Sustainability Is a Bright Spot in JLL's Latest Ranking of Global Transparency

Improvements in commercial real estate transparency are slowing, despite greater emphasis on corporate responsibility and the widespread use of new technologies, JLL and LaSalle reported in its 2020 Global Real Estate Transparency Index.

Top-performing “Highly Transparent” markets, including the UK, US, Australia and France, are driving higher standards in sustainability in the real estate services company’s biennial survey, while sustainability initiatives helped markets such as Abu Dhabi, Costa Rica and Belgium move up the rankings.

“Sustainability commitments have become the biggest single driver of real estate transparency globally since 2018,” said Jeremy Kelly, Director, Global Research, JLL. “As companies demonstrate an unwavering commitment to corporate social responsibility, there is increased voluntary adoption of Environmental, Social and Governance (ESG) measures and greater acknowledgement of the need to create a sustainable built environment.”

The company conducted its survey in February and March, before the full effects of COVID-19 pandemic had become clear. JLL and LaSalle is forecasting that the pandemic will help stimulate the use of technology that tracks real estate activity, especially as it relates to health, mobility and space usage.

As one example, the survey notes that the National Multifamily Housing Council and the National Association of Real Estate Investment Trusts pooled data on rent payments from software firms and property owners within a few weeks of the crisis escalating and have continued to maintain the collaboration. “This has provided visibility into a previously opaque indicator and informed both policymakers and business through the crisis,” the survey notes.

JLL’s 10 most transparent markets comprised the UK, US, Australia, France, Canada, New Zealand, the Netherlands, Ireland, Sweden and Germany. “Transparency has been boosted in these ‘Highly Transparent’ markets by a combination of proptech and new data, sustainability initiatives, anti-money laundering regulations and enhanced tracking of alternatives sectors,” the survey states.

Singapore, Hong Kong and Japan are among the markets that sit just below the ‘Highly Transparent’ tier. China’s Beijing and Shanghai markets also nosed into the second tier, thanks to what JLL described as improved market fundamentals data, an active property technology sector and more coordinated land-use planning. “While there remains a large disparity in transparency levels within the country, these improvements have helped to push Mainland China’s leading cities, Shanghai and Beijing, into the ‘Transparent’ tier for the first time,” the survey states.

Among the lowest, “opaque” tier, Libya, Lebanon, Tunisia and Tanzania showed regression, but some improvement could be seen in Honduras and Ivory Coast, according to the survey.

While transparency is progressing across most countries and territories, “overall improvement is the weakest since the period directly following the Global Financial Crisis,” the survey concludes.