James Darley writes on the Energy Digital website about the sustainability report from the Royal Institution of Chartered Surveyors RICS. Its sustainability report 2025 examines sentiments from over 3,500 global professionals in the commercial real estate and construction sectors, in order to understand how the climate agenda is shaping trends and practices across the world. This year’s report suggests that demand growth for green buildings has slowed, and the sector remains stagnant in adopting sustainable practices.
RICS & Exergio: Why is Interest in Green Buildings Falling?
New data reveals occupier interest in sustainable real estate has fallen from 41% to 30%, with RICS and Exergio warning financial viability needs proving
The market for green buildings is losing steam across most global regions, according to new research from the Royal Institution of Chartered Surveyors (RICS), with demand sliding sharply over the past year.
This lull in interest from the private sector comes in spite of the growing pressure to decarbonise the built environment.
RICS’s 2025 Sustainability Report shows that demand for sustainable real estate has dropped from 41% to 30% globally, with the steepest decline occurring in the Americas where the index has fallen from close to 50 in 2021 to just 11 in 2025.
The findings paint a troubling picture for a sector responsible for nearly 40% of global carbon emissions, with high upfront costs and uncertain financial returns cited as the primary obstacles preventing investment in energy efficient buildings.
The issue with energy efficiency certifications
One of the most concerning things for energy professionals is the growing disconnect between what investors prioritise and what people living in homes actually want when it comes to energy performance.
While 86% of investors prioritise green building certification, RICS finds that energy efficiency is the top priority of 88% of residents. This wouldn’t be an issue if certificates were always representative of a building’s real-time energy performance.
“Occupiers care about how a building works; investors care about how it’s labelled,” says Donatas Karčiauskas, CEO of Exergio. “Until performance and certification point in the same direction, we’ll keep building assets that look sustainable on paper but don’t deliver it in practice.”
This discrepancy suggests that there is a real misalignment between what buildings claim to achieve versus what they actually deliver in practice. For Donatas, this gap is beginning to undermine the entire market.
“Investors aren’t against building sustainably – they just need proof it pays back,” he explains.
“If a project requires expensive materials, equipment and certifications but the real-world performance doesn’t translate into measurable savings, why would anyone scale it?”
His company, which develops AI tools that promote energy efficiency in real estate, reports that it has achieved energy reductions of up to 30% in its portfolio of commercial buildings, which translates to savings exceeding US$1m annually.
The RICS data reveals that between 35% and 46% of respondents cite uncertain return on investment or insufficient data on operational benefits as key barriers to acquiring green buildings.
The flaws in the construction industry’s data
The report also exposes a fundamental weakness in how the construction industry tracks energy and carbon performance.
Around 46% of construction professionals admit they do not measure carbon emissions on their projects at all, a figure that has actually increased over the past year.
Elsewhere, just 16% say that they measure carbon in a way that influences their choice of materials and components.
“You can’t improve what you don’t measure, and you can’t measure what you don’t have the skills to assess,” Donatas says. “Right now, most carbon decisions are built on assumptions instead of real evidence.”
This knowledge gap extends right across the sector too. Only 17% of RICS’s respondents believe that the industry possesses adequate sustainability expertise and only 10% report that they are familiar with whole-life carbon assessment methods.
The global picture for sustainable real estate
While global demand for sustainable real estate has cooled overall, the Middle East and Africa is showing growth. This year, the region has a Sustainable Building Index reading of 52 compared to the global average of 30.
Europe, which was previously the strongest market, has seen its index fall from consistently high readings to 39 in 2025.
The shift in the Americas appears linked to changing political priorities, though weak occupier cycles across commercial property markets have also played a role.
Energy efficiency remains a top concern for 94% of occupiers when evaluating buildings, yet this priority is not consistently reflected in investment decisions or operational practice.
Nicolas Maclean, who is Acting President of RICS, sees ROI as just one piece of the puzzle.
“In addition to high upfront costs and uncertainty around long-term returns, lack of knowledge and awareness about green buildings has emerged as a significant obstacle impeding investment in sustainable assets,” he says.
“This raises the question of whether the full climate, environmental and social impacts of sustainable assets are consistently understood across regions.”
Can AI optimisation solve the problem?
Industry experts argue that artificial intelligence offers the only viable path to closing the performance gap at scale.
“AI closes the gap the industry can’t close on its own,” explains Donatas. “It proves ROI with real performance data, aligns what occupiers want with what investors pay for, and automates optimisation that today requires scarce expertise.”
The technology can gather performance data automatically, interpret it without specialised training and adjust building systems continuously, addressing both the measurement problem and the skills shortage simultaneously.
Without such intervention, even renovated or newly certified buildings are likely to continue missing both climate targets and the financial performance that would justify further investment in sustainable real estate.
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Energy in Demand - Sustainable Energy - Rod Janssen 