In the Colombian real estate market, sustainable buildings have successfully established themselves due to ecological and financial benefits that traditional constructions struggle to match. With a higher initial investment, the question arises: which of these two options represents a better long-term investment? Let’s analyze the figures and trends shaping the future of sustainable construction in Colombia.
Certified Buildings: A Boom in Colombia
Sustainable buildings are classified according to certification systems such as LEED, EDGE, and WELL. These systems focus on reducing carbon emissions, improving resource consumption efficiency, and promoting the health of both residents and the environment within the asset. Environmental certifications have become the primary objective of new real estate projects, driving significant environmental and social challenges in the industry.
An analysis conducted by MTS Consulting + Management reveals a significant increase in the number of LEED certifications granted by the U.S. Green Building Council (USGBC), underscoring the importance of having environmentally and socially responsible environments that promote health and well-being, improving both the quality of life and the state of the planet. This has taken on a crucial role in the real estate industry. Brazil leads the region with 626 certificates issued in the last 8 years, followed by Mexico with 512. Colombia ranks third with 216, followed by Chile with 191, Panama with 172, Argentina with 133, Costa Rica with 125, Peru with 114, and Uruguay with 9. Meanwhile, the United States boasts 41,317 certifications. This trend confirms the growing interest in sustainability both in the region and the country.
“LEED certifications have driven the rental value per square meter of corporate buildings above the average. In Colombia, these properties have an average value of $18 USD (COP$73,300) per square meter, 6.6% above the city average; in Costa Rica, they stand at $21.40 USD, in Panama at $19.37. It’s worth mentioning that these values can vary depending on the certification category and the project’s characteristics and location,” says Ana María Mejía, LATAM Consulting and Market Intelligence Manager MTS.
The Challenge of Initial Investment
While sustainable buildings offer long-term economic benefits, their construction requires a higher initial investment compared to non-certified structures. In the United States, this generally results in increases ranging from 7.4% to 9.4%, in Costa Rica between 7.5% and 8.9%, Panama between 7.1% and 8.9%, and in Colombia between 5.3% and 9.3%.
Sustainable buildings stand out for their profitability. Rental and sale prices in these certified buildings also surpass those without certification. For instance, in Costa Rica, the average rental price per square meter is 17% higher, closely followed by Panama with 13.7%, and Colombia with 8.6%. The United States also aligns with this trend with an 11% higher per square foot rental price for a non-LEED certified building.
Regarding the average sale price per square meter, Panama takes the lead with a percentage between 11% and 15% higher than non-certified buildings. Colombia remains competitive with a range of 10% to 15%, while Costa Rica is around 11%, and the United States sees a significant increase of 21.4% per square foot.
According to Ana María Mejía, “One of the most important aspects for any investor is the occupancy rate. As such a significant investment, it requires that its areas be occupied as soon as possible. In this case, Colombia has the highest occupancy rate, averaging 99%, followed by the United States with rates between 90% and 92%, then Panama with an average of 86%, and finally, Costa Rica with 75%.”
The rise of sustainable buildings is largely due to their commitment to sustainability and energy efficiency. With a lifespan that can be up to three times longer than conventional buildings, sustainable buildings in Colombia contribute to climate change mitigation and resource conservation.
The trend towards a sustainable future
Sustainable buildings are transforming the landscape of the Colombian real estate market and the region. Despite the initial investment required, the figures reveal that the combination of profitability and a positive environmental impact make these buildings an attractive and necessary option for building a sustainable future.
According to Andrea Cáceres, Commercial and Latam Expansion Director of MTS: “Sustainable buildings are here to stay in the Colombian real estate market. Although they represent a higher initial investment, their environmental impact, energy efficiency and long-term economic benefits make these buildings a valuable investment for the future of the country. The commitment to sustainability is consolidated as a priority for industry players and an opportunity to build a more resilient and environmentally responsible country.”
