GREEN BUILDING: REAL ESTATE INVESTMENTS AND SUSTAINABLE DEVELOPMENT
Not all buildings are created equal
Can a spring, a watercourse, be considered an immovable property? According to
Catullus (84-54 B.C.) in his famous Poem 70, most definitely not: sed mulier cupido quod dicit amanti, in vento et rapida scribere oportet aqua (“but what a woman says to her desirous lover is fitting to be written on the
wind and on fastflowing water”). In fact, article 812 of the Italian Civil Code
states that «the soil, springs and watercourses, trees, buildings and other constructions,
even if tied to the soil on a temporary basis, and, more generally, all that is
naturally or artificially incorporated to the ground» are immovable property. It is nevertheless quite clear that immovable property, construction, architectural
work are the clearest and most durable sign of man’s otherwise contingent passage
In economic jargon, immovable property often acts as a “store of value”, as a secure investment that over time rarely or never loses all value, or that may even increase, thereby
acting as a counter measure against economic instability or high inflation. Nevertheless,
it should be observed that this conviction has been deeply shaken by the rampant
speculation of the recent past, such as that occurring in the United States in
2006 with dire consequences on the world economy. Yet the majority of individuals
continues to attach sentimental and symbolic value to the “house” – a value going
well beyond the mere concept of bricks and walls.
From the point of view of an insurance company – without taking into account
the various forms of ropertyrelated policies – real estate investment is a deeply
engrained activity: in Italy, ISVAP Ruling n. 36 of 2011 (article 17 of part III)
sets down that out of the assets backing technical reserves, real property investments
can amount up to 40% of the total. In 2011, Generali, for example, invested 4.9%
of the total in lands and buildings. Taking for granted all financial considerations,
it is therefore not surprising that a company like Generali has accumulated in
its 180-year-old history a staggering amount of property, much of which of outstanding historical importance, such as the Procuratie Vecchie in Venice, or the buildings at piazza
della Signoria in Florence and in Piazza Venezia in Rome, the latter a fine example
of the classic and the modern blending perfectly in a magnificent setting. Assicurazioni
Generali’s significant growth in the early part of the 1900s following a continuous
streak of outstanding results led the management to launch a sweeping property
investment programme, whose ultimate aim, other than the obvious one of diversifying
commitments, was to give the Company “a home” in the heart of the major cities
as well as an adequate visibility of the financial strength it had achieved.
This huge estate, consisting of property assets worth €28 billion, is presently managed by Generali Real Estate, the new entity concentrating all real estate services and activities of the
Generali Group at an international level that, at its debut on 1 July 2012, had
altready emerged as one the leading players in the European real estate sector.
Palazzo Generali in Rome: ante litteram innovators
The most representative building of Assicurazioni Generali’s vast estate in Rome
is the one located at piazza Venezia, opposite “palazzo Venezia” and against the
background of the “Vittoriano,” the monument, dedicated to King Vittorio Emanuele
II, celebrating the Unification of Italy. The allure of locating Generali in that
venue was expressed in the will of the then chairman Marco Besso to “place La Venezia – as Generali was called in Italy at that time – in Piazza Venezia, opposite
Palazzo Venezia,” but above all to have “a venue constructed by the Company for
the Company in Europe’s principal centres, choosing the most conspicuous locations,
all decorated by our dear Lion.” Curiously enough the building’s foundations are
made up of some 3,500 timber piles in Aleppo pine that in water harden and do
not rot, exactly like the foundations of the most important buildings along the
Canal Grande… in Venice. For this was the most efficient way to overcome the obstacles
represented by a small underground stream “that flowed below the ground impetuously and often with abundant water.”
The following is from the daily “Il Popolo Romano” of 9 March 1906: “Yesterday morning the scaffolding was removed from the new Palazzo Venezia… A
sight truly magnificent that had passersby awestruck. In the course of the entire
day people stood by… to admire this monumental edifice, the most beautiful of
its type in the new Rome. When the last of the wooden panelling will be taken
down, the effect will be marvellous.”
The Palazzo, in addition, presented solutions at that time truly innovative.
“It was endowed with radiator heating from the basement up to the tower. Staircases,
floors and rooms all have electric light. In the offices and apartments, gas is
available while all rooms have toilettes and bathrooms.” “The new venue of Assicurazioni Generali – “La tribuna di Venezia” reported at that time – will henceforth be considered
one of the most outstanding architectural works made by private citizens in Italian
Rome,” giving to the men of Assicurazioni Generali the possibility to live in
the heart of the capital’s commercial and cultural interests, at the same time
turning them into the privileged witnesses of the founding events of the nation.
Real and green estate
A distinguishing trait of the Generali Group’s real estate investment and management
policy has always been the attention given to environmental aspects.
Generali’s green conscience may probably be traced back to the 1850s when the
Company finalised its earliest land investments. In 1851, Generali purchased in the Veneto region a vast property, mostly marshlands,
occupied by a smattering of huts. The massive land reclamation drive that followed,
involving the digging of canals and the construction of a water pumping system,
led to the establishment of Ca’ Corniani, a farm spreading across an area of 1,770 hectares.
From those pioneering days, of course, things have changed significantly, but
that environmental concern has remained and become stronger over the years – a
process towards a reconciliation of environmental, social and economic demands
first outlined at Ca’ Corniani, with the establishment of a farm that starting
with the resources of the land could also offer local farmers the possibility
of social redress. That approach has since been progressively codified in the
concept of sustainable development within the framework of the Environmental Management
System created by Assicurazioni Generali.
One of the key pillars on which sustainable development rests is the concept
of green building, or green construction. But what exactly is a “green building”?
The green building concept can be linked to the awareness that developed around a new way of conceiving the constructed environment in the past 30 years following the oil crisis of the 1970s, where maximum focus
is given to low environmental impact and high efficiency options throughout the
building’s life, from the choice of the site to the design, from the construction
to the maintenance, from the restructuring to the demolition.
Within this far-reaching theme, where technology plays a key role in ushering
ever more innovative solutions, there are nevertheless a number of recurrent factors,
- the efficient use of energy – through the maximisation in the saving of non-renewable resources and optimising
the renewable ones (sun, wind, water, etc.)
- focus on environmental impact – by minimising pollution and wastage so as to affect as little as possible
- maximum focus on the health and wellbeing of persons, both workers during the construction phase and, successively, future residents
- selection of “efficient” materials (wood from renewable plantations, recycled metal, heat-efficient concrete…)
- special care, at an aesthetic level, to ensure that the construction blends with the surrounding environment.
Against this backdrop, green buildings have been recording a constant upward trend in both the residential and non-residential building sectors in northern America
and Europe alike. According to some estimates, non-residential green construction
grew 2% in 2005 to 10-12% in 2008, with growth expected to increase 20-25% by
In the United States the ecological construction sector is expected to create some 7.9 million new jobs in the 2009-2013 period
(McGraw Hill Construction data). According to Green building economy, the first comprehensive report on construction, efficiency and renewable resources
compiled by Giuliano Dall’O’, professor of environmental physics at the Milan
Polytechnic, there has been in Italy a growing attention for efficiency: latest
short-term data showed that 56.6% of buildings constructed or finalised in 2010
were highly efficient in terms of energy consumption; while projects for 2011,
or starting in 2012, indicated that the number of class A and B buildings are
expected to rise. We would like to recall that coming under Class A are those buildings with a consumption level of under 30 KWh/sq m per year,
which translates in an annual consumption of between € 200 and € 330 for every
100 sq. m of residential space. An “F” Class home consumes per sq.m. respectively
5 times more than an “A” Class one, the triple of a “B” one and more than the
double of a “C” one. But other than consumption, value too should be taken into
account: it has been calculated, in fact, that a Class A house is worth € 450
more per sq. m while a Class C one is worth only € 200.
The Generali Group’s Green Buildings
Generali has developed within its ranks expertise and competencies for the monitoring
of its estate and the implementation of the latest in technology aimed at maximising
energy saving, at minimising emissions and water consumption and at optimising
recycling – factors increasingly in demand among leaseholders and tenants.
A case in point recently occurred in France where Marks & Spencer, the famous
high street UK retailer, chose the building at 100 Avenue des Champs Elysées for
its first ever store across the Channel. The immeuble has been entirely renovated and restructured by Generali utilising state-of-the-art
technology besides being one of the first in France to be endowed with a LED lighting
system. In Italy the Italian Operations Head Office, in Mogliano Veneto, and buildings
in Milan as well as in Rome have been subject to specific improvements aimed at
higher energetic efficiency.
The Group has introduced across its entire European real estate portfolio the
“Green Rating” campaign aimed at measuring the environmental performance of selected groups
of building by means of tangible indicators, such as:
- energy consumption
- CO2 emissions
- water consumption
- waste cycle
These indicators allow to identify areas where improvements can be achieved, besides allowing
for comparisons to be made with competing buildings. They also enable the singling
out of risks connected to technical ageing.
An improvement of the “Green Rating” coincides not only with the improved energy
performance of the building (reduction of consumption levels for winter and/or
summer air conditioning) but also with comfortable and convenient public transportation,
with the proximity of green areas, with a rational and appropriate waste management,
with an optimised use of natural resources – all aspects that contribute to reduce
property management costs while boosting commercial values.
These activities have enabled the Group to obtain a number of significant environmental
quality certifications. The EOS complex at Issy-Les-Moulineaux was among the first
to obtain the High Environmental Quality Construction certificate, while Terra
Nova 3 at Montreuil was awarded the High Environmental Quality Operating Certification
in 2009. In addition, two buildings in Austria received the prestigious “Greenbuilding
Generali Real Estate
€28 billion in property assets, managed by a team 600 operators in 10 countries,
these are the highlights of Generali Real Estate (“GRE”), the new entity that concentrates the Group’s real estate operations at an international
level. GRE is an Italian multinational with a solid international presence considering
that some 60% of its assets are located abroad. Besides Italy, Generali Real Estate
is present in France, Germany, Austria, Spain, Belgium, Netherlands, Switzerland,
Eastern European countries and Asia, with operative structures in the key centres
of each market. Operative as from 1 July 2012, the new entity plans to develop
property management services for third parties as well, aiming to emerge as a
specialised operator for institutional investors in the real estate sector and
setting for itself the ambitious target of reaching € 36 billion in property assets
under management in 2016.
At an organisational level, GRE can rely on a central structure, dedicated to
global strategy, strategic planning and cross-border activity, that coordinates
local units, corresponding to the real estate companies in the various markets.
Generali Real Estate’s business model is based on two areas of specialisation:
asset management activities, focusing on increasing the value of property and developing real estate rotational
programmes, and property-related service activities focusing on the maintaining
and enhancing the efficiency of property under management.
“The Straight, the Crooked and the Curved”: the future of the green building
sector in Milan
Among the Group’s “greenest” projects there is CityLife that, it should be recalled, is Milan’s largest pedestrian area thanks to the
decision to shift circulation and parking lots below ground.
It will be a zero-emission quarter, with no gas heaters or other sources of combustion. The primary energy resource
will be water: with teleheating facilities for the heating and cooling of the towers and the
utilisation of ground source heat pumps for residences. All CityLife buildings
feature high energy performance levels: the photovoltaic panels will significantly
reduce the energy consumption for the functioning of facilities. The ecologic
profile of the area will be closely linked to the creation of a 168,000 sq. m
public park that will integrate with the green areas in the northwest creating
Milan’s most important ecologic network, essential for the depuration of the city’s
air and to achieve urban rebalancing.
But the distinguishing trait of the project is the huge central piazza - hosting
a number of public facilities - on which rise the three office towers named after
the three architects who designed the complex. Citylife Business & Shopping
District will consist of some 130,000 sq. m of office space distributed in the
Isozaki, Hadid and Libeskind, towers, which were designed to ensure optimised
With work on its construction expected to start sometime in 2015, the Isozaki
Tower has been identified as a possible venue to host all Generali Group operations
in Milan, a decision that could cut operating costs by approximately half. The
tower is 202 metres high with 50 floors and a plan layout of 63 m by 27 m, equivalent
to five tennis courts.
The Isozaki Tower – “The Straight” – has already obtained the “Gold” LEED™ pre-certification
after having met all the stringent international environmental sustainability
standards set by the green building rating system. The Hadid Tower, too, has received
the “Gold” LEED™ pre-certification; known as the “The Crooked,” it is 170 m high,
and work on it will start a few months after the construction of the main tower.
As for the 150-metre-high Libeskind Tower, known as “The Curved”, it too has been
designed along similar green building criteria. These pre-certifications confirm
CityLife’s commitment right from the outset to implementing green building design,
construction, operations and maintenance solutions in a bid to create a zero-emission,
ecofriendly, city quarter.
In the last few years Generali has been successful in improving all the environmental
ratings assigned and in joining the principal ESG indexes such as Aspi Eurozone, ESI, FTSE4Good, MSCI ESG and STOXX Sustainability. Generali’s environmental performance connected with climate change mitigation
obtained 80/100 from the Carbon Disclosure Project, scoring 12 points higher than
last year. It is a score that falls short of the ‘excellent’ threshold (85/100).
But if there are only advantages to be had, why shouldn’t all construction be “green”?
Clearly, the utilisation of advanced technologies and construction techniques
is more expensive and requires bigger investments. Yet by sustaining an estimated
initial cost of just 2% more with respect to conventional constructions, the return
on investment during the buildings’ life cycle can be expected to be 10 times
If the exact estimate of just how better the quality of life can be in a “sustainable”
building is still a matter of ongoing debate among scholars and experts, there
is no doubt that regarding several fundamental parameters – such as lighting,
perceived quality of air, room temperatures, safety, space reserved to socialisation,
overall workplace wellbeing workers perceive – working areas within sustainable
buildings seem to offer a better outlook, generating positive consequences in
terms of reduced absenteeism and work-related stress and improved heath.
And the same, of course, could occur in residential construction, confirming,
once again, that it is indeed possible to reconcile housing with social awareness.
In the words of Mr. Scotti, CEO of Generali Real Estate: “GREEN buildings and energy efficiency are key challenges for a real estate managing
company like GRE. The creation of spaces that are environmentally efficient, where
people work, live and meet, is an operative priority for us. We are constantly
seeking the highest environmental standards for our historic building – through
the implementation of measures aimed at safeguarding their heritage status – as
well as our new constructions, which are conceived and designed according to state-of-the
art green technology. Clients’ green awareness is increasing worldwide, and our
commercial success will also depend on our ability to deliver products featuring
top-level environmental efficiency standards.”