Green real estate development in China: State of art and prospect agenda—A review

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Abstract

Green real estate development is one of measures being implemented to reduce negative impacts of the building industry on the environment, society, and economy. However, there is lack of a systematic review of this large number of studies that is critical for the future endeavor. This paper reviews the existing body of knowledge related to green development. At first, the common research themes on green real estate development were identified, including concept, measure, business, and result. Then, the connotation and denotation of green real estate development was introduced in four dimensions. Third, the stakeholders of green real estate development and its benefits and costs were expatiated. Then, how to realize the green real estate development and its current weakness were analyzed in various aspects. It is found that the existing studies mainly focus on the environmental aspect of green building, other dimensions of sustainability of green building, especially the social sustainability is largely overlooked. Future research opportunities were identified such as the innovation of evaluation systems, integration of planning and design frameworks, management mechanisms and financing modes, and future proofing.

Introduction

The real estate and building industry has a significant impact on society in many aspects, including the environment and the economy [1]. It plays an important role in urbanization by providing buildings and facilities to satisfy human requirements and employment opportunities directly or indirectly in related industries [2]. In addition, the importance of the real estate and construction industry is related to both its size and its role in economic and social development [3]. Indeed, it makes a great contribution to national economic development. For instance, the construction industry contributed 6.86% to China’s GDP in 2013 [4]. The industry also consumes a large quantity of raw materials, social resources and human resources [5], with the construction of buildings, for example, one of its main products, consuming 40% of the stone, sand and gravel, 25% of the timber and 16% of the water in the world every year [6]. A great deal of Greenhouse Gas (GHG) is also produced in the process of construction—in the manufacture and transporting of building materials for example.

Many forms of resources (power, fuel, water, etc.) are also consumed in the post-occupancy phase. As Zhang et al. indicate the use of buildings account for approximately 38.5% of all U.S. carbon dioxide emissions, of which 21% and 17.5% are from non-commercial and commercial buildings, respectively [7]. The carbon emissions of buildings all over the world are forecasted to reach 42.4 billion tons by 2035, an increase of 43% on 2007 [8]. In short, buildings are one of the major sources of GHG and have an acknowledged important impact on climate change. Green buildings (GBs), on the other hand, aim to minimize their impact on the environment by promoting life cycle considerations during their planning and development process while enhancing the health of occupants and return on investment to developers and the local community [9]. Hence, GB is an inevitable choice to meet the need for environmental protection and sustainable development.

Dating back to 1960s, it was initially put forward as “Arology” in 1960s by Paolo Soleri, an architect combining ecology and architecture [10]. Since then, many developed countries (e.g., USA, Canada, Germany and France) have been working on the green building development. Generally speaking, they are in the frontiers for going green as they have designed a set of institutional norm and improved the green building evaluation standard (e.g., LEED) by relying on the industry and technology advantages.

For example, the EU approved the Energy Performance of Building Directive (EPBD) in 2002 to strengthen control over the total energy consumption of buildings. In 2007, EPBD adopted a regulation that forces building purchasers and tenants to provide energy performance certificates (EPCs) in the building sale or rental process [11]. In USA, buildings consume approximately 40% of all energy, 72% of all electricity and produce 39% of primary greenhouse gas emissions. In this context, the US Department of energy has put forward the Building Energy Efficiency & Technology Improvement Act which aims to define how to make it energy saving by technical details and promote the buildings labeled with “Energy Star” in a nation-wide scale. It is estimated that through all its partnership programs, US consumers will save nearly 50 billion kilowatt-hours of energy over the next 10 years, which translates to a net savings of $3 billion a year [12]. Also, the U.S. Green Building Council (USGBC) became one of the front runners when it launched the Leadership in Energy and Environmental Design (LEED) guidelines in 2000. Several other green building evaluation systems are in various stages of development in North Europe, UK (BREEAM) and Japan (CASBEE), and are enjoying different levels of market impact in their respective countries. In Japan, the CASBEE (Comprehensive Assessment System for Building Environmental Efficiency) was developed in Japan, beginning in 2001. The U.K. announced in December 2006 that it would realize its nearly-zero-energy building target on all new homes in the country by 2016 [13].

Comparing with these developing countries, the green building development in the developed countries is lagging behind as they usually face with challenges such as ‘lack of R&D development funds’, ‘outdated technologies’ and so on. In Asian countries, for example, according to a survey, an investment of about $ 50 billion a year by Asian Countries to achieve the target that the clean energy accounting for 20% of total energy supply by 2020 [14]. At the same time, the investment about $ 10 billion each year needs to be input in order to achieve the 2015 target (80 gigawatts as the new energy generation capacity) in developing countries. Hence, the lack of funds becomes a major obstacle for developing countries in the development of new green building technologies. The R&D on low-carbon technologies requires a lot of financial support, and this is a huge amount of money for developing countries.

Over the years, many developing countries, especially low-income developing countries, have invested the majority of its revenue in the infrastructure construction and labor-intensive industries, which leads to a relatively small investment in green technology R&D. Also, the education is relatively underdeveloped which further lead to the lack of R&D experts. In this context, the developing countries introduced many high cost low-carbon technologies from those developed countries. However, the introduced R&D could not be fully undertaken due to a serious lack of research capacity in most of the developing countries. China is one of the examples.

Green real estate development, strongly advocated by government in China, is a new form of development combining ecology concept with real estate. Due to the double pressures of environmental protection and economic growth, green real estate development is now considered a necessary form of contemporary development, in particular, for real estate industry. Green building (GB) is the main product of the green property concept, but green property is not solely concerned with superimposed technologies and their associated costs [15], [10]. While GB is mainly focused on building design and methods of construction, green real estate development also encompasses sustainable landscape design, innovative GB materials, building operation and maintenance [16]. Compared with GB, the concept of green real estate development covers a wider range of activities, involving land sites’ planning, project planning, materials and technology design, construction, operation, maintenance, demolition, etc. Although it is a relatively new concept, green real estate development has been well known as a thrilling new way to make property healthy and energy-efficient, with better indoor air quality, lighting and temperature controls. It particularly emphasizes all the links between green processes in the whole building life cycle. Green real estate development involves complicated system engineering that aims to achieve a social, economic and environmental win–win situation. Important new evidence from recent literatures implies that green building (GB) has been used as the ‘keyword’ in the search engine of ‘web of knowledge’, ‘science direct’ and ‘google scholar’ for more than 3156 times while the concept of ‘green real estate development’ has been used or cited as less than 436 times. Table 1 summarizes these differences between GB and green real estate development.

However, despite extensive studies on various aspects of GBs in different contexts, there has been little substantive research to distinguish between the GB and green real estate development concepts, uniform ideas have not yet been formed, and the boundaries between them are often blurred. Therefore, the aim of this paper is to critically review the studies relating to green real estate development to chart and summarize the existing body of knowledge and future research needs. The paper therefore provides a useful reference for researchers and industry practitioners interested in the development of green real estate projects.

Section snippets

Common research themes

The green real estate development concept is beginning to take hold in the construction industry due to environmental conditions becoming more and more serious. It has been the subject of extensive research, and with a rapid growth in the number of published papers in recent years. Reviewing these papers reveals four common focus questions with escalating implications for the green real estate development process and product (Fig. 1), concept (what is green property?), measure (how to create

What is green real estate development?

Creating green real estate development involves greening in the whole process of development and management, including every component or aspect in the real estate development life cycle. Green marketing and brand and design commence at the earliest stage of the real estate project, with green development being fully integrated into the whole process [53]. Appropriate technologies and strategies are chosen in each stage according to the specific circumstances of green property positioning,

Green real estate developed for whom?

There are various stakeholders involved in the green real estate development process [93], [94], [95]. Although these stakeholders, and their interrelationships vary over the project life cycle [96], their leadership, acceptance of responsibility and coordination of the various interests involved play a crucial role [97]. Stakeholder analysis provides a useful tool in helping accommodate specific user, regulatory, or community needs to mitigate the risks involved, in what is regarded as the

Benefits and costs of green real estate development

Although the green real estate development concept has not spread as quickly as expected, it is nevertheless attracting increasing attention worldwide. This is particularly the case with GB benefit-cost analysis, which provides an important means of promoting building energy conservation and emission reduction in reflecting GB efficiency in either policies or project investment levels and providing important economic information to the market.

The main financial benefits of GB are in significant

How to realize the green real estate development concept?

There are many barriers to realizing the green real estate development concept, such as the limited knowledge and expertise in GB methods, poor quality designs, inadequate GB regulations and non-compliance with existing regulations, failure to recognize the need for social regeneration and limited resources, and lack of a shared vision of sustainable development [124]. These factors can generally be divided into three interdependent technological, managerial and behavioral/cultural categories

Current weaknesses in green real estate development

Current green technologies have yet to be perfected and various problems have arisen to date in their adoption. Some notable examples are shown below:

  • Although the overwhelming benefits of green property are associated with thermal comfort [153], one analysis of the energy consumption of 100 LEED certified buildings found that approximately 30% consume more energy than conventional buildings [154]. On one hand, possible solutions for addressing the problems may lie in the improved green building

Conclusion

This paper provides a critical review of existing studies worldwide relating to green real estate development in terms of definition and scope; stakeholders; costs and benefits; and the means by which it can be advanced. This highlights that the most green real estate development studies focus on policy, technologies, materials, costs and benefits, and implementation strategies. The main benefits are seen as in helping to create a sustainable society and environment, with related green

Acknowledgements

This research is funded by the National Natural Science Fund (Project no: 71303203) and is also partly supported by the Matching fund for Mainland NSFC project by City University of Hong Kong (Project no. 9680114). The work described in this paper was substantially supported by the grant from the College of Liberal Arts and Social Sciences, City University of Hong Kong (Project no. 9610282); the teaching start-up grant from City University of Hong Kong (Project no. 6000504), the start-up grant

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