Going Green for Earth Day
Four ways companies can make their commercial facilities more sustainable
Real estate is one of the biggest CO2 emitters, with buildings accounting for 30-34% of global energy consumption. This makes it a critical sector in the global effort to reduce carbon emissions and combat climate change. Fortunately, there are many solutions available to help reduce the carbon footprint of real estate, while also reducing energy costs, improving building safety and boosting operational efficiency.
With Earth Day around the corner, this article discusses several of the most impactful changes companies can implement to make their buildings more sustainable.
Install Solar Panels
One of the most effective sustainable upgrades for commercial facilities is the installation of solar panels to a roof or carport. Solar panels provide a clean source of energy and can help companies save on their cost of power. Additionally, companies may be able to receive renewable energy credits for offsetting carbon emissions depending on their location of operation.
Companies who install solar panels can minimize their carbon footprint and contribute to the wider goal of reducing greenhouse gas emissions. It can also help them achieve their corporate sustainability goals and align with the growing interest in ESG broadly among stakeholders, including investors, customers and employees.
Upgrade to LED Lighting
A simple step that companies can take to improve a building's sustainability is switching to light-emitting diode (LED) bulbs. LEDs produce light up to 90% more efficiently than other types of light bulbs, which can significantly reduce energy consumption. Additionally, LEDs do not need to be replaced as often as incandescent or fluorescent bulbs, lasting as long as 14 years in a building which uses lighting for approximately 10 hours each day.
LED lightbulbs are a more sustainable option not only due to their efficiency and longevity, but also because they do not have the environmentally hazardous materials incandescent bulbs contain (including argon and xenon gases). LED lights also give off very little heat compared to other types of lighting, therefore helping reduce a building’s temperature and limiting the power load on its mechanical systems.
The payback period for an LED retrofit is shorter than many other sustainable upgrades, making it a great starting point for companies looking to make their buildings more efficient.
Invest in Water Recycling
Climate change has caused water scarcity to become an increasing issue of concern. As a result, water recycling has emerged as a viable option to provide a sustainable source of water in commercial facilities.
A leading option for reducing water waste and preserving this vital resource is to recycle greywater. Greywater refers to lightly used water from sources such as sinks, showers and washing machines. Instead of directing this water into the sewer system, facilities can instead treat it and repurpose it for non-potable uses such as toilet flushing and irrigation. Instead of wasting freshwater, recycled water can be used when potable water is not needed.
By harnessing the latest technology, water recycling has the potential to revolutionize the way we manage water waste and conserve this precious resource. As water scarcity becomes an increasingly pressing issue, water recycling will be an important step companies can take to make their buildings more sustainable.
Utilize IoT Sensors
As businesses leverage technology to help them operate more sustainably, integrating Internet of Things (IoT) technology has proven valuable in helping companies manage building efficiency on a daily basis. In particular, IoT sensors can collect data and bridge the gap between the digital and the physical world, helping companies gather information on things like energy consumption, temperature, air quality and occupancy levels.
For instance, IoT sensor data can help promote sustainability by helping companies monitor energy consumption and manage power usage. IoT sensors can also be vital in helping continuously monitor particulate matter (PM) concentrations and other chemicals, gasses and contaminants in the air, allowing companies to take measures to improve occupational safety and reduce greenhouse gas emissions.
Lease Your Real Estate? Partner With Your Landlord!
Implementing sustainability initiatives can make a huge difference in reducing a building’s carbon footprint. Companies that lease their real estate may think implementing these changes isn’t possible, but that may not be the case. Leveraging their landlord relationship is a great way to explore options for sustainable building improvements.
W. P. Carey is a leading real estate investor with a portfolio of over 1,400 properties, and recently launched a suite of sustainability and efficiency offerings for its tenants. With no upfront costs, W. P. Carey can help tenants manage the implementation of sustainability projects such as solar, LED lighting and smart metering, which can save money, reduce carbon emissions and benefit the environment. Contact W. P. Carey today to learn more!
Related Topics:
You May Also Like:
The Future Is Green
As the real estate industry evolves, sustainability continues to be recognized as a key consideration shaping investment strategies, tenant expectations and development practices. From carbon-neutral construction to community solar, the sector is embracing innovative solutions that promise both environmental and economic returns. Here are three sustainability trends shaping the real estate industry in 2025. Community Solar: Expanding Access to Renewable Energy One of the most impactful trends is the rise of community solar programs, where a building’s solar installation can extend renewable energy access to businesses and residents who might not be able to install solar themselves due to factors like limited rooftop space, shading, outdated electrical systems or high costs. In the last decade, community solar in the U.S. has grown about 80% annually and is projected to double from 2023 to 2028 to 14 GW (CBRE). This energy is usually sold at a slight discount to local subscribers, creating value in the community. Beyond financial returns, community solar improves grid resilience and reliability while decreasing dependence on fossil fuels. It also gives utility providers a way of locating power generation near their load centers and offtakers. Instead of buying power from a power plant that’s miles away and building transmission lines to the building, community solar locates power generation where people live. W. P. Carey is actively advancing community solar applications in several states. Carbon-Neutral Construction: Building with Purpose The construction phase of a building’s lifecycle presents a critical opportunity to reduce emissions. Investors and developers are increasingly conducting life-cycle carbon assessments and integrating carbon-neutral design standards into new builds and redevelopments. By engaging sustainability consultants early in the process and selecting materials with reduced embodied carbon, firms are minimizing environmental impact while enhancing long-term asset value. Industry wide, the low-carbon building market is projected to grow from about $655 billion in 2024 to nearly $1.6 trillion by 2034 – a compound annual growth rate (CAGR) of 11.8% (Zion Market Research). In 2024, W. P. Carey completed its first carbon-neutral construction project. During the development process, WPC prioritized lower-carbon concrete, locally sourced materials and the reuse of demolition materials on-site. To address the remaining embodied emissions, W. P. Carey procured high-quality, third-party verified carbon credits, following the standards set by the Integrity Council for the Voluntary Carbon Market (ICVCM). For more information, read the case study here. Net Zero Buildings: The Gold Standard Net zero buildings, which generate as much energy as they consume, are becoming the benchmark for sustainable development. These properties leverage energy-efficient technologies, solar energy and smart building systems to achieve operational neutrality. Net zero buildings offer benefits for owners, tenants and the environment, including reduced operating costs, healthier indoor air quality, better temperature control and a reduced carbon footprint. Net zero buildings are inherently more resilient and often command higher asset values. Globally, the net zero building market is projected to grow at a CAGR of nearly 20% annually from 2022 through 2030, driven by corporate climate commitments and tightening building codes (KD Market Insights). Conclusion: A Sustainable Path Forward The momentum behind sustainability in real estate is no longer aspirational – it’s actionable. For commercial real estate owners, the adoption of these sustainable solutions not only enhances asset values and meets evolving tenant demands but also opens new revenue streams and aligns with investor expectations. Real estate investors who embrace these opportunities are positioning themselves at the forefront of a sustainable future, where profitability and planet-positive outcomes go hand in hand. Interested in learning more about W. P. Carey’s commitment to sustainability? Read our most recent Corporate Responsibility Report.
Financing Sustainable Real Estate Through Sale-leasebacks
Financing sustainable building upgrades can be a daunting and expensive endeavor for many businesses. The upfront costs associated with sustainable materials, energy-efficient systems and eco-friendly designs often deter companies from pursuing these environmentally beneficial projects, even when they know there are long-term cost savings. Sale-leasebacks offer an effective solution to this challenge. By selling their real estate to an investor and leasing it back, companies can unlock capital which they can invest in sustainability upgrades, improving the quality of their building and often lowering operating costs. Landlords, like W. P. Carey, are also typically supportive of sustainability-focused building upgrades as they increase the overall value of the building. Here are several ways companies can leverage sale-leaseback financing to make their buildings more sustainable. Solar panel installations and green roofs One of the most effective sustainable upgrades for commercial facilities is installing solar panels on a roof or carport. Solar panels provide a clean source of energy and can help companies save on power costs. They also reduce over-reliance on the grid during peak periods when electricity demand is high and clean up the grid, providing a renewable and cost-effective alternative to fossil fuels. Depending on the location, companies may also be able to receive Renewable Energy Credits (RECs) or Guarantees of Origin (GOs). Another sustainable upgrade that can provide both environmental and economic benefits is a green roof, also known as vegetated or living roof. These are roof systems covered with waterproofing membrane, soil and vegetation. Green roofs can significantly improve stormwater management, reduce urban heat island effect, boost biodiversity by providing a habitat for plants and animals, and improve building energy efficiency. Both solar panels and green roofs are a great way to make a building more sustainable and help reduce energy costs for the tenant, but they require significant investment. By utilizing sale-leaseback financing, companies can easily unlock the capital they need to invest in these improvements. Sustainable construction For companies who are looking for a brand-new building and want to prioritize sustainability, a build-to-suit, which uses the sale-leaseback structure, is a great solution. Through a build-to-suit, a company can secure a custom-built, sustainable facility without the upfront capital investment. An investor funds and manages the construction of the new facility to meet the specifications of the future tenant, and upon completion, the company enters into a long-term lease. During the build-to-suit planning, companies can specify that they want to utilize sustainable construction, which means using recyclable and renewable materials during the building process as well as minimizing energy consumption and waste production. In addition, the building can be designed to minimize its carbon footprint by incorporating elements and materials that have a continuous positive influence on the environment. These features can include electric-vehicle charging stations, drought-resistant landscaping, heat pumps, appropriate insulation to prevent heat loss and greywater recycling. Energy-efficiency upgrades Implementing sustainable features to improve energy efficiency significantly impacts a property's life-cycle emissions. These upgrades are often relatively easy to implement but can be costly to install. By unlocking capital through a sale-leaseback, companies can extract the cash they need to invest in these improvements, making their building more sustainable and saving on energy costs in the long run. One example of an energy-efficiency upgrade is installing Internet of Things (IoT) technology, including smart meters, which help companies manage building efficiency on a daily basis. IoT sensors can gather information on energy consumption, temperature, air quality and occupancy levels, enabling tenants to best optimize the efficiency of their buildings. Companies can also leverage the capital from a sale-leaseback for building systems upgrades. Upgrading an outdated heating, ventilation and air conditioning (HVAC) system can help decrease utility consumption and create maintenance cost savings for the tenant. W. P. Carey can help While the financial burden of sustainable building upgrades can be substantial, sale-leasebacks provide a viable and strategic solution. Embracing this approach allows companies to align their environmental goals with their economic objectives, paving the way for a greener and more prosperous future. W. P. Carey is one of the largest net lease real estate investors and has significant experience working with companies on sale-leasebacks and sustainability solutions. If you’re interested in learning more, contact us today!
Tenant Partnerships – The Road to a Sustainable Future
As Climate Week NYC approaches, the spotlight on sustainability is brighter than ever. For companies across industries, the annual event underscores the urgent need to address climate change. The real estate sector, estimated to be responsible for nearly 40% of global carbon emissions, plays a critical role in advancing this worldwide effort. At W. P. Carey, we recognize our potential to drive meaningful impact in the fight against climate change through our extensive portfolio of over 1,200 net lease properties. While the net lease model means our tenants have full operational control of their properties, we are committed to collaborating with them to achieve shared sustainability goals and enhance the quality of our properties. Here’s how: Gaining insights through data Collecting detailed energy data remains a core focus for us. Collaborating with our tenants to install IoT smart meter systems provides both us and our tenants access to high-quality utility data for their leased properties. This data can be utilized to assess energy usage for regulatory compliance as well as voluntary reporting. It also enables us to calculate the carbon footprint of our portfolio and identify opportunities to implement energy-saving measures at our properties. In 2023, we began a smart meter installation program with our European tenants, making the process more efficient for both W. P. Carey and our tenants while also reducing the risk of data errors. Renewable energy opportunities Renewable energy can reduce building operating costs and lower carbon emissions. One of the most accessible sources of renewable energy is solar power, which can be harnessed through the installation of solar panels. Particularly given the roof space that our industrial and warehouse assets provide, we believe we have a large addressable market for solar. Through W. P. Carey’s CareySolar® program, tenants have the opportunity to take advantage of rooftop and carport solar installations at their leased properties through a broad array of structures. These include: Landlord-operated Landlord-financed Tenant projects Rooftop leases W. P. Carey collaborates with each tenant to understand their current energy usage and determine the ideal solar solution for their unique property. In 2023, W. P. Carey extended the lease term with an existing tenant for their 265,000-square-foot industrial facility in Illinois. Simultaneously, we signed a 15-year power purchase agreement where we plan to build a 1,350-kilowatt roof mounted solar system that would offset 740 metric tons of CO2 annually. We will manage and fund the construction of the system and sell the power generated by the system to the tenant. Building energy retrofits Implementing sustainable features to improve energy efficiency has a huge impact on a property’s life-cycle emissions. W. P. Carey can do this through property-specific energy retrofits. An example of an energy retrofit is the installation of LED lighting. LED lights are 80% to 90% more energy efficient than other light bulbs and do not contain any environmentally hazardous materials. Additionally, LEDs last up to 25 times longer than traditional incandescent bulbs. In 2023, W. P. Carey completed a full LED retrofit at our 1.5 million-square-foot warehouse in University Park, Illinois. The LED project is expected to result in a 35% reduction in lighting electricity usage and 41% reduction in utility and maintenance bills at the property. Following the completion of the retrofit, we leased the property to Samsung for a term of 10.5 years. Green-building certifications Green-building certifications such as LEED and BREEAM can provide many benefits for both landlords and tenants. Achieving a green-building certification means that a property meets certain sustainability requirements across a variety of categories including energy, air quality and water usage. Certified buildings are typically more energy and cost efficient and create healthier work environments for employees. In addition to being more environmentally friendly, green-certified buildings can offer tax benefits. Many states offer tax incentives for green building projects, based on either energy savings or reaching a certain level of certification. Real estate studies have also shown that green buildings sell and lease faster than traditional buildings, and garner higher rents and lease rates. At W. P. Carey, we’re committed to achieving green-building certifications where we can, and our portfolio includes 6.6 million square feet of green-certified buildings as of June 30, 2024. In 2024, our state-of-the-art food research facility in the Netherlands received a BREEAM Outstanding certification, the highest level of BREEAM certification for buildings worldwide. Conclusion Reducing the carbon footprint of a net lease portfolio is an enormous challenge, but by bolstering tenant engagement and systematically identifying sustainability opportunities, progress is possible. Sustainable real estate is beneficial to the planet, attractive to tenants and improves the value of our broader portfolio, making it a win-win-win for all.