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Does Sustainability Affect Real Estate Market Values? Empirical Evidence from the Office Buildings Market in Milan (Italy)


  • Alessia Mangialardo

    (Department of Architecture and Arts, IUAV University of Venice, 2206I-30123 Dorsoduro, Italy)

  • Ezio Micelli

    (Department of Architecture and Arts, IUAV University of Venice, 2206I-30123 Dorsoduro, Italy)

  • Federica Saccani

    (Building Consultancy & Sustainability, CBRE, Piazza degli Affari 2, 20123 Milan, Italy)


The construction industry is the world’s largest consumer of energy and producer of greenhouse gases. For this reason, there is a broad debate on how to make the built environment more sustainable. Although the positive externalities of energy-efficient retrofitting and new construction are known, the economic effects that green building has on the real estate sector in Italy are less evident. The aim of this paper is to analyze the Italian real estate market to investigate if, and to what extent, demand appreciates the supply of green real estate assets. The research focused on the analysis of 55 development projects of office buildings (with and without environmental certification) located in Milan, at present the most dynamic and flourishing real estate market in Italy. Through these case studies the authors investigated the premium price that is generated in certified real estate development projects. The results highlight a premium price, especially for high levels of sustainability. Similarly, the rate of absorption of certified assets reflects a preference for green properties, which are absorbed by the real estate market in less than half of the time foreseen for real estate without an environmental certification.

Suggested Citation

  • Alessia Mangialardo & Ezio Micelli & Federica Saccani, 2018. "Does Sustainability Affect Real Estate Market Values? Empirical Evidence from the Office Buildings Market in Milan (Italy)," Sustainability, MDPI, vol. 11(1), pages 1-14, December.
  • Handle: RePEc:gam:jsusta:v:11:y:2018:i:1:p:12-:d:191986

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    References listed on IDEAS

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    Cited by:

    1. Alessia Mangialardo & Ezio Micelli, 2020. "Reconstruction or Reuse? How Real Estate Values and Planning Choices Impact Urban Redevelopment," Sustainability, MDPI, vol. 12(10), pages 1-15, May.
    2. Prescott C. Ensign & Shawn Roy & Tom Brzustowski, 2021. "Decisions by Key Office Building Stakeholders to Build or Retrofit Green in Toronto’s Urban Core," Sustainability, MDPI, vol. 13(12), pages 1-31, June.
    3. Francesca Abastante & Isabella M. Lami & Marika Gaballo, 2021. "Pursuing the SDG11 Targets: The Role of the Sustainability Protocols," Sustainability, MDPI, vol. 13(7), pages 1-19, March.
    4. Wenqin Gong & Yu Kong, 2022. "Nonlinear Influence of Chinese Real Estate Development on Environmental Pollution: New Evidence from Spatial Econometric Model," IJERPH, MDPI, vol. 19(1), pages 1, January.
    5. Hui-Ching Hsieh & Viona Claresta & Thi Minh Ngoc Bui, 2020. "Green Building, Cost of Equity Capital and Corporate Governance: Evidence from US Real Estate Investment Trusts," Sustainability, MDPI, vol. 12(9), pages 1-21, May.
    6. Adriano Bisello, 2020. "Assessing Multiple Benefits of Housing Regeneration and Smart City Development: The European Project SINFONIA," Sustainability, MDPI, vol. 12(19), pages 1-28, September.
    7. Timo Gerres & Manuel Haussner & Karsten Neuhoff & Alice Pirlot, 2019. "Can Governments Ban Materials with Large Carbon Footprint? Legal and Administrative Assessment of Product Carbon Requirements," Discussion Papers of DIW Berlin 1834, DIW Berlin, German Institute for Economic Research.
    8. Ioannis Vardopoulos & Ioannis Vannas & George Xydis & Constantinos Vassiliades, 2023. "Homeowners’ Perceptions of Renewable Energy and Market Value of Sustainable Buildings," Energies, MDPI, vol. 16(10), pages 1-18, May.
    9. Paolo Bragolusi & Chiara D’Alpaos, 2021. "The Willingness to Pay for Residential PV Plants in Italy: A Discrete Choice Experiment," Sustainability, MDPI, vol. 13(19), pages 1, September.
    10. Giuliano Marella & Valentina Antoniucci, 2019. "Time Overrun in Public Works—Evidence from North-East Italy," Sustainability, MDPI, vol. 11(24), pages 1-17, December.
    11. Sean Hay Kim & Jungmin Nam, 2020. "Can Both the Economic Value and Energy Performance of Small- and Mid-Sized Buildings Be Satisfied? Development of a Design Expert System in the Context of Korea," Sustainability, MDPI, vol. 12(12), pages 1-29, June.

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