Sustainable Building Lifecycle Management

Sustainable Development Goals (Applied to Real Estate)

As a sector responsible for 40% of primary energy use and a third of anthropogenic CO2 emissions, the real estate industry has a clear role in helping the world achieve specific global goals. Due to the real estate industry’s primary role in asset management and its vulnerability to climate change, it should be a leading advocate of environmental stewardship in this sector. An integrated framework for solving the most pressing global sustainability concerns is provided by the 17 SDGs of the 2030 Agenda, which all stakeholders must work together to achieve together. Sustainable development resolves current issues without jeopardizing future generations’ capacity to solve similar issues.

There is a common understanding of the concepts of sustainability included in the definition, although there has been considerable level-headed dispute over its relevance. Thus, sustainability is generally thought of as having three broad components such as environmental, financial, and social sustainability (TBL). People (social), natural (environment), and benefit (finance) all fall under the umbrella of these three components (monetary). Various producers have taken the WCED definition of maintainable development and the concepts it brings to bear on urban redevelopment. They have developed their own contextualized definition of practical development and the TBL’s components from that point forward.

Social Dimensions

Living Together

When it comes to the real estate and construction industry’s long-term viability, factors like greenhouse gas emissions, end-of-life generation of waste and disposal, corruption in planning and real estate and construction, housing quality (a major determinant of life quality), and the absence of human and labor rights safeguards are involved. The social dimensions of sustainability are largely influenced by demographic issues, which directly and indirectly affect the economy and the environment. Sustainable building is becoming more relevant as the population continues to expand.

Comfort and Health

A country’s entire competitiveness hinges on the health of its real estate market. A wide range of industries is involved in the real estate industry, including raw materials, financial systems, construction, and engineering. In the commercial real estate market, asset and space markets are two of the most important components. Real property is the right to use space or the physical property itself, such as a plot of land or an apartment building in the space or use market. However, the asset market is similar to the capital market in that it focuses on property ownership.

Economic Dimensions

Sustainable Investments

The Triple Bottom Line concept’s economic sustainability objectives include ecologically viable restrictions, a high quality of life, and a positive connection with stakeholders. Ethical investors may increase their profitability by reducing their total costs and price risk. Among the elements that lead to reducing construction systematic risk is the optimal usage of buildable land and cutting-edge technologies.

Operating and Maintenance Cost Optimization

The commercial real estate sector reaps more than cost savings from the rise in the market value of sustainability of real estate investments, as seen by the appreciation in the prices of these properties. A green premium is a cost reflected in increased rental and selling prices due to monetary attempts undertaken by investors and customers to lessen the environmental effect of real estate development and residential improved energy efficiency. Customers demand that green features should be included in their leases due to sustainable construction’s monetary, healthcare, and efficiency benefits. When it comes to the economics of the “triple bottom line” idea, a firm can only be called sustainable if it positively impacts the environment in which it operates and grows.

Environment Dimensions

Building Materials

The real estate industry, which relies heavily on non-renewable energy resources and energy-consuming items and thus impacts the generation of waste material and other negative externalities, can be held responsible for environmental degradation. If current trends continue, the world’s major cities will need millions of new homes and several million square feet of new office space by 2029. Because of climate change, the environmental component of sustainable building has grown from specialization to an approach that developers of sustainable property investment embrace throughout the design, construction, use, and even demolition of facilities.

Operating Energy

According to research on climate change mitigation programs, construction offers much potentials to save energy and reduce carbon emissions. Carbonization of energy production may minimize air pollution by moving to other or remodelled residences that consume less energy or create more energy than they require. The construction industry’s global green trend is intensifying. Building assessment systems based on sustainability features are increasing throughout the globe. There is a rise in demand for building energy efficiency certifications, all in keeping with this statement. Despite this, energy efficiency is still a major consideration in sustainable construction.

Building Life Cycle

Each step of a building’s life cycle involves using natural resources, energy, and water effectively. As an illustration, energy is required for the following steps in the construction process: i) the extraction of raw materials; ii) the processing and manufacturing of raw materials to produce usable construction materials or components; iii) the assembly of material construction components; iv) the maintenance of the building (for example, the use of energy for cooking and lighting); and v) the demolition of the building. Buildings significantly influence the environment because of the many and generally lengthy phases of their life cycle, including the production of greenhouse gases and the generation of pollutants. Each step of a building’s life cycle consumes natural resources, energy, and water, resulting in the production of greenhouse gas emissions and other pollutants. When it comes to Life Cycle Assessment, buildings are a typical case study since they use many resources throughout their life cycle’s construction and operating stages.

Product Stage

A structure’s life cycle begins with the extraction of its raw materials. Iron ore, limestone, bauxite, copper, lumber, and petroleum are examples of the earth’s natural raw resources. These raw materials are transformed into essential building materials like steel, cement, aluminium, and plastic with modern technology. Resources like water, energy, and fuel are used and disposed of due to exploiting non-renewable resources from the earth’s surface. Resources will run out unless new ways are developed to suit the needs. Natural resources are degraded when more people and monetary goals populate the planet.

Mining needs fossil fuels to power and transport equipment and machinery and raw materials to processing or utilization facilities. One of the most significant contributors to greenhouse gas emissions and other pollutants is the usage of fossil fuels. For example, mining has resulted in acid rain, which has a long-term effect on the ecology hence the land is devalued by mining. The surrounding ecology, particularly water supplies, is polluted by abnormally high concentrations of chemicals and minerals. Many miners utilize chemicals to separate precious ores from waste elements that may remain in tailings for years. The destruction of vast swaths of land for open-cut or forest-cutting mining may lead to erosion and biodiversity loss.

Construction Process Stage

Construction is the process of assembling components or materials to create a finished product, such as a building. The building is synonymous with civil engineering, and it serves as the foundation for new advancements aimed at improving the quality of life for the general public. A structure’s design must consider the practicality of building even if construction requires a substantial amount of talent. During the construction phase of structures, especially multi-story buildings, many materials are used. The built environment is the result of building in its widest meaning.

Use Stage

Because some structures have a lifespan of more than 50 years, the operational stage of a building is likely to be the longest. Electricity and telecommunications networks and other equipment need water and energy. Almost often, the energy required comes from the burning of fossil fuels. As a key source of indigenous energy, coal generates most of South Africa’s electricity and a considerable amount of its liquid fuels. As well as conventional fossil fuels like crude oil and natural gas, there is a slew of innovative and recycled options for primary energy production. Buildings need vital utilities to function properly, such as water and waste disposal pipes. Construction, operation, and deconstruction of buildings account for 15 percent of freshwater consumption, 40 percent of energy use, and 23-40 percent of global greenhouse gas emissions worldwide. In addition, roughly 25-40 percent of the world’s ultimate energy consumption is accounted for by the functioning of buildings alone. When a building is in operation, it might have the same environmental effect throughout its lifetime as when it was built.

End of Life Stage

It is the fifth stage of a building’s lifetime and entails the destruction of a structure as well as the dismantling of its components in order to completely demolish it. Buildings, like all other items, have a shelf life that must be replenished. Aside from that, structures must be demolished to make room for newer, more functional structures that meet the present needs and expectations of the relevant users. Building demolition creates large volumes of solid waste, which must be disposed of when the demolition is completed.

For example, garbage is either incinerated, causing enormous emissions of greenhouse gases that impair air quality, recycled, or thrown in landfills, becoming outdated. Other environmental implications of demolition include the discharge of greenhouse gases from the demolition machines and the transfer of debris to landfills or items to recycling facilities. Leaching from discarded materials may lead to eutrophication of the surrounding ecosystem. Decomposing organic materials like wood may emit CO2 and CH4 (methane) into the soil and environment.

Management of sustainability Through a Building Life Cycle

Corporate Policy

Corporate sustainability principles and policies that the business expects its workers to meet in set operations and maintenance performance goals are critical. The senior manager oversees creating a company-wide sustainable development policy and setting specific objectives. More than that, the environment is included in sustainable development. It addresses social issues such as poverty reduction and equitable distribution of wealth. It considers macroeconomic indicators that could be overlooked from an overly environmental perspective. It highlights the importance of preserving and improving the world’s largest financial resources and the disadvantages of society’s opportunity to replace capital assets with artificial capital. Nonetheless, establishing a company’s policies on environmental responsibility is an important first step in addressing the larger issue.

There are various advantages to actively involve the executive board in the development of a business policy for sustainable growth and development. The executive board sets the tone for the organization’s management and personnel by outlining broad goals. The devotion of the board of directors will not be enough to guarantee that a business policy on sustainable development is executed appropriately. However, without that kind of commitment, putting the project in place would be difficult. In addition to making general announcements about sustainable development policies that are important, top directors and management should supplement such remarks with more specific objectives.

Corporate policies for long-term sustainability must be evident, simple, and, if possible quantifiable. Management and others must create measurable objectives if they would like to evaluate whether their decisions have achieved the stated goals. Top management will need to figure out what level of aggregation is appropriate. Setting measurable waste minimization performance expectations across all work locations could be one goal. More business strategy targets for every site – 1 would be set up to help achieve this goal.

The Strategy

The company must adopt a plan that outlines how something intends to position itself compared to the competitors and stakeholders’ desires as a whole plan is required to clarify when and where the company’s management expects to accomplish that goal, as well as the timelines for achieving it. Various big that will be encountered along the way. Senior management needs to consider and approve the plan and strategy before submitting them to the management board. Because sustainability is so pervasive, it’s critical that top executives (who reflect all elements of the business operations) ‘buy throughout’ to the initiative. Any deviation from complete devotion could result in the plan’s failure.

The company must devise a strategy that explains how it aims to position itself compared to competitors and stakeholders’ expectations. An overall plan is required to detail how and when company management anticipates achieving that goal and the various major obstacles encountered. Senior management must consider and approve before submitting the plan and strategy to the management committee for final approval. Because sustainable development is so pervasive, top executives (who represent all aspects of business operations) must ‘buy in’ to the initiative. Any deviation from the plan’s strict adherence could lead to its failure.

After the plan and basic unit have already been approved, specific plans detailing how well the new approach will operations departments, management solutions, information management, and trying to report should be produced. These should include measurable goals for each area and details on how accomplishment will be measured. They should pecify how much money would be spent and how much training will be provided. As input would be gathered from various sources, it will be a moment and evolving process with frequent changes. Ideally, senior administration and the board of directors should endorse the plans once they’ve been finished. Smaller firms will face unique challenges in executing a sustainable development philosophy, but they may achieve their goals with creativity, determination, and collaboration.


The United Nations proposes a multi-disciplinary approach to achieving a decent future in the construction sector in 2021, which incorporates elements such as conserving energy, better material use, material reduction waste, emissions, control of pollution, etc. There are various methods for controlling and improving the current nature of construction works to make them less environmentally harmful while sustaining the good camera of construction projects. The complete building should be the background in which those activities are implemented to achieve a competitive edge through eco-friendly construction techniques. According to a literature review, three general aims should form the framework for implementing sustainable construction and building while keeping in mind the previously described principles of sustainability challenges (social, environmental, and economic).

Resource Conservation

Resource environmental protection refers to accomplishing more with fewer resources. It is the management and regulation of living things’ use of nature to maximize current generation benefits while maintaining the capacity to meet future generations’ needs. The concept has become a popular issue in long-term development discussions. According to Tsolakis (2021), specific resources are increasingly scarce, and the use of residual inventories must be handled carefully. In rare materials, the author proposed using lesser renewable materials. Bold declarations about the need for substantial materials and energy resources changes have received attention in policy circles.

According to the premise, productivity growth is forced to minimize the effects on natural systems. According to Satar (2019), the construction industry consumes significant resources; so many proposals are intended to create environmentally friendly buildings. He went on to say that the methods for locating these efficiencies are varied. He used passive solar design principles to reduce non-renewable consumption of resources, power generation, product lifecycle design, and building design as examples. Methods for lowering material waste during building construction and creating options for building material recovery and recycling help improve resource efficiency. Concerns about the depletion of non-renewable natural resources have led to calls for greater resource efficiency. Because power, water, material, and soil are non-renewable resources vital to construction projects, conserving them is essential.

Energy Conservation

Energy consumption is one of the most severe environmental challenges facing the world today, and it is unavoidable in every civilization that wishes to operate properly. Buildings are, without a doubt, the major users of energy. Natural resources and energy are used extensively throughout the building process, from layout to operation to deconstruction. Throughout the life cycle of building materials, from the production process to the management of the construction materials after they have reached the end of their useful life, the type and quantity of energy employed may have an impact on the flow of greenhouse gas emissions.

Increased efficiency can significantly reduce their use and limit non-renewable energy supply exhaustion. As a result of this revelation, the construction industry has paid more attention to energy conservation in recent years, partly since the sector has a large potential for immediate power savings and emission control, both of which are harmful to the environment.

Power consumption would include both embodied and efficient energy use in the life cycle. The energy required to keep a building’s atmosphere stable can be considered the building’s function adequately requirements (Yang et al., 2018). Energy, gas, and fossil fuel combustion like coal and oil will be included.

Roles and Objectives of the Stakeholders

Stakeholder analysis is necessary to identify all groups affected by the company’s operations, whether directly or indirectly. It identifies stakeholders’ issues, concerns, and knowledge needs regarding the organization’s efforts to achieve environmental sustainability. A company’s existence is inextricably linked to the global environment and the society where it is based. The activities of a company must be conducted safely and securely. Human rights must be respected, and a dedication to a culture protecting the worldwide environment must be made. Corporation strategies at the beginning of the century were primarily focused on

For investors and shareholders, maximizing the return on the investment is critical. Businesses were not required to meet any other environmental or social goals. In many industries, exploitation of natural and human resources was the norm, as was a lack of regard for the well of the people with whom the company did business. Businesses in industrialized countries operate in a more complicated and regulated environment in today’s world. A slew of rules and regulations govern their actions, and their managers are held accountable to a wider set of stakeholders. Subsequent generations and natural resources are added to the stakeholders in sustainable development.


Identification of parties with a personal stake in a company’s organization, which translates to improved corporate governance, is an important aspect of the principle of sustainable development. One of the main differences between autonomous and traditional management techniques is developing a reputable organization to conduct stakeholder analysis. The recognition of the different groups impacted by the company’s operation is the first step in the stakeholder analysis. Stockholders, lending organizations, regulatory agencies, employees, consumers, suppliers, and the company’s culture are all stakeholders. People who are impacted or believe they are affected by the company’s impact on biodiversity, and social capital, must be included.

Return on Investment in Sustainability

Life Cycle Costing

This analysis treats the capital investment as part of an initial cost and the operating costs as on-going follow-up costs. The assessment of economic advantages is usually associated with the economic dimension of sustainability (Dell’Anna et al., 2021). The qualitative aspects and financial effects are highly considered from an economic perspective to enhance building sustainability. The concept of sustainability states that reducing the investment cost in the conservation and transformation of the existing real estate buildings results in optimizing social and technical infrastructure expenditure.

Recently the sustainability concept has left behind adequate resources for future generations to have a building quality. In the building industry, water and energy standards for sustainability must provide excellence in designs (Ottman, 2017). This includes the creation of passive cooling, heating, and lighting systems. Most construction operations use much energy which helps in carrying operations forward with the intent of the design, renovating, and maintaining the performance of systems in the sustainability model.

The methods for life cycle costing and their evaluation of the economic deficiency have always been part of the foundation for appropriate decisions made in investments and certification of buildings. Thus, it’s important to effectively demonstrate the economic profitability of building investments to acquire the capital for investment (Rajagopalan et al., 2021). To improve the cost-effectiveness of building, it’s good to invest in long-term performance and system designs. Coming up with renovated and new buildings with operating and maintenance costs highly result in significant savings in the real estate.

Factors of Influence

Building and construction business over a long time, has greatly faced many challenges by their strategic financial analysts. Financial analysts in place have highly contributed to the downfall of the building companies whereby they have failed to be productive due to the high and rapid evolving competition present in the investment in sustainability. For these building companies to adequately counter the impact of the acquisition on the corporate financial results, a range of research was carried out to determine the existing problem of building and construction companies. Increasing international developments greatly influenced the building firms after increasing the number of foreign investors.

The real estate economy grew rapidly, increasing pressure on the collaborative structures in the early 1960s. The dividend policies were relevant to the building firm’s value under the stringent –efficient market consumption. The research study fully analyzed the determinants of dividend policies that existed in real estate companies. There existed three distinct regimes of dividend policies in the construction economic policy. The estimated models used the regimes towards assessing the determinants of the life cycle costing policy with the values of effects of each dividend.

Evidence of the Financial Impact of Sustainability

Long Term Value

The major objective of the dividends policies in the Life cycle costing was that it served as a source of income for many of the shareholders in the real estate. Investors who had invested in these building companies would use the dividends for consumption and serve as a reminder for reinvestment in other assets; due to weak disclosure practices, investors used dividends as tangible evidence of the real estate firms’ performances (Stephan et al., 2020). After the dividend’s pay out, the managers’ cash constraints were forced to approach the capital market towards additional funding. This displaying role resulted in a free cash flow, which positively affected dividends as construction firms experienced high returns on the financial markets.

Real estate has ever set more of its asset sales and cost-cutting as the companies adjusted to prolonged low prices towards saving on energy. The company’s management team explains that by capping its capital spending by investing in exciting construction projects, driving down the companies’ costs, and selling non-core positions. The building and construction companies added that it was up to forging onwards with $ 30bn of the asset selling prices within a specified time duration.

Most investors use stock repurchase investment sustainability policies as their safety measures. These policies tend to boast a company’s selling price within a short period, as the firm’s buying reduces the company’s outstanding shares and bids increase in the building market. The effects of the stock repurchase in real estate and returns were mainly set to reduce the existing number of a building company’s shares in the real estate market; as a result, there is an increase in the ownership stake of these companies’ stakeholders. Most construction firms are up to repurchase shares mainly because they believe the market has discounted its shares towards investing in itself and improving its financial ratios.

Energy prices are rated in renewable and recycled sources; energy efficiency measures that look less attractive in a building are always modelled differently. The energy principle usually applies when renewable sources like wind and solar are present for use. Over a long time, many materials have been recycled, thus reducing the power costs in construction; among the problems associated with increased energy prices are recycled materials. The future of sustainable investment in a building usually involves trying to balance extra, financial considerations long, term, and short-term goals.

Selling Price

The selling price in the life cycle costing is a comprehensive procedure for evaluating the cost-effectiveness of other project designs and evaluations. This usually includes the costs of construction, building maintenances, and design decisions; most of the infinite number of alternatives in a building are usually captured as a cost-benefit (Fathollahi et al., 2021). Analysis of building alternatives must consider the effects of return on investment diminishing returns. The associated effects of the selling price affect the calculation for each building measure individually and the set measures in combination.

Life Cycle Costs Reduction

Life cycle cost analysis in a building is a process whereby the total sum of construction costs associated with maintenance is always concerned with the cost of building ownership considering the incurred costs. Building ownership’s long-term expenses always outweigh the purchase price, and these costs might vary widely depending on the alternative options. The asset management method relies on installation and operation as input to evaluate potential alternatives. Using life cycle costing to reduce the fixed costs of the end goods of enterprises is, therefore, a preferred strategy.


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