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Bügl, R, Leimgruber, C, Hüni, G R and Scholz, R W (2009) Sustainable property funds: financial stakeholders' views on sustainability criteria and market acceptance. Building Research & Information, 37(03), 246–63.

  • Type: Journal Article
  • Keywords: key financial stakeholders; market acceptance; responsible property investment; sustainability criteria; sustainable real estate funds
  • ISBN/ISSN: 0961-3218
  • URL: https://doi.org/10.1080/09613210902843494
  • Abstract:
    Sustainable property (real estate) funds (S-REFs) have started to enter international finance markets. An investigation in the German-speaking parts of Switzerland examined two key questions: (1) the sustainability criteria that institutional real estate investors and real estate fund (REF) suppliers regard as important for the market success of S-REFs; and (2) how they assess the market acceptance of such funds. Focus groups were conducted to define sustainability components for S-REFs from a market success perspective. A questionnaire study was then undertaken to assess the two key questions. Factor analysis identified four independent sustainability factors: (1) building materials and energy; (2) expenses, return, and flexibility; (3) green space design; and (4) landscape and natural ecology. In the factor analysis, the set of criteria relating to sustainable social infrastructure did not form an independent factor. In total, 76% of the responding institutional investors decided on an S-REF investment, and 38% reported accepting return shortfalls against the REF benchmark. The market acceptance of S-REFs by institutional investors depends on cognitive drivers, institutional context, age, and family status of investors. These results can inform the design of S-REFs, marketing strategies, and sustainability ratings.