Three leading real estate and sustainability organizations are calling for governments, financial institutions and industry stakeholders to accelerate the decarbonization of Canada’s commercial buildings. 

REALPAC, the Canada Green Building Council (CAGBC), and the PLACE Centre at the Smart Prosperity Institute have released a new report, Decarbonizing Canada’s Commercial Buildings: The Owner & Investor Perspective, that outlines 10 actions designed to overcome critical barriers and speed up progress.

“This report provides a clear roadmap for aligning government incentives, leveraging innovative technologies, and driving market demand to achieve net-zero emissions at scale,” said Thomas Mueller, president and CEO of the CAGBC, in a news release.

The report highlights the economic potential of decarbonization, noting that the commercial real estate sector contributes $148 billion to Canada’s GDP and employs more than one million Canadians. Investments in clean energy and retrofits can create jobs, mitigate market risks, and position Canada as a global leader in the low-carbon economy, the report asserts.

REALPAC, the CAGBC, and the PLACE Centre urge all stakeholders to adopt its recommendations and build the partnerships needed to transform Canada’s commercial real estate sector into a global leader in sustainability and innovation.

The groups want to see immediate action from governments, utilities, and financial institutions to align policies and incentives with decarbonization goals. The report also stresses the importance of leveraging advanced technologies, driving market demand, and fostering collaboration across the real estate and financial sectors.

Since 2005, many new buildings that generate lower emissions have been added to Canada’s commercial real estate stock, says the report. However, for many of the approximately 550,000 buildings, decarbonization efforts are at risk of stalling, or have already stalled, for several reasons, the report says.

With commercial buildings contributing 18% of Canada’s greenhouse-gas emissions, REALPAC, the CAGBC, and the PLACE Centre say collaboration is needed urgently to meet the country’s ambitious climate goals. According to the report, decarbonization efforts future-proof assets, reduce operational costs, and drive innovation.

“Achieving meaningful progress will require bold action, including policy changes, investment in clean-energy infrastructure, and a shared commitment to a low-carbon future,” the groups said in the news release.

The report identifies six key barriers to decarbonizing commercial buildings: technology, capital, valuation, energy, people, and data standards. To address these challenges, the groups make 10 recommendations, including:

• Recognizing decarbonization investments in property valuations.
• Expanding access to long-term, low fixed-rate financing for retrofits and new developments.
• Providing building owners and investors with access to complete and standardized data.

These actions, the report argues, are essential to driving investment and aligning the commercial real estate sector with Canada’s low-carbon goals.

“The commercial real estate industry is ready to lead, but success will depend on strong partnerships across government, utilities, tenants, the appraisal community, financial institutions, and the private sector,” said Michael Brooks, CEO of REALPAC.

Investments in clean energy and retrofits can create jobs, mitigate market risks, and position Canada as a global leader in the low-carbon economy, the report asserts.

“Decarbonizing Canada’s buildings is not just an environmental imperative but an economic opportunity,” said Mike Moffatt, founding director of the PLACE Centre. “By addressing these barriers, we can create jobs, drive innovation, and position Canada as a leader in the future low-carbon economy.”

The report comes after a study led by Montreal-based Fonds immobilier de solidarité FTQ found that decarbonization of buildings will boost their long-term profitability. According to the Fonds study, the value of a sustainably designed building can increase by as much as 45% in the 10th year following construction.

Image: City of Vancouver