Business Continuity ESG Blog

Biodiversity & CRE Development: Balancing Growth & Ecology

Written by William Tygart | 12/18/24 5:31 PM

Introduction

The commercial real estate (CRE) sector plays a vital role in economic growth, providing spaces for businesses to thrive and shaping the urban landscape. However, CRE development can significantly impact biodiversity, the variety of life essential for healthy ecosystems and human well-being. This report explores the intricate relationship between CRE development and biodiversity, examining the impacts, challenges, and strategies for minimizing environmental harm while promoting ecological conservation.

The Impact of CRE Development on Biodiversity

CRE development can affect biodiversity through various pathways. Jonathan Watts highlighted the connection between extractive industries, which supply many of the raw materials for construction, and biodiversity loss. Watts found that extractive industries are responsible for around 50% of global carbon emissions and over 80% of biodiversity loss1. Over the past five decades, the rate of global resource extraction has undergone rapid expansion. In the initial...source habitat loss and fragmentation, disrupting ecosystems and displacing species2.

  • Habitat degradation: Construction activities, pollution, and the introduction of invasive species can degrade the quality of remaining habitats, making them less suitable for native wildlife3.
  • Climate change: Buildings contribute significantly to greenhouse gas emissions, exacerbating climate change, which further threatens biodiversity through altered temperatures, precipitation patterns, and increased extreme weather events4.

Specific examples of how CRE development affects biodiversity include:

  • Light pollution: Artificial lights from buildings disrupt the natural day-night cycle, affecting nocturnal animals' behavior and physiology5.
  • Noise pollution: Construction noise and traffic can disturb wildlife, interfering with communication, foraging, and breeding6.
  • Soil and water contamination: Runoff from construction sites can carry pollutants into nearby water bodies, harming aquatic life.
  • Introduction of invasive species: Construction materials and landscaping can introduce non-native species that outcompete native wildlife and disrupt ecological balance5.

The Relationship Between CRE Development and Biodiversity

The relationship between CRE development and biodiversity is complex and multifaceted. While development often leads to biodiversity loss, it can also present opportunities for ecological conservation and enhancement7. Recognizing the interconnectedness of the built environment and natural ecosystems is crucial for sustainable development. There is a growing awareness of biodiversity as a key factor in ESG (Environmental, Social, and Governance) considerations for real estate investment8. Investor demand and regulatory pressures are driving the integration of biodiversity in CRE development.

The World Economic Forum emphasizes the economic value of biodiversity, with approximately half of the world's GDP moderately or highly dependent on nature7. Biodiversity is essential for food security, providing the genetic diversity needed to develop new crops, breeds of livestock, and fisheries9. Biodiversity loss can lead to a reduction in food production and make our food systems less resilient to shocks such as pests, diseases, and climate change9. Biodiversity is a significant source of economic value through industries such as pharmaceuticals, consumer products, tourism, and recreation9. Biodiversity loss can have significant economic impacts, particularly for communities that rely on these industries9.

Protecting and enhancing biodiversity within CRE development can contribute to long-term economic value by:

  • Improving property values: Green spaces and biodiversity features can enhance the attractiveness and marketability of CRE properties8.
  • Reducing operational costs: Sustainable design and landscaping can reduce energy and water consumption, leading to lower operating expenses.
  • Enhancing tenant well-being: Access to nature and green spaces has been shown to improve physical and mental health, increasing productivity and satisfaction among tenants10.
  • Mitigating climate risks: Biodiversity conservation can contribute to climate change mitigation and adaptation by enhancing carbon sequestration and ecosystem resilience7.

Green Building Certifications and Standards

Green building certifications and standards play a crucial role in guiding and incentivizing sustainable practices in CRE development, including biodiversity conservation. Several prominent certifications and standards address biodiversity considerations:

  • LEED (Leadership in Energy and Environmental Design): LEED is a globally recognized green building certification system that evaluates buildings on various sustainability criteria, including site development, water efficiency, energy efficiency, materials selection, and indoor environmental quality. LEED promotes biodiversity conservation by encouraging the use of native plants, protecting existing ecosystems, and minimizing habitat disturbance11.
  • BREEAM (Building Research Establishment Environmental Assessment Method): BREEAM is another widely used green building certification system that assesses the environmental performance of buildings. BREEAM incorporates biodiversity considerations by evaluating the ecological value of the site, promoting habitat creation and enhancement, and encouraging the use of sustainable materials.
  • SITES (Sustainable SITES Initiative): SITES is a comprehensive rating system for sustainable land design and development. SITES specifically focuses on promoting biodiversity by encouraging the use of native plants, restoring degraded ecosystems, and managing stormwater to minimize impacts on water quality and habitats13.
  • Climate, Community and Biodiversity Standards (CCB Standards): The CCB Standards evaluate land management projects, including CRE developments, to ensure they deliver tangible climate, community, and biodiversity benefits. These standards promote best practices in site selection, design, and management to minimize environmental impacts and enhance ecological value14.

Many CRE projects have successfully achieved these certifications, demonstrating the feasibility and benefits of integrating biodiversity considerations into development. For example, the Palisades Office Park achieved LEED and ENERGY STAR certifications and installed a 1-Megawatt solar array at the property, improving not only environmental sustainability but its tenant satisfaction as well15.

Strategies for Minimizing Environmental Impact and Promoting Ecological Conservation

Minimizing the environmental impact of CRE development and promoting ecological conservation requires a comprehensive approach that integrates biodiversity considerations throughout the development process. Key strategies include:

1. Site Selection and Planning

  • Prioritize brownfield development: Redeveloping previously developed land can reduce pressure on green spaces and minimize habitat loss16. For example, the Westfield Hamburg-Überseequartier project in Germany was built on former industrial land, incorporating green roofs, roof terraces, and other biodiversity-enhancing features17.
  • Conduct thorough ecological assessments: Identify existing habitats, species, and ecological features to inform site design and minimize impacts18.
  • Incorporate ecological connectivity: Consider the surrounding landscape and plan for connectivity between natural areas to facilitate wildlife movement and gene flow19.
  • Incorporate biodiversity conservation into large-scale development: The Rancho Mission Viejo community in Orange County, California, dedicated around 75 percent of the site's 23,000 acres as a nature reserve. This not only provided a major sales draw but also satisfied local wildfire resiliency requirements2.

2. Building Design

  • Minimize footprint and building height: Reduce the overall impact on the site by optimizing building design and minimizing impervious surfaces20.
  • Incorporate green infrastructure: Integrate green roofs, vertical gardens, and other green infrastructure elements to provide habitat, improve stormwater management, and reduce the urban heat island effect21. For example, the Oasia Hotel Downtown in Singapore features a lush green facade with vertical gardens and native plantings, creating a thriving urban ecosystem21.
  • Use sustainable and locally sourced materials: Minimize the environmental impact of construction by using materials with low embodied carbon and sourcing them locally22.

3. Landscaping and Site Management

  • Prioritize native plants: Use native species in landscaping to support local wildlife, reduce water consumption, and minimize the need for pesticides and fertilizers23.
  • Create diverse habitats: Incorporate a variety of plant species and structural elements to provide habitat for a range of wildlife24.
  • Implement sustainable landscaping practices: Minimize the use of pesticides and fertilizers, and implement water-efficient irrigation systems23.
  • Use native/wildlife-friendly landscaping: Create bioswales, permeable paving, and other water retention mechanisms, and integrate natural areas in building and site architecture25.

4. Measuring Biodiversity

Unlike measuring the carbon emissions of a building or the embodied carbon within its walls and floors, which are comparatively straightforward numeric values, it is difficult to develop a standardized system of values, impacts, and relationships for biodiversity. Species occupy complex, interconnected ecosystems, and assessing the impact of development on these intricate webs of life requires robust measurement frameworks2.

Government Regulations and Policies

Government regulations and policies play a crucial role in promoting biodiversity conservation in CRE development. Key initiatives include:

  • Biodiversity net gain requirements: Regulations mandating a net gain in biodiversity on development sites, such as the UK's 10% net gain requirement, incentivize developers to prioritize ecological enhancement26.
  • Environmental impact assessments: Requiring comprehensive assessments of potential environmental impacts before development can help identify and mitigate risks to biodiversity27.
  • Green building codes and standards: Implementing codes and standards that promote sustainable design and construction practices can contribute to biodiversity conservation.
  • Biodiversity offsets: Biodiversity offsets can be used to compensate for unavoidable biodiversity loss due to development. These offsets involve investing in conservation or restoration projects elsewhere to compensate for the impacts on the development site2.

The Role of NGOs and Community Groups

NGOs and community groups play a vital role in promoting biodiversity conservation in the context of CRE development by:

  • Advocating for conservation policies: Raising awareness and advocating for stronger regulations and policies that protect biodiversity28.
  • Engaging in community-based conservation: Implementing local conservation projects, restoring habitats, and monitoring biodiversity29.
  • Collaborating with developers: Working with developers to integrate biodiversity considerations into projects and promote sustainable practices30.
  • Tree Planting Initiatives: NGOs play a crucial role in promoting sustainable development through tree planting initiatives. Trees foster biodiversity by providing habitats for a myriad of flora and fauna, bolstering the resilience of our fragile ecosystems31.

Challenges and Opportunities

Integrating biodiversity considerations into CRE development presents both challenges and opportunities. One major challenge is the complexity of measuring biodiversity and developing standardized metrics for assessing its impact2. This requires robust measurement frameworks and collaboration among stakeholders to effectively track and manage biodiversity. Another challenge is navigating the regulatory landscape, which can vary significantly across jurisdictions.

However, the opportunities associated with biodiversity conservation in CRE development are substantial. By prioritizing biodiversity, developers can enhance property values, reduce operational costs, improve tenant well-being, and mitigate climate risks8. Moreover, incorporating biodiversity considerations can enhance a company's reputation and attract environmentally conscious investors and tenants.

Conclusion

Balancing economic growth with ecological responsibility is crucial for the long-term sustainability of the CRE sector. The CRE industry needs a paradigm shift towards a more holistic approach that values biodiversity and integrates it into all stages of development. By implementing sustainable practices, collaborating with stakeholders, and embracing innovation and technology, the CRE industry can contribute to a future where built environments and natural ecosystems thrive in harmony. Stakeholders across the CRE sector must embrace biodiversity as a core principle for a sustainable and prosperous future.

Works cited

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