Besides property technology (proptech), which is fast gaining global application, the next initiative that is currently defining the future of real estate, particularly housing, is green building and branding/ certification which ensure construction efficiency and sustainability.
In other economies, including Ghana, green building, which incorporates design techniques, technologies, and materials that reduce dependence on fossil fuels and negative environmental impact, is common, but Nigeria is still playing a catch-up, especially in residential developments.
Apart from the economic sense which building green makes with about 20 percent reduction in energy, water and material cost, branding or certifying a building also makes business sense to developers through product differentiation that sets them apart from the crowd.
This explains the commitment of the International Finance Corporation (IFC), a member of the World Bank Group, to their global green building standard and certification programme called EDGE which is an acronym for Excellence in Design for Greater Efficiencies.
The corporation has been trying, in the last couple of years, to promote the EDGE programme to Nigeria developers . At a one-day IFC’s EDGE Discovery Workshop hosted in partnership with GreenSquareMetre in Lagos recently, Dennis Quansah, IFC Lead for EDGE, Nigeria and Ghana, offered useful insights on the programme.
“For a building to be certified as green according to our EDGE green building standard, it must achieve a 20 percent reduction in both energy and water consumption, as well as 20 percent less embodied energy in the materials used in construction,” he said, announcing that EDGE was being implemented in over 140 countries around the world.
In additional to lower building operating costs, developers who building and brand green enjoy the benefit of getting global branding opportunities as certified projects are celebrated across all official EDGE digital media platforms including Facebook, LinkedIn and Twitter.
Also IFC’s EDGE software and certification standard offers the benefit of reducing transaction costs for accessing green finance and is ideally suited for raising finance through green bonds, as EDGE already complies with standards such as the Green Bond Principles.
“Such developers get recognition by international development partners including the UN, World Bank and IFC (and climate investors) for measurable reductions in resource use, mitigating the potential effects of climate change in Nigeria, and contributing to the achievement of the Sustainable Development Goals (SDGs),” Quansah assured.
There are also significant opportunities that building and branding green avail developers. In his presentation at the workshop, Shaninomi Eribo, CEO, GreenSquareMetre and EDGE expert, quoted IFC CEO, Philippe Le Houérou, as saying that out of a total $29.4 trillion Climate Investment potential up to 2030 in emerging markets, there is a $24.7 trillion investment potential for green buildings alone which represents 84 percent of the total climate investment opportunities.
Eribo, an EDGE green building expert licensed by the IFC to provide green building advisory services to property developers interested in certifying their projects as green, added that, in its analysis of 21 emerging markets, the IFC’s Climate Investment Opportunities Report estimates the commercial investment potential in the construction of low-carbon buildings in Sub-Saharan Africa at nearly $153 billion, with Nigeria’s climate smart investment potential at $104 billion from 2016–2030 in selected sectors.
“IFC itself has committed about $300 billion in green building investments over the same period. This includes green bonds and green mortgages and other blended finance instruments”, he said, adding, “beyond residential developments, green building investment opportunities also extend into retail, hospitality, medical, office and education projects.”
CHUKA UROKO
