The building sector plays an important role in achieving climate goals. This also applies to logistics properties. In terms of numbers, they are more of a niche compared to other classes of use such as office or living, but in terms of square footage it looks different. Because a medium-sized warehouse can easily reach several thousand square meters, large ones up to 50,000 square meters and more. Whether you light them conventionally or equip them with energy-saving LED lights, whether you insulate the roof properly or not, it makes a difference. Larger venues in particular are now increasingly designed, built and operated with sustainability in mind.
The impetus does not come primarily from industry, but from politics. “States are the engines, Germany and the EU too. The drivers are the investors, the large owners with their own funds and the project developers ”, explains Kuno Neumeier, managing director of the consulting company Logivest, specializing in real estate logistics. domain. One expression of this political pressure is the so-called EU Taxonomy Regulation, which aims to make the sustainability of real estate investments transparent. From January next year, many technical evaluation criteria will be used to measure when an investment is considered sustainable in the sense of taxonomy. Real estate funds which are then considered to be unsustainable or not very sustainable may have difficulty finding investors in the future. Companies that operate unsustainable warehouses could be frowned upon by their customers for this. They will therefore no longer ask for such properties, which pushes the owners to offer new rooms according to the new standards and to renovate the existing rooms. The so-called ESG criteria, which describe to what extent an object is sustainable in terms of the environment, society and corporate governance, go in the same direction.
LED lighting, solar panels on the roof – this could soon become the norm
Those involved recognized the signs. For example, one of the largest developers of logistics real estate projects in the world, Prologis, is committed to achieving 100% of its new development and renovation projects worldwide in accordance with sustainable construction certifications. Additionally, all properties are to be fitted with LED lighting by 2025, and by 2020 alone, Prologis will have installed 40 megawatts of additional solar capacity on the rooftops of its properties.
Sporting goods manufacturer Puma’s new central warehouse in Geiselwind, Franconia was also developed in accordance with sustainability guidelines that specifically improve energy efficiency and environmental compatibility. There is its own photovoltaic (PV) system which will supply the building with certified green electricity in the future. In addition, a system of using rainwater for flushing the toilet and energy-saving LED lighting throughout. Much of the roof area is planted with lawn. Gradually, 400 trees will be planted on the 116,000 square meter site, which will then offset five tonnes of CO2.
First of all, it is all expensive. But the costs must be partially offset by lower operating costs. “Measures such as LED lamps and intelligent daylight control ensure that electricity consumption is up to 26% lower. With the increase in electricity prices, we assume that the investment in the photovoltaic system will be more than profitable over the next ten years, ”explains Maximilian Molkenthin, senior logistics manager at Puma. In addition to environmental measures, Puma also wants to score points with the S of ESG, the social. This is why, for example, the workstations have been ergonomically optimized. But there are also very tangible reasons. With more attractive jobs, it is hoped that there will be advantages in recruiting staff. “One of the objectives of all measures in the social field is of course the retention and recruitment of employees”, explains Neumeier. With a few exceptions, there is a chronic staff shortage at all logistics locations in Germany.
Stephan Riechers, head of investment management logistics at fund provider Union Investment, sees it the same way. “In the logistics sector in particular, there is still a lot of room for social improvement. Until now, logistical properties were mostly seen as purely functional properties, ”he says. Slowly but surely, that perspective is changing. Riechers knows warehouse operators who provide employees with sports facilities during breaks and who provide an attractive canteen with a good choice of food. They create terraces, charging stations for electric vehicles and are even increasingly thinking of visually more attractive facades.
Small logisticians only rethink when new laws force them to do so
Examples like that of Puma or Prologis show that the pursuit of sustainable development definitely plays an important role for the major players, whether on the side of users or also developers. However, this often does not apply to small logisticians yet. Above all, they see the effort at stake and prefer to react only when compelled to do so by regulations and laws. Sustainable measures can also be found, especially in new buildings. The reconversion of the immense park of cinemas in this country has hardly been discussed. Incidentally, the situation is similar in other categories of goods. This is probably one of the reasons that real estate performed relatively poorly in the federal government’s 2020 climate balance sheet. It is true that CO2 emissions in the Corona year in all sectors were 40% lower than in the base year 1990. However, the building sector performed worse than all others. areas.
This could change in the future. “There is no bypassing the decarbonisation of the real estate portfolio. We expect the legislator to tighten the reins significantly when it comes to CO2 consumption. This is the only way to achieve the targets. of climate protection in Paris, ”explains Riechers. Follow developments very closely. Otherwise, you risk owning assets for which there is no longer any demand or which can no longer be traded because they do not meet current requirements.
Despite the increasing demands on the durability of logistics properties, this construction class is still popular with investors. Also because the yields are a bit higher than in the office or living room. In addition, demand will remain stable or even increase due to the constant increase in online commerce. Additionally, the corona pandemic has shown how important warehouses are to maintaining supplies. This has increased the acceptance of this once rather unpopular property. “We believe that logistics real estate is a very resilient asset class. This means that we can provide very stable rental income to our investors, ”says Riechers. Union Investment therefore also wishes to double its share of logistics real estate in its portfolio in the medium term.