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ā¢ Smart buildings, water, energy, and waste management systems, recycling facilities, development of sustainable materials in ConTech (construction technology), renewable energy transition, air quality monitoring, etc. are the leading ESG innovations in real estate.
ā¢ Technologies like IoT, AI, VR/AR, and data analytics are helping real estate professionals track and monitor building operations in real-time and make buildings compliant with ESG regulations.
ā¢ The market value of ESG rating services in 2024 is over $ 10.37 billion. Growing at a CAGR of 8.25%, the market is expected to reach $ 15.42 billion in 2029.
ā¢ In this podcast, Alaviya Rizvi, EIR, PropTechBuzz discusses the importance of ESG solutions in real estate in combatting global climate change with Srinivas Nag Srirangam, Founder, Prime Estate Global Solution Limited.
ā¢ Prime Estate Global Solutions is engaged in developing a unique ESG rating system for properties. The scoring system is based on 15 parameters related to the Environmental, Social, and Governance components of ESG.
ESG (Environmental, Social, and Governance) innovations are transforming the real estate industry through smart buildings, water, energy, waste management systems, recycling facilities, development of sustainable materials in ConTech (construction technology), renewable energy transition, air quality monitoring, etc. These practices herald a new era of healthy buildings inhabited by happier residents. Due to the growing impacts of global warming and climate change, most industries including real estate are expected to adopt sustainable and eco-friendly practices. PropTech innovations using IoT, AI, VR/AR, and data analytics are increasingly deployed to track and monitor building operations in real time and make buildings compliant with ESG regulations. Experts estimate that the market value of ESG rating services in 2024 is over $ 10.37 billion. Growing at a CAGR of 8.25%, the market is expected to reach $ 15.42 billion in 2029.
In this latest podcast, Alaviya Rizvi, EIR, PropTechBuzz discusses solutions that not only facilitate businesses but also foster sustainable development, environmental stewardship, and universal community well-being with Srinivas Nag Srirangam, Founder, Prime Estate Global Solution Limited. Before entrepreneurship, Srinivas Nag Srirangam spent several years as a consultant in diverse industries. He has always had a strong passion for sustainability and technology. From a very young age, he has diligently worked to create solutions to solve real-life problems. His enterprise, Prime Estate Global Solution Limited integrates sustainability into real estate through cutting-edge technologies like data analytics and AI. Based in Dublin (Ireland), the company is planning to cater to Europe, the US, Middle-East countries, and India.
Srinivas Nag Srirangamās tryst with real estate began in 2013 with the Smart Cities project. Back then, real estate had not begun adopting technology at the scale we are witnessing today. Realizing this, Srinivas Nag Srirangam started researching and planning the potential applications of technology in the real estate sector. This was a period when he had begun realizing the grave threats to humanity posed by climate change. The idea that technology could solve the crisis gave him hope and inspired him to make headway in this field.
He founded Prime Estate Global Solution Limited with the vision of creating climate-related solutions. Beginning with smaller interventions like teaching sustainable construction technologies to masons and builders, Prime Estate Global Solution soon embarked on the ambitious project of ESG in real estate.
The key insight for the ESG initiative emerged from Srinivas Nag Srirangamās stays in rental properties. He realized that there was a huge gap between the landlord and tenant expectations regarding the property. Owners think that the rent for the property is justified in terms of the amenities provided but tenants always feel that it could have been better. This difference in their expectations leads to poorly managed properties. Such patterns can be found across the real estate sector. According to Srinivas Nag Srirangam, the key to driving successful climate initiatives is to understand the complex factors driving human emotions. If the landlord or the tenant were made to realize the benefits of improving the property, they would naturally take more responsibility towards the asset. Their initial plan was to create a points-based reward program or a loyalty program exclusively for tenants. But the criticality of climate change motivated the team to build something bigger and better. They retained the key insight of directly impacting property owners and residents as they were the key drivers of sustainable change but moved into developing a global ESG rating system exclusively for properties.
Globally, ESG (Environmental, Social, and Governance) is primarily managed at the top levels of decision-making whether in governments, corporations, or investors. However, the true impacts of sustainable practices can only be felt at the grassroots levels. Driving environmental sustainability needs the participation of millions of people daily. The best way to do this is by making information democratic.
Today, there are e-commerce companies that show you the carbon footprint of each product you buy. Why canāt we inform people about the sustainability of the assets they own or are about to rent? Knowing the history of energy efficiency, or the previous occupant satisfaction score can completely transform the journey of buying or renting a house. Towards this goal, Prime Estate Global Solution Limited has developed a 15-point score system for properties based on international standards. Similar to a global credit score assigned to individuals, the company has developed an ESG scoring system for properties
Srinivas Nag Srirangam wanted to create a language for sustainability that even a layperson could understand. The company used numbers to communicate important facts about a property. Additionally, the assignment of scores also makes the system more competitive which makes people constantly strive to improve their scores. The system integrates selected parameters used in ESG (Environmental, Social, and Governance) for measuring the sustainability of a property. For instance, the factors considered under āEnvironmentalā would include energy and water consumption levels, waste generation from each asset, recycling rates, GHG (greenhouse gases) emissions, etc.
To standardize the units, the system uses a scale based on āper meter square per yearā for each asset. The information collected is based on a number of KPIs. For instance, the percentage of electricity generated from renewable sources, the relative efficiency of heating/cooling systems, water input/output measurements, etc. Knowing these finer details can help landowners, tenants, or property managers exponentially improve sustainable practices in a building.
Under the āSocialā indicator, the first parameter used by the rating system is the occupant satisfaction score. Whether inhabited by the tenant or the landlord, knowing how happy an occupant is can give a realistic picture of the state of the property and the improvements that can be made. Another factor considered under āSocialā is health and safety incidents in a property. Safety-related incidents like a gas explosion or gas leak will be one of the indexes used to collect data that can impact the score of a property. The third index in the āSocialā is community diversity and inclusion. This is a key factor while judging a property because only a diverse and inclusive community can foster sustainable practices and ensure overall well-being of its residents.
The parameters under the āGovernanceā category are related to regulatory frameworks, compliance issues, and violations (if any). As discussed earlier, the foundation of the ESG rating system for properties is based on the idea of transparency and accountability. Accordingly, the āGovernanceā index adds transparency to property deals by ensuring every stakeholder is aware of the legal status of properties.
The information related to the āEnvironmentalā, āSocialā, and āGovernanceā categories creates the much-needed bridge between different stakeholders (like landlords and tenants) leading to a more collaborative approach towards sustainability.
Climate change is the most important challenge faced by humanity currently. One would expect that sustainability should come naturally to human beings. But what we see is that there are extremely low levels of environmental awareness among most people. This naturally leads to challenges in the adoption of sustainable solutions. This is one of the most important challenges faced by promoters of sustainable solutions across the world. However, with PropTech coming into the picture, we can gradually see technology leading revolutionary changes in this sector.
In a country like India where traditional brick-and-mortar homes were the norm, technology has paved the way for green buildings, smart homes, and the adoption of eco-friendly solutions like LED bulbs. Nowadays, buyers are demanding sustainable construction practices, renewable energy sources, water harvesting, green spaces, etc. that were unthinkable in the past.
It is commonly believed that technology is taking us away from nature, but according to Srinivas Nag Srirangam, it can help us appreciate holistic environments. For example, even in a hi-tech building, people expect green spaces. Prime Estate Global Solutions is leveraging available technologies to build its sustainability solutions. AWS (Amazon Web Services) provides cutting-edge tools to integrate blockchain networks. But the technology that surpasses everything else today is AI. AI has emerged as the most crucial tool for the Prime Estate team in recent times. Its capacity to collect, reference, and analyze information has quickened the pace of the project by months. With AI-led predictive analytics, the team is trying to assess the sustainability requirements of real estate and build a database of properties using blockchain. These initiatives are at their formative stages and Srinivas Nag Srirangam expects them to lead us into the future where information related to the sustainability of properties can be derived from anywhere in the world without the fear of a data breach.
The companyās immediate plan is to kickstart thought-provoking conversations on the issues of sustainability, ESG, and real estate through social media networks and webinars. Srinivas Nag Srirangam and his team at Prime Estate Global Solutions are also engaged in the research and development of ClimateTech solutions that can pave the way to a better future.
Worldwide, the demand for ESG solutions is growing in every industry. Real estate is one of the prime adopters of ESG innovations in the fields of energy and water management, ESG scores and certifications, eco-friendly materials, renewable energy, air quality monitoring, etc. These practices led by technologies like IoT, AI, VR/AR, and data analytics are making buildings greener and promoting healthy lifestyles among residents. Srinivas Nag Srirangam is a trailblazer in the field of climate-friendly PropTech innovations for real estate. His company Prime Estate Global Solutions is engaged in developing a unique ESG rating system for properties. The scoring system is based on 15 parameters related to the Environmental, Social, and Governance components of ESG. The company believes that information related to the sustainability of buildings will empower buyers and sellers to make more informed choices in the future and enable them to take good care of their properties. By facilitating the exchange of this information among laypersons, the company is trying to bring about a massive transformation at the grassroots level to fight against climate change.
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By Proptechbuzz
By Ravi Kumar
