It has long been known that a significant majority of Europe’s buildings are not fit for purpose in a world of accelerating climate change. Accounting for approximately 40% of the European Union’s total energy consumption and for 36% of its CO2 emissions, the sector has been slow to respond, but is going to be at the forefront of rapid change as Europe targets climate neutrality by 2050 as its political priority, and uses the European Green Deal as its growth strategy. With the sector grappling with the dramatic short-term consequences of the Covid-19 pandemic, EU policy-makers are now targeting massive investment in a ‘Renovation Wave’ as well as an ambitious legislative programme on buildings and construction, including on ESG and sustainability issues, that will immediately and directly impact the real estate industry. How prepared is it for the challenges and opportunities ahead?
Authors: Marcus Pepperell and Raphael Büchel, part of the real estate team at FTI Consulting Brussels