Benchmark Report: Health Drives Value in Real Estate

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Written By Marcos Reynaga

The positive impact healthy building strategies have on human health has long been established. The growth of the Fitwel Standard speaks directly to this understanding, both responding to and accelerating market demand for buildings and communities that improve health outcomes. But a persistent question often follows in the wake of applying these strategies: Do the occupants themselves experience this difference on a day-to-day basis?

We now have data indicating the answer is yes.

Health Drives Value in Real Estate is a groundbreaking benchmark study from the Center for Active Design, operator of the Fitwel healthy building certification system, in collaboration with QuadReal Property Group, a global real estate investment, operating and development company. This report features findings from an analysis of 60 QuadReal properties, which points to the positive outcomes that health and wellbeing strategies have on tenant satisfaction, and in turn, financial outcomes.

"This research makes clear the value of benchmarking to transform the information about a portfolio into a pathway that owners and investors can act on to plan future investments.

— Joanna Frank, President and CEO of CfAD, operator of Fitwel

Fitwel score drives Net Promoter Score

As the Fitwel score for a property increases, the median score for property recommendation also tends to increase – demonstrating the value of broad investments in health.

Location drives residential rent 

Residential projects that satisfy Fitwel location strategies are associated with higher rent per square foot – more evidence of the value of walkable places with plenty of amenities.

Operations drive Net Promoter Score

Projects that implement Fitwel operations strategies are associated with a higher median property recommendation score – evidence that occupant satisfaction goes beyond tenant amenities.

Healthy food access drives Net Promoter Score

Projects that implement Fitwel healthy food access strategies are associated with a higher median property recommendation – a major opportunity as these are the least implemented strategies.

"One of the QuadReal team’s sustainability goals is to create healthy environments so our tenants and residents can flourish. From the start, we believed that investing in best-in-class operations and amenities would make healthier spaces. This aligns with our commitment to being a Responsible Company. Thanks to our collaboration with CfAD, we have found a clear correlation of a higher Fitwel score with a greater willingness of occupants to recommend the building to their friends and colleagues. This reinvigorates our conviction to invest in healthy buildings and benchmark wellness more broadly in our portfolio." 

— Jamie Gray-Donald, Senior Vice President of Sustainability & EHS, QuadReal Property Group

FOR IMMEDIATE RELEASE:

The Center for Active Design & QuadReal Release New Benchmarking Report Showing Prioritization of Health Strategies in Buildings Associated with Increased Tenant Satisfaction Outcomes & Real Estate Portfolio Value

Report shows role benchmarking plays in translating evidence-based strategies into concise data points that can then be used to instill trust, ensure tenant satisfaction, and ultimately, increase real estate portfolio value 

Launch of new Portfolio Benchmarking Tool will allow owners to easily assess portfolios against Fitwel healthy building standards

NEW YORK, June 8, 2022 — The Center for Active Design (CfAD), preeminent global organization working at the intersection of health and the built environment and the sole licensed operator of Fitwel®, the healthy building certification system, and QuadReal Property Group (QuadReal), a global real estate investment, operating and development company, today announced the release of "Health Drives Value in Real Estate," a new report that records the positive outcomes that health and wellbeing strategies have on tenant satisfaction, and in turn, financial outcomes. This report takes a people-focused (health) approach to looking at a portfolio of buildings, and found that evidence-based, health-promoting strategies can foster tenant satisfaction.

While the positive impact that healthy buildings have on human health has long been established, this report is significant as it directly shows a positive correlation between these strategies, tenant satisfaction outcomes, and financial benefits for real estate owners and investors.

By analyzing data from Fitwel scorecards, select property financial metrics from across asset types in QuadReal's portfolio, and tenant and resident survey results, the analysis found that health-promoting strategies were associated with positive occupant perceptions, even if they weren't publicized. In reviewing the Net Promoter Score (NPS)—the likelihood building occupants will recommend the property to peers— and financial outcomes, such as rent per square foot, the report found the following four factors to be most significant:

  • Healthy Food Access: Projects that implement Fitwel healthy food access strategies are associated with a higher median property recommendation, yet these are one of the least implemented strategies

  • Operations: Projects that implement Fitwel operations strategies are associated with a higher median property recommendation, indicating occupant satisfaction goes far beyond tenant amenities

  • Location: Residential projects that satisfy Fitwel location strategies are associated with higher rent per square foot, evidence of the value of walkable places

  • Fitwel Score: Increased Fitwel scores correlate with increased median score for property recommendation, demonstrating the importance of broad investments in health

"Demand for healthy buildings has never been higher and, now, the case for investing in them is even stronger," said Joanna Frank, President and CEO of CfAD, operator of Fitwel. "This research makes clear the value of benchmarking to transform the information about a portfolio into a pathway that owners and investors can act on to plan future investments. At scale, this will solidify health-promotion interventions as best practices across the real estate sector."

"One of the QuadReal team's sustainability goals is to provide healthy buildings to our tenants and residents so they can flourish. From the start, we believed that investing in best-in-class operations and amenities would make healthier spaces. This aligns with our commitment to be a responsible company," said Jamie Gray-Donald, Senior Vice President, Sustainability & EHS at QuadReal. "Thanks to our collaboration with CfAD, we have found a clear correlation of a higher Fitwel score with a greater willingness of occupants to recommend the building to their friends and colleagues. This reinvigorates our conviction to invest in healthy buildings and benchmark wellness more broadly in our portfolio."

Launched in tandem with the report is Fitwel's new Portfolio Benchmarking Tool which can be used by owners and investors to assess how a single asset or an entire portfolio is impacting occupant health and calculate how operations decisions will impact mental, social, and physical health outcomes. Users can use this data to meet industry and consumer demand. The Fitwel Portfolio Benchmarking Tool is available on the Fitwel Platform at app.fitwel.org.

About Fitwel

Fitwel is the world's leading certification system committed to building health for all. Generated by expert analysis of 5,600+ academic research studies, Fitwel is implementing a vision for a healthier future where all buildings and communities are enhanced to strengthen health and well-being. Fitwel was originally created by the U.S. Centers for Disease Control (CDC) and Prevention and U.S. General Services Administration. The CDC remains the research and evaluation partner for Fitwel. The Center for Active Design (CfAD), a global not-for-profit organization, maintains the Fitwel standard and conducts objective third-party assessments that lead to certified projects. CfAD's new business unit, Adai (pronounced "a-DAY"), is charged with expanding Fitwel to the global market, administering the program while providing best-in-class customer service and technical support. To learn more about Fitwel, please visit: www.fitwel.org.

About QuadReal

QuadReal Property Group is a global real estate investment, operating and development company headquartered in Vancouver, British Columbia. Its assets under management total $67.1 billion. From its foundation in Canada as a full-service real estate operating company, QuadReal has expanded its capabilities to invest in equity and debt in both the public and private markets. QuadReal invests directly, via programmatic partnerships and through operating companies in which it holds an ownership interest.

QuadReal seeks to deliver strong investment returns while creating sustainable environments that bring value to the people and communities it serves. Now and for generations to come.

QuadReal: Excellence lives here.

www.quadreal.com

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Media Inquiries:
communicatons@centerforactivedesign.org

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Marcos Reynaga
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