5 ways to reduce energy consumption across your real estate portfolio

Improve net operating income (NOI). Meet environmental, social, and governance (ESG) goals. Achieve net-zero emissions. De-risk your portfolio. Whatever your motivations are for transforming your portfolio into sustainable real estate, one of the most efficient ways to get there is by reducing energy consumption.

Here are five key ways to cut energy use across your real estate footprint.

1.    Turn off the lights

It’s 2:00 a.m. on a Sunday in one of your office buildings, and the lights are on, even though no one has been there for more than a day. That’s wasted electricity. Your property manager can poll the tenants to determine which lights should stay on for safety and which can be shut off or put placed on motion- or time-controlled sensors. Excessive light creates light pollution—and lightbulbs (even eco-friendly ones) generate heat and raise inside air temperatures (which you then have to offset with your cooling/HVAC system).

2.    Switch to LEDs

Compound your lighting savings by switching to all LEDs. Per the U.S. Department of Energy, LEDs use up to 90% less energy and last up to 25 times longer than traditional incandescent bulbs. LED tech for commercial uses has expanded rapidly in recent years to replace incandescent, halogen, and fluorescent lighting. Prices for LEDs have also tumbled, making them a smart, high-ROI choice for lowering your energy use.

3.    Use occupancy sensors

Optical sensors that detect when spaces are empty or occupied—or whether the space is being used actively or passively (for example, when a day-long meeting adjourns for lunch) offer data-driven ways to cut your energy spend. Occupancy data can be used to automate air temperature and lighting to align with occupancy and utilization patterns. Then, use this information to adjust water heater/boiler operations—there’s no need for hot water when no one’s on a given floor or in the building at all.

4.    Monitor air quality

Clean air makes for a happy HVAC system. Poor indoor air quality clogs filters faster. Plus, it can negatively impact tenant comfort. For example, 75º at 70% humidity is significantly less comfortable than 75º at 50% humidity. Measure indoor air quality and temperature, and then combine that information with utilization data to ensure optimal HVAC operations and keep tenants comfortable—so they don’t crank down the thermostat (and crank up energy costs) unnecessarily.

5.    Optimize your HVAC with AI

An AI-powered platform that optimizes your HVAC system and makes micro-adjustments in response to real-time conditions can significantly reduce total energy consumption. In one real-world example, a company realized 20% in total energy savings. Extrapolated across your entire real estate portfolio, that means major reductions in energy expenses—without sacrificing tenant comfort.

Conclusion

Cutting energy use in your buildings makes your real estate portfolio significantly more sustainable. It also furthers your ESG and net-zero efforts, boosts your NOI, and makes your buildings more attractive to current and prospective tenants: A recent JLL study revealed that greener buildings command a rent premium of 6% and a sales premium of 7.6%.