May 11, 2023

How real estate is preparing for electric cars

As charging infrastructure expands, industrial real estate could play a big role.

Landlords are increasingly incorporating charging infrastructure into their buildings as part of plans to make their portfolios more sustainable.

Take Lendlease, which is installing at least 80 electric vehicle (EV) chargers in its properties, including popular shopping complexes in Australia.

In the U.S., industrial developer Clarion Partners has established more than 348 chargers for electric vehicles (EVs) across its properties.

“Buildings are the green petrol stations and power stations of our future,” says Renae Gasmier, head of Sustainability Consulting – Australia, JLL.

The projects come as EVs account for 14% of new car purchases globally, according to the Australian Electric Vehicle Council. China leads the way with EVs making up 28% of car sales in 2022, while Australia is lagging with only 4%. New EV sales in the U.S. made up 7% of total sales to January 2023, according to Inside EVs.

With electric cars on the ascendency, the property industry is looking to stay ahead of the curve.

“By building EV charging infrastructure, we’re not only meeting growing demand, but also creating a whole new source of power-grid support because the grid can also draw or store power from EV batteries,” says Gasmier.

Providing car charging stations isn’t just going to help countries toward their sustainability targets. Buildings deemed “green” drive higher occupancies, rents, tenant retention and asset values, according to a 2022 JLL survey of investors and occupiers.

A role for industrial real estate

A report from the Australian Electric Vehicle Council notes that less than 0.5% of all cars on Australian roads are EVs. However, to reach the International Energy Agency’s target of net zero emissions by 2050, the number must be close to 100% by then.

Industrial real estate occupiers and owner-occupiers could be the most influential in achieving this, Gasmier says. This is because many logistics and other distribution companies are looking to electrify their fleets.

“That said, there are a lot more considerations in industrial real estate compared to elsewhere, such as ensuring you’ve got enough power supply capacity, battery storage and the availability of fast charging,” she says. “Industrial real estate is also the critical infrastructure that surrounds supply chains, and supply chains are within many organizations’ Scope 3 emission reductions.”

It may be tempting to engage hardware and software providers, and charge point operators, in a seemingly turnkey deployment. However, failure to carefully evaluate and strategically plan for EV charging infrastructure can lead to lackluster results characterized by greater expense, a stressed power grid, low quality implementation or missed revenue opportunities.

The risk is being short-sighted, Gasmier says.

“There are new business models and technology emerging and organizations need to consider this to take full advantage of the future value,” she says. “There are also considerations around load management systems, peak charging times and power capacity.”

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