Real estate’s impact on the environment is substantial: buildings are responsible for nearly 40 percent of global carbon emissions according to the World Economic Forum. In response, environmental champions within the industry have upskilled and assigned resources to create energy efficiency and sustainability initiatives. However, to meet ambitious net zero goals, the industry must do a better job of collaborating – across organizations, the supply chain and the entire industry. Facility managers have a critical role in the process, one which can earn them a well-deserved seat at the corporate table. An FM is the conduit for collaboration between tenants, the property owner and their external business partners to reduce a building’s emissions. It starts with the data, and the information derived from the data empowers decisions.

With an increasing number of organizations deploying a hybrid work strategy, there has never been a better time for tenants and landlords to reevaluate energy usage needs. This shift places FMs in a pivotal role of data collection to assess usage and reassess corporate workspace needs over the longer term. 

The Road to net zero

To meet net zero carbon emission goals by 2050 as outlined in the Paris Climate Accord to reduce temperature rise below 1.5 degrees Celsius (2.7 degrees Fahrenheit) requires a decarbonization path for each property that aligns with the organization’s established goals. Energy conservation and improving efficiency at the property level is the starting point for reaching these decarbonization goals, and FMs are uniquely positioned to be facilitators of data exchange between tenants and owners. FMs are on the frontline – they know the capabilities of data collection systems already in place and where gaps exist that need to be filled to improve consistency, accuracy and transparency across the asset life cycle and supply chain. Their engagement with external business partners, such as software vendors, service providers and consulting firms who work with tenants, owners or both, is a critical contributor to advancing progress on the road to net zero. Establishing common ground and acknowledging the common need for better communication and collaboration between the parties on energy usage are needed to make progress on emissions goals, which creates a new and important role for FMs.

Consumption and conservation are the next steps and require a partnership between tenants and owners to improve usage. For example, identifying tenants with similar space requirements, utilization and business type at a specific property provides opportunities for FMs to educate tenants and share data that can help model behavior and energy saving steps to improve carbon footprints and save on operating costs. Corporate tenants and owners share responsibility for collecting, analyzing and reporting data that addresses scopes 1, 2 and 3 emissions.

OSCRE Environmental Data Standards ProjectUsage patterns available from utility billings can be tied to specific building systems including HVAC. Connecting this data with other factors including occupancy and weather patterns enables FMs to provide additional insights that can contribute to data analysis, and in turn, contributes to improving energy efficiency and lower operating costs.

Achieving carbon emission targets is a significant commitment, with high stakes for those organizations that meet or exceed established targets. For publicly traded companies especially, it impacts the ability to attract skilled workers and expand the business by attracting additional investment capital. This data is also used in other reporting platforms to compile corporate social responsibility (CSR) reports and anticipated mandatory Securities and Exchange Commission reporting requirements for publicly traded corporations that are currently in the rulemaking phase, and benchmarking.

Next step in the process is on-site renewable energy installations and yet another opportunity for collaboration between tenants and owners. Data exchange is an integral part of advancing longer term improvements including solar and other alternative energy sources. A diversified major real estate property manager, owner and investment firm estimated that

Studies show that 65 to 70 percent of an entire building's energy use is attributed to its tenants and acknowledged the need to do better and get better at data sharing and data collection. It also confirms the need for data standards that can be implemented across organizations and the industry.

IFMA’s participation in the environmental data standards project

While FMs can take steps to manage and measure emissions in buildings under their purview, there is little capacity to integrate environmental data across the supply chain due to an inability of these disparate systems to effectively communicate with each other, and an absence of relevant data standards to aid consistency, accessibility and transparency. In a typical scenario, data collected on disparate software platforms is extracted manually and transferred to complex spreadsheets. This creates an opportunity for human error, which is then amplified when shared across organizations for reporting purposes and to aid decision making.

To address this issue, IFMA has partnered with OSCRE International and other organizations to develop environmental real estate data standards to improve consistency for data exchange across platforms. The areas covered by this project include standardizing data related to:

  • Manage facilities
  • Direct emissions policy
  • Collect data from functional owners
  • Data reporting requirements of supply chain
  • Collect data from supply chain
  • Benchmarking
  • Compliance

IFMA’s participants in this project are providing FM perspective framing the content of these standards and confirming the importance of FMs’ role in developing strategies and practices for more effective environmental data management.

To date, significant progress has been made with four out of the seven use cases noted above already drafted, and the development of all the use cases outlined is expected to be completed by mid-summer 2023. The workgroup, which included representatives of IFMA, started by reviewing current data collection practices within an organization and its supply chain. These are the high-level-of-detail use cases associated with service delivery and management. For these use cases, specific existing standards including BEDES, Brick and Haystack have been reviewed and relevant portions will be included in the final product. Key terms and definitions have been mapped from these sources to create as much alignment as possible. For these use cases, a wide range of existing standards have been mapped for reporting, including USGBC, Energy Star, GRESB, IFRS/SASB and others. In common with other reporting frameworks, new areas that will be modeled include energy attribute credits and carbon offsets.

The need for upskilling

The focus on data and real estate’s environmental impact demands an expanded skill set and a critical need for FMs to upskill. Organizations are increasingly recognizing the need to allocate resources to expand knowledge and skills of their workforce to meet these changing needs. They include an understanding of technical applications available and their limitations, the importance of discerning qualitative data versus mass quantities of data available to guide decisions, and fostering an environment and culture that encourages collaboration both internally and with external business partners. The commitment to support upskilling is not a one-and-done approach. It will involve an ongoing allocation of resources to continue to expand the knowledge base of the workforce to evolve with changes in reporting requirements, expectations of occupiers and investors, and public perception. Skills in emerging technologies such as digital twins and artificial intelligence can support emission reduction strategies as they are used to model traceable assets and real or anticipated energy usage.

While environmental concerns are accelerating a greater degree of accountability, FMs’ role as conduits for collaboration across the asset life cycle and the supply chain increases their value and provides a platform for sharing relevant insights to achieve progress. A welcome addition to the expanded role and responsibilities could also include a catalyst for change.

Scopes 1, 2 and 3 Emissions: What do they include?

  • Scope 1 is on-site combustion of fossil fuels --- natural gas boilers, fuel oil used for heating, etc. Some companies have vehicle fleets that would be included within that category.
  • Scope 2 is indirect emissions --- emissions associated with purchased electricity and steam. That includes utility grid electricity, the energy purchased directly from renewable providers and steam that is provided. Scope 3 is all indirect emissions that you do not have control over.
  • Tenant emissions are Scope 3 for owners and investors, and that includes emissions associated with supply chain as well, such as materials that are purchased and the indirect emissions associated with the waste hauling and vehicle travel.

Editor’s note: This article is a part of a strategic partnership between IFMA and OSCRE.