The Impact of ESG Performance on Investors' Decision-Making in the Real Estate Industry: Based on Green Building Certification and Facility Management

With the global climate problem escalating, the real estate investor's environmental awareness is gradually rising, and financial returns are no longer the only consideration for investors, who are increasingly interested in the real estate industry's performance on the environmental level. This paper focuses on the impact of real estate practices in green building certification and facility management on investors' economic returns and environmental considerations. The study shows that improved environmental, social and governance (ESG) performance not only increases property values and rent levels, but also improves tenant satisfaction and lease renewal rates, which in turn enhances the competitiveness of the real estate market, and thus ESG performance improvement has a positive effect on investors. However, the existing leadership in energy and environmental design (LEED) certification for green building certification still has some limitations in terms of actual energy efficiency assessment and LEED's assessment criteria, which need to be further optimized. In addition, the introduction of edge computing in this paper is superficial and weakly referential to the practice of real estate industry, but it can be used as a general direction to enhance ESG performance.

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Publication Details

Journal
Highlights in Business Economics and Management
Published
2024-12-24
DOI
https://doi.org/10.54097/by2v3s39
Primary Topic
Sustainable Building Design and Assessment
Type
article
Field-Weighted Citation Impact
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article

The Impact of ESG Performance on Investors' Decision-Making in the Real Estate Industry: Based on Green Building Certification and Facility Management

Yilin Liu
Highlights in Business Economics and Management
Sustainable Building Design and Assessment
article

The Impact of ESG Performance on Investors' Decision-Making in the Real Estate Industry: Based on Green Building Certification and Facility Management

Yilin Liu
article en

Abstract

With the global climate problem escalating, the real estate investor's environmental awareness is gradually rising, and financial returns are no longer the only consideration for investors, who are increasingly interested in the real estate industry's performance on the environmental level. This paper focuses on the impact of real estate practices in green building certification and facility management on investors' economic returns and environmental considerations. The study shows that improved environmental, social and governance (ESG) performance not only increases property values and rent levels, but also improves tenant satisfaction and lease renewal rates, which in turn enhances the competitiveness of the real estate market, and thus ESG performance improvement has a positive effect on investors. However, the existing leadership in energy and environmental design (LEED) certification for green building certification still has some limitations in terms of actual energy efficiency assessment and LEED's assessment criteria, which need to be further optimized. In addition, the introduction of edge computing in this paper is superficial and weakly referential to the practice of real estate industry, but it can be used as a general direction to enhance ESG performance.

Highlights in Business Economics and ManagementVol. 45
McGill University (CA)
Openalex Percentile: Top 74%
Sustainable Building Design and Assessment
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The Impact of ESG Performance on Investors' Decision-Making in the Real Estate Industry: Based on Green Building Certification and Facility Management — Yilin Liu · Highlights in Business Economics and Management (2024) | TGRS Research Map | TGRS