Webinar: 17 April 2026 9.15am – 10.15am
On Friday 17th April, 2026, AREF and CREFC Europe brought together senior voices from across investment, lending and valuation for a timely discussion on how ESG is shaping real estate finance.
Chaired by Sonam Thakrar, Associate Director at M&G Real Estate, the webinar featured insights from Olivier Elamine, Senior Advisor and former CEO of Alstria, Dave Davies, Head of Real Estate Lending at Barclays, and Sam Carson, Senior Director, Head of Sustainability, Valuations Advisory at CBRE.
The conversation explored how ESG is being interpreted across the REF market, how lenders and borrowers are responding, and where the biggest challenges and opportunities lie as the industry continues to adapt.
ESG is no longer separate from business strategy
A recurring theme throughout the discussion was that ESG should not be treated as a standalone workstream. Instead, it is increasingly being absorbed into mainstream business strategy, risk management and investment decision-making.
Speakers noted that while definitions of ESG can still vary, the most useful lens is often to view it through the prism of future value protection, resilience and risk management. This includes managing exposure to regulation, operational inefficiency, climate-related risks and shifting occupier and investor expectations.
There was also a clear sense that, compared with a few years ago, sustainability is becoming more embedded in everyday commercial decision-making. Rather than sitting alongside the business, it is increasingly becoming part of how buildings are financed, valued, adapted, improved and operated.
Regulation remains important - but uncertainty is unhelpful.
The panel discussed the ongoing challenge posed by regulatory uncertainty. While there is broad understanding of the direction of travel, inconsistent timelines and shifting policy signals continue to make decision-making more difficult for owners, operators and lenders.
Energy performance certificates remains the most widely used market metric, despite acknowledged limitations. They continue to provide a common reference point for lenders, valuers and investors, particularly in the absence of a more developed and consistent framework.
At the same time, speakers highlighted the frustration created when policy goals are signalled but not followed through with clarity or stability. This can create inertia, delay investment decisions and, in some cases, disincentivise early action.
Better-performing buildings are showing greater resilience
The discussion also examined the relationship between sustainability performance and value. While panellists took different views on how this should be interpreted, there was agreement that more efficient buildings are generally proving more resilient.
From a valuation and lending perspective, stronger-performing assets are increasingly seen as better placed to withstand energy cost volatility, future capital expenditure requirements and tightening regulation. In contrast, inefficient buildings may face both a pricing discount and a greater need for intervention over time. One of the speakers noted that time and money were key limitations when considering the need to transition.
The panel also noted, however, that the picture is nuanced. Value should not be judged only at a single point in time, and the long-term return profile of an asset depends not just on where it starts, but on how it is managed, financed and improved through its lifecycle.
Green finance has evolved — but transition finance remains a gap
A key part of the conversation focused on how sustainable finance has changed in practice.
The panel noted that sustainability-linked lending has become less prominent in some areas, partly because of its complexity, reporting burden and relatively limited pricing benefit. By contrast, green-labelled lending such as green loans, particularly where use of proceeds can clearly be linked to stronger-performing assets, has continued to grow.
However, speakers agreed that the more difficult challenge is financing the transition of existing assets.
This is where much of the work still needs to happen — and where current lending structures can struggle. Traditional bank lending is often better suited to financing standing assets than funding significant capital expenditure programmes, especially where those works are needed to reposition older buildings.
For borrowers without access to large balance sheets, this creates a real challenge. While some alternative lenders and private credit providers are active in this space, the cost of capital can be high, and there is not yet a scalable market-wide solution.
Transition needs a broader definition
The panel also challenged the market to think more carefully about what is meant by “transition”.
Much of the current focus is on decarbonisation and electrification, but speakers argued that adaptation also needs greater attention. This includes making buildings more resilient to the physical effects of climate change — from changing rainfall patterns and drainage requirements to roofing performance and overheating risk.
These interventions may be commercially important, but they are not always recognised within existing ESG or green finance frameworks. As a result, there is a risk that parts of the market focus too narrowly on carbon metrics while underestimating the practical measures needed to protect buildings in the years ahead.
Operators matter as much as assets
Another important point raised was that lenders and investors are not only assessing the quality of the asset, but also the quality of the operator.
Track record, capability and the ability to execute a credible business plan are becoming increasingly relevant in how finance is assessed. Two owners may hold similar assets, but the outcome can differ significantly depending on how those assets are managed, improved and positioned.
This reinforces the idea that ESG performance is not solely a building-level issue. It is also shaped by governance, operational expertise and the extent to which sustainability considerations are genuinely integrated into investment and asset management decisions.
Looking ahead
In closing, the panel reflected on the next 12 months and the need to maintain focus despite a difficult commercial backdrop.
While market conditions remain challenging and capital is constrained, speakers agreed that sustainability considerations are now more embedded than they were even a few years ago. The conversation may be quieter than before, but that is in part because ESG is becoming more operationalised and more closely linked to core business activity.
The discussion ended on a note of cautious optimism: the tools, frameworks and market understanding are continuing to evolve, but greater consistency, clearer regulation and more scalable transition finance solutions will be critical if the industry is to accelerate progress.
Event resources
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