Green Gains: Unlocking Commercial Real Estate Value Through Sustainability in China
Cushman & Wakefield's latest report explores how sustainability is reshaping the commercial real estate sector in China, offering insights into ESG drivers, policy frameworks, and market trends.
SustainabilityCommercial Real EstateEsgChinaGreen FinanceReal EstateNov 10, 2025
Market Demand for Sustainable Commercial Real Estate Buildings
In the commercial real estate sector, sustainability involves the integration of environmental, social, and governance (ESG) principles throughout a building's lifecycle—from design and construction to operation and eventual redevelopment. This includes energy efficiency, resource conservation, occupant well-being, ethical governance, and resilience to climate risks. The demand for sustainable commercial real estate in China is steadily increasing, driven by regulatory, investor, and occupier pressures. While the market is still maturing, sustainable assets are increasingly recognized as sources of long-term value, risk mitigation, and competitive differentiation.
Sustainability Factors Impacting Real Estate Performance
The integration of sustainability into CRE is no longer a niche or optional undertaking; it is a fundamental driver of asset performance. As ESG expectations from investors, regulators, and occupiers continue to evolve, sustainability factors are becoming decisive in shaping market competitiveness and long-term value creation. In China, national policies, urban planning priorities, and the rise of domestic green finance are accelerating the shift toward sustainable buildings. Despite challenges such as retrofit costs, data transparency, and regulatory inconsistencies, market leaders are overcoming these barriers through targeted strategies, PropTech solutions, and stakeholder engagement. Real estate stakeholders who embed ESG into their core operations and investment decisions will be best positioned to unlock long-term value, attract responsible capital, and remain resilient in an evolving market landscape.
Future Outlook
The landscape of sustainable real estate is evolving rapidly, driven by regulatory mandates, investor demands, technological advancements, and climate commitments. A growing number of governments, cities, and corporations have pledged to achieve net-zero emissions, setting a new benchmark for the real estate industry. This shift is reshaping both new development and asset management strategies. AI, data analytics, and digital twins will play a transformative role in enabling smarter, faster, and more accurate sustainability decisions. Investors are increasingly using GRESB scores not only as benchmarks but also as tools for risk pricing and capital allocation. This evolution will require market participants to adopt a more integrated, forward-looking approach to ESG management, where sustainability is embedded into strategy, culture, and financial planning.
Alton Wong, Head of Sustainability Advisory Services, Head of Advisory Services, Valuation and Advisory Services, Greater China, said, “Sustainability has become an inevitable trend in the development of commercial real estate on the Chinese mainland. By integrating the concept of sustainability throughout the entire lifecycle of commercial buildings, these projects can achieve coordinated development in the economic, social, and environmental spheres, unlocking vast potential for green returns. In future market competition, the commercial buildings that actively embrace sustainability and continuously innovate in green practices will stand out and become leaders and beneficiaries in the industry’s advancement.”
Shaun Brodie, Head of Research Content, Greater China, added, “Sustainability has brought a good number of opportunities to the commercial real estate sector. Projects that embrace sustainability can reduce operational costs and enhance energy utilization efficiency, thereby expanding profit margins. An increasing number of investors are taking sustainability as a crucial consideration factor in their investment decisions. Meanwhile, real estate enterprises that integrate ESG principles into their core operations and investment decisions can also establish a favorable corporate image, bolster their market competitiveness, and lay a solid foundation for their long-term and stable development.”
Frequently Asked Questions
What is the main focus of Cushman & Wakefield's 'Green Gains' report?
The report focuses on how sustainability influences operational performance, asset value, and investment decisions within the commercial real estate sector in China.
What are the key ESG principles in commercial real estate?
The key ESG principles include environmental (energy efficiency, resource conservation), social (occupant well-being), and governance (ethical practices, compliance).
Why is there a rising demand for sustainable commercial real estate in China?
The demand is driven by regulatory pressures, investor expectations, and occupier preferences for sustainable and resilient buildings.
What are the challenges in integrating sustainability into commercial real estate?
Challenges include high retrofit costs, data transparency issues, and regulatory inconsistencies.
How will technology impact the future of sustainable real estate?
AI, data analytics, and digital twins will play a transformative role in enabling smarter, faster, and more accurate sustainability decisions in the real estate sector.
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