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Decarbonisation: The time is now for convergence of property disciplines

Roland Moore - Sodexo's Head of Estate Strategy
About the author : Roland Moore, Head of Estate Strategy

Roland Moore leads the Estates Strategy, Sustainability and Asset Management teams supporting our clients on the maintenance, development, and transformation of their estates and also the decarbonisation journey towards Net Zero. Throughout his career, Roland has developed a broad experience of operational management and technical leadership in construction, maintenance, facility and asset management, telecommunications, sustainability and waste management.

Published on : 3/17/22
  • The UK commitment to net zero carbon by 2050 requires a new mindset and affirmative action by all clients, property professionals and the wider industry. The built environment lags behind other sectors and must act faster by making the most of the opportunities that exist in the post-Covid economy.

    The impact of Covid on the workplace has been stark. Only two years ago, it would have been inconceivable to imagine that the majority of office-based employees could move to home working overnight. Whilst some sectors have started to return to the office, there is certainly a positive legacy of home working that will endure as a new hybrid form takes its place in a more balanced approach to our working lives. This has, and will continue to have, a profound impact on the amount and type of space that organisations need to function effectively. This should act as a tailwind for the decarbonisation journey whilst also providing bottom-line savings, if managed in the right way.

     

    The impact of hybrid working

    The new ways of flexible and hybrid working are helping to support the employee value proposition as employers reconfigure space to create an environment for collaboration and creativity, whilst maintaining social connection – which is a significant shift from how the traditional office space was used. This is a fantastic opportunity to address legacy buildings as part of these changes and make them much more efficient and sustainable. At the same time, property managers, owners and investors need to think creatively about how to re-purpose the excess space that these profound changes will create. Market forces will drive new, interesting and innovative formats for workspace and sustainability should form a central theme in this transition.

    Alongside the big shifts we have seen in the demand side of the commercial property market we are also seeing sharp rises in operating costs and the return of inflation. Having lived through a relatively benign inflation environment for over a decade, cost pressures are beginning to bite across all cost categories.

    The pressure on property professionals to deliver has never been greater. It is time for bold ideas and creative thinking to adapt and find new solutions for the future. It is a fantastic opportunity requiring the best and brightest from the public and private sector to come together.

     

    Meeting the challenge that lies ahead

    Estate optimisation inputs
    Estate optimisation inputs

    The recent publication of the UK Government’s Net Zero Estate Playbook is a welcome step as public sector organisations grapple with what net zero means for them. It is a logical and well-structured road map to aid the journey over the coming decades. The approach set out will facilitate the thinking and analysis required to progressively reduce carbon emissions from the public sector estate.

    It is encouraging to see that the playbook advises occupiers to incorporate the decarbonisation imperative into their estate strategy and associated strategic asset management plans rather than attempting to implement it as a separate programme. This holistic approach is essential in the journey towards achieving estate optimisation, something Sodexo has developed as part of its Property Professional Services offering, which is already benefitting clients and gaining traction.

    The estate strategy should always be reflective of the broader aims of the organisation and delivered through a robust approach to asset management.

     

    The role of analytics in the decarbonisation journey

    Critical analysis is an imperative for all key stakeholders at each location to expedite actions that will support the decarbonisation journey across the estate. This includes measuring the factors highlighted in Figure 1 with reliable data to assist in determining whether the asset meets the organisation’s needs. The figure gives an indication of the asset metrics that should be considered (as a minimum). There will always be other considerations, which can be customised to each client’s unique characteristics. It is important to also take account of wider organisational strategies and their implications such as business growth, people and IT.

    Sodexo have developed market leading property analytics, which can be tailored to each client, to assist with decisions around prioritisation for investment and divestment on an estate- wide basis. The example shown in Figure 2, the Building Performance Index, was developed and implemented on a high-profile government department’s estate of approximately 850 properties and provided tangible evidence for estate optimisation decisions. The recent RICS International Building Operation Standard (IBOS) publication is aligned to Sodexo’s approach through the company’s Building Performance Index, highlighting the need for consistency in benchmarking to support data-based decisions on building optimisation, user experience and sustainability factors.

    Building Performance Index

    The approach outlined will help identify the optimum estate size required for an organisation’s current and planned operations. Only once the optimal estate is identified can the decarbonisation strategy be overlaid. This is where the convergence of professional disciplines is essential. The following steps brings this to life alongside Figure 3:

    1. Estate optimisation and decarbonisation cycle
      Estate optimisation and decarbonisation cycle
      The strategy and portfolio planning professionals develop and refine estate strategy to optimise future provision.
    2. The architects and surveyors determine the design and configuration of future estate and the investment required.
    3. The asset managers determine when the changes should occur to maximise value from the estate.
    4. The energy and sustainability professionals work with the surveyors, engineers and architects to determine the asset changes required to reduce emissions, whilst also embracing circular economy principles.
    5. Project managers and PMO teams deliver the change as part of defined programmes of work.
    6. FM professionals fine tune the operating and maintenance criteria and report on how the estate is performing.
    7. Supply chain managers will ensure that suppliers are engaged in the contract and are aligned with the decarbonisation targets, supporting Scope 3 reductions.
    8. Seeking necessary funding to implement change should be underpinned by technical and financial modelling to create a compelling business case through estate strategy professionals. Understanding of client’s processes and engaging stakeholders is crucial to ensure modelling is embedded in the cycle and necessary approvals gained.

    All this needs to be done in a systematic way using interim targets (ideally SBTi aligned) on the journey towards net zero, through the asset management planning cycle outlined in Figure 3.

    In a complex process involving many stakeholders over a long period of time. Which professional body is responsible for leading and driving the process to deliver decarbonisation? All of them, but it needs to be done in a coordinated and collaborative way with clear purpose and alignment of objectives. 

    At Sodexo, property professionals work across all these disciplines and harness their collective value by codifying knowledge and creating agile and repeatable processes that support dynamic capabilities. The teams are hard wired to improve through each deployment cycle. The case study below helps to bring this to life.
     

    Case study

    Sodexo are currently engaged with a high-profile public sector client in Northern Ireland on a large, complex estate. Working with its client, the team has developed an Estate Strategy which aims to optimise and reduce the size of the estate over time.

    Strategic portfolio assessment matrix
    Strategic portfolio assessment matrix

    Operational suitability of the estate has been established through engagement with key customers and employees. This has been collated with the estate condition, following detailed asset surveys of the 300,000 sqm estate. 

    The outcome - identifying the future of each location (maintain, upgrade, change, divest) will lead to a reduction in floor space to reduce operational spend and future maintenance liabilities. Capital investment to modernise and upgrade has been modelled to also show net cash savings over a 15-year period. 

    The output from the matrix forms the foundation of the optimisation decisions as outlined previously in figures 1-3. Significant opportunities for rationalisation have been identified as well as optimising the estate to meet future requirements. This brings a substantial reduction in operational expenditure.

    Carbon modelling has been developed and is in progress for every asset and will be programmed against lifecycle maintenance through the asset management plans. They will be refined and evolve through interim targets towards net zero over the coming decades, ensuring critical estate decisions are completely aligned. The client is ahead of the curve and knows the changes required on the estate and the associated financial implications.
     

    How can we help?

    Sodexo’s Property Professional Services team have the skills, capacity and resources through our multi-disciplined professionals to provide strategic advice to public sector bodies to optimise and decarbonise estate portfolios across the UK and Ireland. Learn more about Sodexo's Property Management and Advisory Services or contact us to talk to us about your challenges and how we can help.

    Contact us

    Visit us on Stand 5 at Government Property 22, Thursday 24 March, QEII Westminster.