Buildings Performance Institute Europe (BIPE) has released a report highlighting that retail real estate asset managers, owners and investors lack a strategy towards achieving climate-neutrality. The report marks the launch of Paris-Proof Retail Real Estate, an initiative that looks to develop a vision and strategy to support the European retail real estate sector reach net-zero carbon emissions by 2050.

The report highlights that the current rate of decarbonisation of retail buildings is not happening fast enough to meet climate goals. Extreme weather conditions, rapidly expanding floor area and growth in demand for energy consuming services exacerbate the issue.

According to the report, existing low carbon transition and 1.5C climate roadmaps are not yet fully adapted to the needs of the sector, and climate change issues are not yet fully integrated into mainstream asset management and investment decision-making processes, traditionally focused on the cyclical trends of property markets.

“In Europe, while GHG emissions targets are well defined for 2030 and 2050, these are not yet transposed into meaningful guidance for individual industry sectors,” said Zsolt Toth, senior project manager at BPIE.

As BPIE’s analysis shows, most of the risks associated with climate change are expected to appear in the medium to long-term and thus are not captured by the relatively short-term models used in most current risk management practices. Data gaps, confusion of metrics and protocols, as well as the particular nature of carbon risks could give rise to a collective mis-assessment by real estate markets.

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