The real estate sector in Canada is at a pivotal moment. As environmental, social and governance (ESG) considerations take centre stage, what was once seen as a trend has evolved into a key driver of long-term asset value and investment potential.
With Canada consistently excelling in global ESG benchmarks like the Global Real Estate Sustainability Benchmark (GRESB)®, investors, property managers and tenants alike are demanding higher standards of sustainability.
Energy impact best practices
To effectively measure and manage ESG performance, GRESB® offers a comprehensive global benchmarking and reporting framework for property companies, REITs, funds and developers. More than 2,200 real estate companies, collectively representing USD $7 trillion in assets, used GRESB data and analytical tools in 2024. Their annual assessment gives real estate businesses a competitive edge in a market where investors demand transparency and accountability.
In provinces like Quebec, Ontario and British Columbia, where ENERGY STAR® reporting compliance is mandated, ESG is a non-negotiable requirement. Earning the ENERGY STAR® certification can create advantages such as using, on average, 35 percent less energy and producing 35 percent fewer greenhouse emissions compared to similar buildings, as well as securing better loan terms and interest rates.
As discussions continue in other provinces, similar mandates are likely to become the norm across the country, further solidifying ESG as a critical focus for property management in Canada. Properties that integrate technology into their ESG strategies can achieve high performance in these areas and often demonstrate increased market valuation and greater investor confidence.
Conquering data complexity with technology
As ESG requirements become more stringent, the challenge of collecting and managing the necessary data grows. Real estate investors are incorporating ESG criteria into their investment decisions and require real-time insights into the energy performance of their portfolios. For property managers, this means finding smarter, more efficient ways to track energy consumption and meet regulatory requirements.
This is where technology becomes a lifeline. Specifically, software that automates green energy procurement, 100% whole-building energy, water and waste data aggregation and ENERGY STAR® and GRESB reporting. This minimizes errors and financial losses associated with utility bill validation and data submission for ENERGY STAR® certification and GRESB reports, leading to tangible process improvements, increased cost recoveries and more sustainable operations.
Laying the foundation for energy management
To begin a successful energy management upgrade, invest in invoice automation to reduce manual effort in the accounts payable process and electronic procurement to centralize spending. Consider additional investments in work order apps for facilities, one-stop vendor management and automated payments. An incremental approach, rather than a drastic overhaul, can achieve significant results with minimal disruption. This software-driven operational strategy can yield 10-20 percent savings across your portfolio with low upfront costs and no tenant disruption.
Understanding and documenting energy consumption across your portfolio would be your second step. Start with installing real-time metering to collect and flag abnormal energy usage and implement utility expense management solutions to analyze and gain insights from utility bills. By monitoring consumption and automating utility bill validation and handling exceptions, you can eliminate time-consuming manual tasks, reduce late fees and prevent bill errors and overpayments.
Real results with energy management technology
At Yardi, we’ve seen the remarkable impact of energy management technology firsthand. In one of our office buildings, optimizing energy systems led to a 28 percent improvement in energy efficiency — well beyond initial expectations. By implementing real-time metering, automating HVAC systems and fine-tuning energy consumption based on usage patterns, we were able to significantly reduce energy waste. In just a few months, this optimization delivered a 100 percent return on investment and a savings of over $55,000.
A comparison between baseline energy usage and post-optimization data showed a substantial reduction in consumption, demonstrating the power of integrating energy and property data into a single unified system. These savings didn’t just reduce operational costs — they increased asset value and contributed to overall portfolio growth.
Boosting ESG performance through technology
For Canadian real estate professionals, the ability to accurately track the environmental (E) aspect of ESG is crucial. The next wave of building automation will integrate with artificial intelligence (AI) systems, the Internet of Things (IoT) and advanced analytics to enable real-time monitoring and predictive insights. This integration allows operators to leverage algorithms from a single platform to reduce HVAC energy consumption by up to 30 percent, sending temperature, pressure and speed set point adjustment signals to fans, pumps and chillers every 30 seconds.
With real-time HVAC monitoring and automated fault detection alerts, property managers can compare buildings, catch hard-to-find energy waste and maintain operational excellence — all with minimal manual effort and without compromising tenant comfort. The ability to track and act on real-time data means operators can address issues before they become costly problems.
By starting with key energy management tools and expanding over time, real estate businesses can achieve consistent improvements in efficiency, making sustainability more attainable and manageable across any portfolio.
What’s next in energy management?
In a country that leads the Americas in ESG performance, the adoption of advanced energy management technology is not just recommended — it’s essential. Property managers who invest in these tools today will be better equipped to meet regulatory demands, enhance building performance and secure long-term investor confidence.
Ultimately, ESG is becoming the cornerstone of how properties are managed, valued and invested in. By embracing the technology that supports energy and ESG goals, Canadian real estate professionals can build a future where sustainability and profitability go hand in hand, ensuring greater value for investors, tenants and the environment.
For more details, see How ESG Performance Impacts Investment Decisions white paper.