As the Chinese mainland advances towards its dual-carbon goals, the real estate sector faces both challenges and opportunities. Sustainability is now central to long-term value creation in commercial real estate (CRE), driving demand, performance and resilience.
This report aims to explore how sustainability influences operational performance, asset value, and investment decisions within the commercial real estate (CRE) sector on the Chinese mainland. It provides a comprehensive examination of key Environmental, Social, and Governance (ESG) drivers, policy frameworks, market trends, and benchmarking tools such as the GRESB with the goal of equipping stakeholders with actionable insights for navigating a rapidly evolving sustainability landscape.
Key findings reveal that sustainability is increasingly driving demand, performance, and resilience in CRE. Green-certified buildings are associated with lower operating costs, stronger tenant retention, and higher valuations – particularly in Tier 1 cities. ESG-aligned investment strategies are gaining traction, supported by green financing mechanisms, government incentives, and growing regulatory requirements. Benchmarks like GRESB are playing a pivotal role in standardizing ESG reporting, guiding capital allocation, and fostering transparency.
Recommendations include embedding sustainability into asset design and retrofits, adopting PropTech for real-time energy management, aligning ESG reporting with GRESB metrics, and engaging stakeholders across the real estate value chain. These practices not only enhance financial and operational performance but also improve risk management and market competitiveness.
In summary, the relationship between sustainability and real estate performance is becoming increasingly direct and measurable. Sustainable practices are no longer peripheral – they are central to long-term value creation. As the Chinese mainland advances toward its dual-carbon goals, commercial real estate players who proactively integrate ESG principles will be best positioned to thrive in a decarbonizing economy.
