Framework for integrating sustainability issues into valuation of non-market industrial real estates

摘要

This paper builds upon earlier studies and viewpoints relating to sustainability in real estate valuation, summarising the key results into three major valuation approaches. These approaches focused mainly on commercial and residential properties, excluding specialised industrial properties, for which no market-based evidence exists for their valuations. The paper closes the gap by venturing to provide a framework and valuation approach for integrating sustainability issues into non-market industrial real estate valuation. It finds a conceptual framework and a non-market valuation approach that should encourage firms to invest in sustainability, and assign scarcity value to environmental absorptive capacity. The study proposes a Delphi technique which attaches a sustainability obsolescence factor to an industrial operation relative to the appropriate sustainability criteria set by the local green rating or environmental authorities. It concludes that there is an impact-compliance dimension to sustainability in real estate valuation, and that appraisers should give sustainability-compliant opinions to their clients to drive sustainability.