5 ways cities must step up to the net zero challenge

Cities need to act on bold commitments to go further and faster in the coming years

November 11, 2021
  • Jeremy Kelly

The leaders of today’s cities are only too aware of the need to decarbonize the built environment and limit global warming.

Nobody wants to see homes underwater, infrastructure melting in extreme heat or fires burning uncontrollably. Yet this is what is happening far too frequently.

So now, many city governments worldwide are increasingly taking the lead, often ahead of their national governments, in setting bold net zero commitments. Real estate in particular, has a key role to play. In some cities, buildings can account for up to 80 percent of carbon emissions.

But commitments alone aren’t enough. These ambitious targets must be the end goal of comprehensive action plans that will deliver real on-the-ground change to reduce carbon emissions and waste, lower pollution, boost biodiversity and ultimately make cities more sustainable and resilient.

What does this mean for city governments and city stakeholders?

1. Prioritize decarbonizing buildings in climate action plans

Cities can’t achieve the ambitious emissions targets they’re setting without proactive programs to significantly decarbonize buildings. While cities such as New York, Los Angeles, Paris, Copenhagen and Melbourne are taking action, there’s a sense that city administrations more broadly are not doing enough. JLL's Responsible Real Estate Survey reveals that only 29 percent of investors and occupiers strongly agree that top-tier cities are taking sufficiently bold action to mitigate climate risk. They would like to see stronger action, particularly in the greening of local energy grids, over which they have little direct control.

2. Lean into partnerships

The magnitude of the climate change challenge and the urgent need for action means no single stakeholder group, whether in the public or private sector, has the resources or capabilities to achieve net zero on their own.  

We need an ecosystem of partnerships – including property owners, investors, corporate occupiers, governments, academia and community organizations – to work together towards common sustainable targets. City administrations should see real estate owners, developers, investors and occupiers as long-term partners that can help achieve goals which will ultimately benefit us all.    

3. Tackle the retrofitting challenge

Retrofitting a city’s existing building stock is critical to its decarbonization drive. Yet the retrofitting challenge can be both costly, when it comes to machinery and materials, and complex, with many suppliers involved. What’s more, the current pace of retrofitting – at around 1 percent to 2 percent in mature cities – isn’t anywhere near fast enough.  

Governments and the real estate industry must work collaboratively to identify solutions and incentives to help drive the sustainable transformation of existing assets and encourage the uptake of clean energy. For real estate owners, it will be increasingly about value preservation as much as value creation. The risk of brown discounts or even stranded assets will be top of mind.  

4. Facilitate knowledge sharing and upskilling

City governments – in partnership with leading real estate investors and occupiers, universities and local green building councils – have an important role to play in educating and disseminating know-how, particularly to smaller companies and property owners. Most companies are still at an early stage in their decarbonization journey and, while they’re committed to the task at hand, they often lack the resources and knowledge to take action.

5. Leverage technology to progress decarbonization

Technology is a key enabler in driving the transition to net zero. Data is probably the single biggest catalyst for green progress, with enhanced data capabilities providing opportunities for continuous improvements. Data and technology are also essential for transparent reporting and holding companies to account amid growing calls of greenwashing.  

Once again, strong partnerships between governments, academia, real estate and the proptech sector are essential. They’re needed to fund more R&D and to help scale the best innovations within commercial settings. JLL, for example, is collaborating with MIT in a Tech Tracker, a program to understand the cutting-edge science and innovations that will potentially transform real estate in the future.

Bridging the gap between intent and action

City governments will need to employ a wide armoury of tools to decarbonize the built environment, from transforming long-established transport norms to bringing nature back into urban areas and championing renewable energy. It will take both carrots and sticks. But whatever the route, the 2020s will be critical in powering the huge changes needed to lay the groundwork for a low-carbon future.  

That requires teamwork, where we genuinely support and learn from each other. It’s no longer enough to just talk about what we need to do next. More than ever, we need coordinated and urgent action today to make our cities fit for tomorrow.