Colliers: Climate risk now a major threat to property in EMEA

Colliers warns that climate risk now poses a significant threat to the long-term viability of buildings across Europe, the Middle East, and Africa (EMEA).

Sam Addison

This is due to more frequent extreme weather, increasing regulations, and greater scrutiny from stakeholders, all of which are changing how real estate performs and endures.

According to Colliers' report, "Building Resilience: 5 Megatrends Redefining Corporate Real Estate," climate risk is one of five major trends shaping corporate real estate strategy. The report highlights two key forces: the growing physical impact of extreme weather and rising pressure from regulations and stakeholders to act. Both of these are challenging the future of many existing buildings.

Many organisations in EMEA are not prepared, the report states. Despite knowing about risks like heat, flooding, and environmental disruption, climate risk is often seen as just a sustainability issue, rather than being built into core decisions about location, leases, and capital planning. Leaders are often waiting to see what happens.

This inaction has serious consequences. New environmental regulations could make many buildings obsolete in the coming years if no action is taken. Additionally, changing climate patterns are making previously safe locations riskier.

The report emphasises the need to incorporate climate knowledge and resilience into daily decisions, making physical risk awareness a part of real estate, facilities, finance, and operations.

For real estate decision-makers, the advice is clear: treat climate risk as a core strategic factor. This means conducting structured assessments of location and asset vulnerability and having clear strategies for retrofitting, relocating, or selling properties where risks cannot be effectively reduced.

The research also points to opportunities with new technologies, materials, and designs. Nature-based solutions, like landscaping for temperature reduction or water management, are becoming popular as cost-effective ways to reduce exposure while improving the work environment.

Sam Addison, head of Project Management, EMEA at Colliers, commented: “While progress on decarbonisation is encouraging, there remains a significant gap in recognising how physical risks such as flooding and extreme heat can affect buildings, supply chains and the people within them. Over the next five years, these risks could become critical. Organisations should not be signing leases without understanding the climate risk profile of the asset. A risk-based approach helps prioritise capex, inform portfolio strategy and avoid locking into assets that will underperform.”