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ESG in Real Estate Valuation 2.0

PWC (2024) | Asset Management, Risk Mitigation, Valuation

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SAM Curated
Jul 10, 2025
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Sustainability has become a pivotal factor in real estate valuation, driven by regulatory frameworks, capital market pressures, and ESG integration. Certified green buildings, such as those with BREEAM or NABERS ratings, consistently show rental and value premiums—up to 18%—highlighting the financial benefits of energy-efficient assets. Regulatory developments like the EU Taxonomy and CSRD mandate sustainability assessments across construction, financing, and operations, while national laws increasingly restrict the use of inefficient buildings.

Between 2021 and 2024, valuation practices have varied, from ignoring ESG factors to applying premiums or discounts based on energy performance certificates. However, these methods often fail to reflect long-term value stability. CRREM pathways offer a more robust framework by aligning valuations with climate targets and identifying stranded assets. Tools like PwC’s Climate Excellence Re…

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