Hotel valuations ‘now linked to sustainability’

Investors in hotel properties are driving the green agenda in travel as asset valuations become linked to measures of sustainability.

Ufi Ibrahim, chief executive of the Energy & Environmental Alliance (EEA), said existing green regulations were already forcing the hospitality investment community into action.

EEA is working on an independent global certification scheme for properties that is “credible, scientifically robust and commercially viable” with sustainability method Breeam.

Any certification has to be “substantiated by hard evidence”, otherwise it will be accused of “greenwashing”, said Ibrahim.

She said 80% of the global building stock that will exist in 2050 is already built, so operational performance, including how guests travel to and from hotels, can be measured.

“Investors are the ones driving the pressure,” Ibrahim said. “They are auditing every property in their portfolios and valuations are changing.

“We are working with the investment community to ensure the criteria is fit for purpose. The world is changing.

“We no not need more regulation. Existing regulation has been enough to force the investment community and that has led to action.”

Ibrahim said any sustainability scheme that relies of self-certification tick boxes stands accused of greenwashing.

“It has to be transparent and has to be credible and scientifically robust and commercially viable. If it’s not achievable there’s no point. Most importantly it has to be objective.”

Given the diversity of hotel properties around the globe, the challenge is to come up with a common standard that can be applied to all, but Ibrahim insisted it is possible.

She said it’s not enough for hotels to just focus on reusing towels or how often rooms are cleaned or cutting out single use plastics or carbon offsetting schemes.

“As investor pressure increases they need to know that the building is fit for purpose. I believe sustainability is a hygiene factor, consumers expect it but they do not expect to pay for it.”

This poses particularly “hard questions” in the luxury sector in which clients expectations of service levels are high but they don’t expect to pay to ensure they are sustainable.

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