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Sustainability in the Construction and Real Estate Sector

March 24, 2023 Construction site

The construction, design, and use of buildings is one of the most significant contributors to greenhouse gas emissions worldwide. About 27% of global CO2 emissions in 2021 resulted from energy use in buildings according to a report by the IEA. The manufacture of construction materials such as cement and steel contributed an additional 6% of global emissions. The materials and machinery used in the construction process produce waste, contribute to CO2 emissions, and require energy, while the design of a building–including its energy efficiency, location, and life expectancy–determines how the use of the building impacts the environment.

Many companies in the construction sector have set goals with respect to sustainability, but few have taken real action because of the many obstacles to lowering emissions. According to Forbes, in a SAP survey of 1,000 industry executives, 47% of respondents said that increased process complexity presented an obstacle to becoming more sustainable. Interactions between developers, contractors, subcontractors, and suppliers make the environmental impact of a project hard to measure, much less control. According to Forbes, “when it comes to sustainable sourcing of required raw materials, just over half (55%) of engineering and construction companies have significant or complete visibility into their own processes, and only 16% have the same visibility into their suppliers’ processes.” Cost is also a major issue; in the same survey, half of the engineering and construction executives identified cost as the biggest obstacle to becoming more sustainable.

Still, the advantages of green construction continue to become more compelling. Making buildings and construction processes more energy efficient mitigates environmental impact while also cutting costs. Demand among customers and investors for sustainable buildings has grown, as has government regulation of the industry, applying additional pressure on companies to decrease their carbon footprint. With the increasing pressure to reduce environmental harm, companies have begun to dedicate more resources toward green building projects. Green building is defined by the U.S. Green Building Council as the “designing, constructing, and operating [of] buildings to maximize occupant health and productivity, use fewer resources, reduce waste and negative environmental impacts, and decrease life cycle costs.” Certification and rating systems also provide incentives for companies to focus on more environmentally friendly projects. For example, LEED (Leadership in Energy and Environmental Design) ratings consider the impact on climate change, human health, natural resources, and more, and award levels of certification based on a company’s performance. GRESB is another organization that scores companies based on ESG (environmental, social, and governance) data.

In the North Carolina construction and real estate sector, two companies taking the initiative to become more sustainable are Samet Corporation and Grubb Properties. Founded in 1961 in High Point, North Carolina, Samet Corporation provides services in construction, general contracting, and real estate development. The company emphasizes equity and diversity, sustainability, and giving back to the community through its Corporate Social Responsibility program. Likewise, Grubb Properties strives to have a positive impact on the community and the environment through its ESG initiatives and pursuance of certifications such as LEED, NGBS (National Green Building Standard), and ENERGY STAR. It also pursues an annual GRESB assessment. Founded in 1963, Grubb Properties is a real estate investment and management company focused on essential housing. Both companies have a strong presence in NC and are committed to making their businesses more sustainable.

Clay Grubb, CEO of Grubb Properties, and Tiffany King, Regional Sustainability Director of Samet Corporation, will discuss how their companies are stepping into the sustainability space as part of the 2023 UNC Cleantech Summit. The summit, which will take place on March 27-28 at the Friday Conference Center in Chapel Hill, NC, will feature a fireside chat between the two leaders as they discuss how their companies are embarking on the sustainability journey.

About the Author

This article was written by Melanie Gall, a sophomore at UNC-Chapel Hill majoring in Statistics and Analytics and Environmental Science and minoring in Public Policy. She is an IE Cleantech Corner Initiative intern involved in planning the 2023 UNC Cleantech Summit. Connect with her on LinkedIn.