Why there is Rising Demand for Green Properties?

The belief that green properties bring multiple benefits for both residents and developers is becoming universal. The real estate buyers are realizing the integral role played by the green buildings in minimizing carbon emissions and contributing toward one of the biggest global agendas – Climate Change. Across the UAE, some landlords are evaluating the cost and the benefits of making their portfolios greener to meet the expectations of the property buyers as well as the tenants who are becoming more environment-friendly.  

Rising international focus on climate change, Conference of the Parties (COP26) summit and UAE’s net-zero initiative to minimize emissions and pledging to invest almost $165 billion in clean energy by 2050 are the other major reasons for the landlords to construct green buildings.

Covid-19 has created an urge for employee safety to ensure they feel comfortable coming to the office. To take employee safety to the next level, corporations are choosing green properties to prioritize employees’ well-being and adapt to their occupational strategies and achieve their sustainability goals.

What is a Green Building?

The World Green Building Council (WGBC) defines a green building as – “a building that, in its design, construction or operation, reduces or eliminates negative impacts, and can create positive impacts, on our climate and natural environment.”

Some of the features suggested by WGBC which make a building green include –  

  • Efficient use of energy, water, and other resources
  • Use of renewable energy, such as – solar energy, pollution, and waste reduction measures, and the enabling of re-use and recycling
  • Good indoor environmental air quality
  • Use of materials that are non-toxic, ethical, and sustainable
  • Consideration of the environment in the design
  • Construction, and operation
  • Consideration of the quality of life of occupants in design
  • Construction, and operation
  • Design that enables adaptation to a changing environment

Exponential Rise in the Demand for Greener Properties

There has been a huge rise in the demand for greener and energy-efficient properties not only in the UAE but across the Middle East. As per the Knight Frank – 2021 surveyproximity to green space and good air quality topped the list of location features and are more important to home buyers in the Middle East than their global counterparts. Half of the respondents cited the energy efficiency of their next home as being a ‘very important‘ issue, compared to 42% of global buyers.

There has been a rising demand for green and energy-efficient properties in the UAE. The region is at the pinnacle in the Middle East in the national concentration of sustainable buildings and stands at the 14th spot in the world with 869 green-rated buildings, according to the 2nd edition of Knight Frank’s (Y)our Space report – 2021 which surveyed almost 400 businesses worldwide on their workplace strategies and real estate needs.

This sends a strong signal to the developers and planners to embrace building green properties to attract eco-friendly homebuyers in the UAE.

Reasons for Rising Demand for Green Properties

Here are the top 7 reasons for the rising demand for Green Properties in the UAE

1. Increasing Awareness

The last decade has witnessed a colossal rise in the awareness among the UAE real estate developers and homebuyers about sustainable construction practices and the adverse effects of climate change, rising energy consumption, and carbon emission on their health and life which has significantly increased the demand for greener properties. 

The rising awareness about the advantages of green buildings is very evident from the leading studies conducted recently. The research conducted by EcoMENA in 2021 titled – ‘Green Building Trends in the Middle East’ reveals that in the last decade, green building design has become a top priority of real estate developers across the Middle East. The number of LEED-registered buildings has increased rapidly across the region, from 623 in 2010 to more than 2500 in 2020. UAE is ranked among the top 10 countries that hold LEED certifications in the world with Dubai ranked 3rd in the list of cities having the highest number of LEED-certified buildings. UAE has more than 600 LEED-certified projects.

2. Supportive Government Policies

UAE has launched the Net-Zero by 2050 Strategic Initiativeto reduce carbon emissions and will invest over AED 600 billion in renewable energy to minimize carbon emissions and move the nation towards cleaner energy. 

Other initiatives launched by the UAE to reduce carbon emissions which will increase the sales of green properties include –  UAE Vision 2021, the UAE Centennial 2071, and the UAE Energy Strategy 2050, which sets a 50% target for clean energy in the country, among others. The UAE government has already established several sustainable development goals which serve as a guiding principle for most upcoming real estate projects in the region.

3. Lower Construction & Operational Cost

Research conducted by the World Business Council for Sustainable Development (WBCSD) reveals that the cost of installing green building features and technologies is significantly overestimated. Many developers perceive that the upfront cost of a green building is, on average, 17% higher than the original cost of a similar traditional building, however, that’s not true. 

The research by the U.S. Green building Council (USGBC) reveals the initial cost of a green building is only 2%-3% higher than its non-green counterpart. Moreover, green buildings consume 25%-35% less energy than non-green buildings and have 14% less operation and maintenance costs than their traditional counterparts. 

Modern property owners also prioritize renting or leasing green buildings or apartments due to their cost benefits. Green buildings also allow developers to save 20% of the initial construction cost annually by reducing energy consumption. Furthermore, green buildings allow developers to complete large-scale green projects at a much larger scale resulting in more revenues and business expansion.

Using incentive technology such as Virtual Power Plants (VPP) combined with an onsite solar asset will further allow real estate developers to reduce the operational cost and utility cost and explore new models of maximizing income outside of increasing rent and making their properties more attractive for eco-friendly homes buyers.

4. Lower Rents & Service Charges

Green properties are a win-win situation for every stakeholder. Due to their lower construction cost and energy consumption, green buildings have minimal operational costs. This is indeed good news for the homeowners and tenants as lower operational cost of the building leads to a reduction in their energy bills, service charges, and rents.  

The lower service charges and rents often result in higher resident satisfaction and occupancy rate for the landlords and developers.

5. The rise in Environment-friendly Buyers

 Rising awareness about the adverse impact of emissions on the health of humans as well as on the environment has attracted a number of homebuyers toward green properties. This is encouraging real estate developers to construct more green properties to foster quick sales.

According to Khalid Bushnaq, CEO of Energy Management Services (EMS) “two years ago we had to convince property developers to go green and think about efficient energy. The majority didn’t know what ‘green’ meant and assumed there was an extra cost attached. Now developers want to go green and some are achieving Leadership of Energy and Environmental Design (LEED) certification, an internationally recognized green building rating system. Many large developers are creating their own green design guidelines to be followed by smaller developers building on their plot of land,” said Bushnaq.

There has been an exponential surge in buyers prioritizing green properties as they support a cleaner environment for future generations. 

6. Investors Prioritizing Greener Properties for Letting & Sales

There has been a rise in the investors and businesses prioritizing the green credentials of a property while making their purchase decision. This will indeed spur their saleability and rentability in the coming days. To cater to the demand of modern and environment-friendly buyers, real estate developers are coming up with greener properties and are evaluating the cost and the benefits of greenifying their portfolios.

7. Rising Sustainability Concerns

There have been rising concerns about sustainability among both residential & commercial clients. Corporates across the globe are showing great interest in going sustainable and prioritizing sustainable buildings for their offices.   

According to the 2nd edition of Knight Frank’s (Y)our Space report, “40% of firms have set a net-zero carbon target and, of those, 77% are aiming to achieve this by 2030. 87% of firms surveyed had less than half of their current global real estate portfolios either ‘green’ or ‘sustainable’.

Rising sustainability concerns among the buyers will accelerate the sales and rents of the green properties and will play a crucial role in minimizing the emission rate of the UAE.


Here is the summary of the article –

  • There has been a rise in the attractiveness of greener properties among buyers across the UAE to reduce carbon emissions and move towards a healthy lifestyle.
  • Climate change, COP 26, and UAEs investment in clean energy by 2050 have been the major drivers in raising awareness of green properties
  • Along with the residential, the commercial sector is also prioritizing moving their offices to green properties to prioritize employee’s safety and adapt to their occupational strategies
  • A Green building is a building that, in its design, construction or operation, reduces or eliminates negative impacts, and can create positive impacts, on our climate and natural environment.
  • The Knight Frank – 2021 survey on Middle East buyers reveals that proximity to green space and good air quality topped the list of location features. Half of the respondents considered the energy efficiency of their next home to be a ‘very important’ issue, compared to 42% of global buyers.
  • UAE is ranked 14th in the world with 869 green-rated buildings
  • The top reasons for the rising demand for green properties are as follows
  • Increasing awareness
  • Supportive government policies
  • Lower construction & operational cost 
  • Lower rents & service charges
  • Increase in environment-friendly buyers
  • Investors Prioritizing Greener Properties for Letting & Sales
  • Rising sustainability concerns among the buyers