IMPACT OF ESG FACTORS ON PROPERTY VALUE

Abstract

Today's real estate market should take into account the most important environmental, social and corporate (governance) factors and values. In recent times, there have been many problems with the implementation of ESG (environmental, social, governance) in all life cycles of real estate, from the process of planning, design, construction, operation to the demolition of real estate from any sector In this article, ESG factors will refer to the industrial real estate sector. The article will provide an overview of ESG and sustainability issues and identify the current impact of environmental, social and governance factors on real estate values. In addition, it will present initiatives related to the transformation of the real estate market into a so-called “green market,” which carries high initial costs associated with adapting technologies used in real estate to ESG strategies. The costs incurred, in effect, translate positively into the exposure of “green real estate” in the market with regard to potential tenants or property owners.

Verification of considerations will be presented on the basis of juxtaposition of two industrial properties with varying degrees of implementation of ESG strategies in the life cycle of the property.