Climate change is transforming real estate, requiring investors to understand what can be done to reduce the impact of extreme weather events and temperatures on their assets. We often hear the terms “adaptation” and “mitigation” used interchangeably in the context of responses to climate change, yet there are differences between these approaches.
Mitigation aims to reduce the scale of climate change by reducing greenhouse gasses, while adaptation refers to how we adjust to and manage the current and future impacts of climate change. Both adaptation and mitigation can be put into practice in various ways and carry implications for real estate.
Real estate investors can leverage data on climate-related risk to take steps to adapt to climate change and protect their properties. Investors in different sectors may also look into ways they can mitigate their contribution to greenhouse gas emissions. Ultimately, mitigation efforts by governments and industries will determine the severity of climate change — and ultimately, the risk of climate-driven hazards to people and property alike.
Understanding Climate Mitigation
At a high level, the goal of mitigation is to alleviate the magnitude of climate change by reducing greenhouse gasses into our atmosphere. We can lessen the concentration of greenhouse gasses by either reducing them at the source (such as reducing fossil fuel emissions) or by enhancing greenhouse gas sinks (using techniques such as carbon capture).
Mitigation actions change our lived reality of climate change, and can take various forms. Some examples of mitigation actions include carbon sequestration and improving industrial processes to limit greenhouse gas emissions.
If governments and industries take more aggressive approaches to mitigation, this will reduce overall greenhouse gas emissions and set us on a path towards a more manageable climate change scenario. Less aggressive mitigation will lead to less reduction in greenhouse gas emissions, and thus more intense climate outcomes.
At ClimateCheck, we use multiple emissions scenarios that reflect different mitigation actions to curb the concentration of greenhouse gasses. This enables our clients to plan for different possible outcomes. The scenarios reflect how physical climate risk may differ based on how effectively we limit greenhouse gasses.
Understanding Climate Adaptation
The IPCC defines adaptation needs as “the gap between what might happen as the climate changes and what we would desire to happen.” Adaptation measures can refer to steps taken to adjust to climate impacts that are already happening, as well as anticipated impacts. These measures can be implemented at a regional, local or hyper-local level. Real estate investors can implement adaptation measures for individual properties.
Adaptation can lessen the susceptibility of properties to harmful consequences from extreme weather events and climate conditions. Adaptation can mean improving energy efficiency or designing buildings to better withstand certain hazards.
The impacts of climate change on properties can vary widely based on geography, a property’s unique vulnerabilities, the surrounding infrastructure and more. Investors can use ClimateCheck’s portfolio risk overview reports to determine where different risks are concentrated in their portfolios. Property owners can pull ClimateCheck’s individual reports for in-depth analysis of risk to individual properties. Our risk assessments can help owners and investors make properties more resilient to specific hazards.
For real estate investors seeking to better protect their existing properties, some examples of adaptation measures include:
- Securing HVAC systems to roofs to protect equipment during high wind events
- Ensuring windows and doors on ground floors are sealed to protect from flooding
- For properties in areas prone to wildfire, maintaining open space around the property that is clear of vegetation and debris
Data can also help investors adapt their growth strategy by helping them incorporate climate risk into decision making around buying and selling properties.
The Big Picture on Mitigation and Adaptation
At a high level, the larger mitigation measures governments and industries take today determine the adaptation measures we must all take to prepare for the future. Adaptation will become increasingly important as our planet warms, so it is crucial to understand how to protect properties and portfolios from current and future risk.
ClimateCheck assesses risk across multiple climate-related hazards, including but not limited to flood, fire, heat, drought, and precipitation. Our assessments help investors understand current and future risk to individual properties as well as larger portfolios. Learn more about our risk assessments and how to use climate risk data to make your properties more resilient.