French net zero regs keep property sector on its toes

Among the plethora of sustainability regulation that France has introduced is the Décret Tertiaire – or tertiary decree – a regulation which requires the reduction of energy consumption in the tertiary sector  – including offices, shops, admin buildings, and schools of over 1,000 sq m to make savings each year, aiming for a 60% reduction by 2050.

The regulation was launched in 2020 and came into force in 2021. Paris-based property company Paref Group is responding.

“After launching our ESG strategy we started working on our reporting side so we’re focusing on the CRREM alignment of buildings and green building certifications and making sure that all the buildings in our portfolio will be fit for future criteria,” said head of sustainability Öykü Kurtoglu.

“We don’t only focus on the ‘E’ but we also have ‘S’ and ‘G’ in the emphases in our portfolio. This incorporates things such as tenant engagement or air quality, green spaces. These topics are also super important for us,” she said.

The tertiary decree obliges companies to report their carbon emissions and energy consumption to the state. “So we are collecting the data for our tenants and sharing them with the state,” Kurtoglu explained.

France is also insisting on retrofitting where possible as opposed to new-building, she said. Demolition is the last option as far as municipalities are concerned.

“And whenever you do a retrofit, there are criteria in terms of energy reduction, in terms of carbon footprint, embodied carbon, that you need to respect,” Kurtoglu explained.

“In future we would like to go for taxonomy-aligned, net-zero aligned assets. We know that it’s not possible from today to align all these assets. It needs a huge transition in the industry so we are looking for opportunities to make brown buildings green or, if it is already green, make sure that it really fits the tenant’s criteria and all these regulations,” she said.