Real Estate Industry's Readiness for Electric Vehicles

Integration of Charging Infrastructure as a Key Sustainability Strategy in Real Estate

As the charging infrastructure for electric vehicles (EVs) expands, the industrial real estate sector is poised to play a significant role. Landlords are increasingly incorporating charging infrastructure into their properties as part of their efforts to make their portfolios more sustainable.

For instance, Lendlease plans to install a minimum of 80 EV chargers in its properties, including popular shopping complexes in Australia. In the United States, Clarion Partners, an industrial developer, has already established over 348 chargers across its properties.

Renae Gasmier, Head of Sustainability Consulting - Australia at JLL, states, "Buildings are the future's green petrol stations and power stations."

The push for EV charging infrastructure aligns with the increasing adoption of EVs globally. EVs now account for 14% of new car purchases worldwide, with China leading the way at 28% in 2022. In contrast, Australia lags behind with only 4% of new car sales being EVs. New EV sales in the United States represented 7% of total sales as of January 2023, according to Inside EVs.

With the rise of electric cars, the real estate industry recognizes the importance of staying ahead of the curve. By investing in EV charging infrastructure, the industry not only meets the growing demand but also creates a new source of power-grid support, as the grid can draw or store power from EV batteries.

Moreover, providing car charging stations contributes to achieving sustainability targets for countries. Buildings labeled as "green" tend to attract higher occupancies, rents, tenant retention, and asset values, as indicated by a 2022 JLL survey of investors and occupiers.

In the journey toward net-zero emissions by 2050, industrial real estate occupiers and owner-occupiers are expected to play a crucial role. Many logistics and distribution companies are aiming to electrify their fleets, making industrial real estate infrastructure critical to supply chains and organizations' Scope 3 emission reductions. However, implementing EV charging infrastructure in industrial real estate requires careful consideration of factors such as power supply capacity, battery storage, availability of fast charging, load management systems, peak charging times, and power capacity.

Legislation and incentives are also driving the shift to electric. The European Parliament has passed a law banning the sale of new petrol and diesel cars in the European Union from 2035, while the U.S. government is investing significant funds in charging infrastructure and clean transportation. Australia has introduced its National Electric Vehicle Strategy, including a vehicle fuel efficiency standard and support for initiatives like battery recycling, infrastructure planning, and charging provisions in apartment building design. Government tenants in Australia are also stipulating EV charging in leases as they plan to transition their fleets to electric vehicles.

Gasmier emphasizes the need for organizations to evaluate emerging business models and technologies to fully leverage future value. Considering load management systems, peak charging times, and power capacity is crucial to avoid short-sightedness and ensure successful implementation of EV charging infrastructure.

The collective efforts of the real estate industry, government regulations, and incentives are driving the integration of EVs and charging infrastructure, aiming to create a more sustainable future for transportation and the built environment.