the economic feasibility of sustainable logistic real estate bart de smedt roel gevaers department...
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The economic feasibility of sustainable logistic real estate
Bart De SmedtRoel Gevaers
Department of Transport and Regional EconomicsUniversity of Antwerp
ERES Conference 2009 – June 26th - Stockholm Royal institute of Technology
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Introduction
BUILDINGS: 40% of energy consumption and CO²-emissions
COMMERCIAL REAL ESTATE:• RETAIL 43%• OFFICES 34%• LOGISTICS 23%
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Introduction
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Introduction
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Research questions
• How does a green warehouse differ from a traditional warehouse?
• What are the difficulties in the financial valuation process of green warehouses?
• Can a certificate facilitate the appraisal of green logistic warehouses?
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How do green warehouses differ from traditional ones?
• Traditional warehouse Old warehouse
• Green warehouse: - high-performance- reduce impact on environment and health
Achieve through: Location, design, material selection, construction, operation, maintenance, removal and possible re-use
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Location
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Physical characteristicsExample: $2 billion restoration of Ford’s 400 ha Rouge River manufacturing complex (Dearborn, MI, USA)
Points of attention:• Stormwater• Green roofs• Soil remediation• Natural Lighting• Workers safety• Flexibility
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Physical characteristicsExample: Klavertje 4 ‘Greenport’, Province of Limburg (NL)
Points of attention• Rely on renewable forms of energy • Maximize water reuse• Minimize reliance on potable water• Building orientation • Daylighting and envelope design as active strategies (geothermal systems, adiabatic cooling and natural ventilation)
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Physical characteristics
Park Blue Planet, Chatterley Valley, UK(Gazeley)
Magna Park Rhein, Main, Germany (Gazeley)
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Financial valuation
Necessary in order to move forward, overcome lack of hard data that quantify costs and benefits of individual environmental green features.
Based on a good model trade offs can be done by the sector.
In the end, no logistic development can be truly sustainable unless it remains economically viable and continues to deliver a strong return to investors. This idea is sometimes lost in the debates and should not be forgotten.
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Difficulties in financial valuation
• Position in the appraisal process developer or user
• Paradox: sustainability - long term vision financial valuation - short term view• Lack of real life cases in Belgium• A lot of qualitative benefits
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Certificate as a way to facilitate appraisal
What should be incorporated in a certificate?- Sectorspecific certificate with only logistic building
aspects- Overall building certificate with subdimensions for
different sectors (offices, logistics, retail)- Total supply chain certificate
The lack of common legislation has created a variety of certificates with different parameters (LEED, BREEAM, Green Star, DGNB, EEWH, Casbee,…).
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15Countries Measurement
parameters
Types of buildings
LEED US
Argentina
Brazil
Canada
India
Sustainable sites
Water efficiency
Materials & resources
Indoor environmental
quality
Innovation & design
processes
New buildings
Existing buildings
Commercial interiors
“Core & sells”
School buildings
Retail
Rest homes
Houses
Neighbourhood
development
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Breeam UK
The Netherlands
Management
Health
Energy
Transport
Water
Materials
Waste
Land use & ecology
Pollution
Offices
Retail
School buildings
Prisons
Court buildings
Rest homes
Industrial buildings
Eco-homes
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Green Star Australia
New-Sealand
South-Africa
Space use
Spatial
differentiation
Conditional
requirements:
equal to Breeam
Timing of the
certification
School buildings
Rest homes
Industrial buildings
Mixed use
Multi unit
residential
Offices
Office interiors
Retail
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German Sustainable
Building Certificate
Germany Ecological quality
Economical quality
Socio-cultural
quality
Technical quality
Quality of the
building process
Quality of the
location
All types of buildings
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EEWH Taiwan Equal to LEED Equal to LEED
Casbee Japan Energy
Resource efficiency
Local environment
Indoor environment
Pre-design
New construction
Existing buildings
Renovation
Furthermore, the following countries have also their specific certificates: Mexico, France, Finland, China, Italy, Portugal, Singapore and Spain.
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Certificate as a way to facilitate appraisal
One clear, standard and transparant certificate is needed for the real estate market that is dominated by international operations.
This would facilitate comparability and would facilitate therefore the appraisal process.
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Conclusion
Building green warehouses? All the stakeholders are willing but without certainty about the economic feasibility it stays problematic.
First movers are already on the market but it is to early (data is not yet available) to make strong predictions on the evaluation.
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Thank you for your attention