AY is investing in sensor technology as retrofitting efforts in the commercial real estate sector continue post-pandemic. (Courtesy, Avison Young)

As commercial real estate companies grapple with changing office environments and strategies for future occupancy, they’re turning to scalable, sustainable technologies to improve air quality and lower carbon footprints.

Increasing carbon tax bills and the impact of high commercial vacancy rates are putting pressure on large building owners, pension funds, REITs and their property managers to decarbonize their portfolios, too.

One of those companies is Avison Young (AY). The Toronto-based global commercial real estate company has over 400 million square feet under property management in 16 countries.

Through a series of technology investments, studies and analysis, AY is measuring companies’ return-to-office potential while improving energy efficiency to cut costs for operators. It’s also creating spaces for occupants and visitors, and encouraging green design.

“We’ve learned the value of holistic sustainability,” said Brandy Burdeniuk, director of ESG, North America. “We were building many bigger spaces that maybe weren’t being utilized the way we thought they were. We can’t build ourselves into sustainability; we need to be better at utilizing the assets that exist right now and how we build them out for future uses.”

As office environments change, so will organizations that need to scale up or down based on business purpose, culture, how people work and, ultimately, the role of the office, Burdeniuk added.

Investments could address high vacancy rates

The office market has been plagued by social distancing and work-from-home requirements, largely due to COVID-19.

As most employees were sent home to work, many offices were largely vacated. This is leading some companies to downsize their offices or forgo having an office at all and move full time to work from home.

Last September the national office vacancy rate hit 15.7 per cent, the highest level since 1994, according to a CBRE Group report.

With millions of square feet of direct and sublet space available, and more office space currently under construction in Canada’s main urban centres, large building operators are starting to respond in many ways.

“I look at the built environment from three lenses,” said Neil Lacheur, executive vice-president, principal, real estate management services at AY Canada. “There’s the more traditional capital like big machinery retrofits, whether a chiller or a boiler, to move you toward energy efficiency.

“The second element is pandemic-driven changes, and opportunities for equipment (has allowed us to) move towards designing hands-free environments, installing sensor technology and managing operations.

“And then, there are workplace changes.”

The research and analysis have allowed AY to gather intelligence about its waste policies, green cleaning programs and occupancy.

Avison Young Vitality Index for offices

Last year, AY launched The Vitality Index, a database that creates daily foot traffic estimates from participating office occupiers located in over 20 cities.

It also introduced a five-step ‘X Factor’ plan to gauge the current workplace situation and identify value generation opportunities. Measuring project mobilization, workplace research, key findings, conceptual design and technology assessments, the plan provides a roadmap to understanding business costs.

The ability to provide real-time data could be essential to establishing workplace value propositions for operators, Lacheur said.

“With using sensor technology, you get real-time data,” he said. “You can provide it to your occupants and constituents in real-time, so it gives people a sense of confidence to bring this point that they’re coming into a healthy environment that allows them to be more productive, and then frame their mindset to, ‘this is a good place to be’ as opposed to, ‘I’d rather be at home.’ ”

He added that companies can leverage this data to meet net-zero commitments or other sustainability goals as back-of-house energy and other initiatives come to the forefront.

What’s more, these climate-action steps can impact workplace productivity. A study from Harvard reported people who work in well-ventilated offices, with below-average indoor pollutants and carbon dioxide (CO2) levels, have significantly higher cognitive functioning scores.

Trickle-down effect in the private sector

All these issues have created alignment in the sector, as organizations aim to create sustainable environments in office spaces for employees and tenants.

Occupiers with 10-to-20-year leases have had to measure their staff expectations while creating spaces that allow for productive workplace environments.

As new office construction continues across the country, more workers will be needed to meet demands in the green building sector.

Akua Schatz, vice president, market engagement and advocacy at the Canada Green Building Council (CaGBC), told SustainableBiz the demand for these spaces could prompt new sustainable development. She said to meet our climate targets, employment in the sector must grow by a factor of three.

“Right now, we have 500,000 people employed in the green building sector, and that needs to triple to meet our climate change targets by 2030,” she said. “Our younger generations are increasingly motivated by their values, and they see climate change as a real threat.”

Changes to building codes could also further growth in the sector.

“These jobs, like working in the construction sector, can be a way to make a real tangible difference on climate change, which is a real way of appealing to a whole different subset of folks.”