

Chapter 11 Sustainable Development

Property Development(6th Edition)


Authors: Professor R.G. Reed and Dr S. Sims