Not created equal: Study of New York City and London real estate finds strong evidence for a ‘green premium’
There is consensus around the existence of a green premium, although it is important to note some studies find little correlation between sustainable characteristics and price despite others determining that green buildings can generate price premiums of more than 30 percent.
These studies have generally been focused on the office sector, where data is most available and the drivers are clearer. However, the majority were conducted pre-pandemic, and the resulting changes to the sector since 2020 have made comparability more challenging and have made it harder to draw conclusions from recent findings.
In a recent study, UBS Asset Management, Real Estate & Private Markets’ (REPM) green premium research focuses on the two largest financial centers in the world, New York City and London. The research examines 1,453 office building transactions in New York City and London between 2010 and 2022, running a regression to analyze the economic implications of environmental