30 May 2012 – Perhaps it’s the global view – the constant visits to many countries in search of material for his next book on green buildings, or to give keynote speeches at conferences and inevitable briefings with the world’s green design and investment leaders – that gives Jerry Yudelson such a sanguine outlook.
Either way, this lanky, softly spoken man from Arizona in the US, brings a sense of calm to the view that the anti-climate change political forces are out of control. Or that the green building movement could stall because it’s so dependent on financial sentiment.
None of this is true, he thinks, at least in simplistic terms. Instead there are clear mega-trends that will override the dips and plateaux.
Yudelson, visiting Australia in May as keynote speaker for the recent ARBS exhibition and conference event in Melbourne, took time out for a “salon” dinner with a handful of industry leaders in Sydney, and later, a separate interview with The Fifth Estate.
First, Yudelson is not overly concerned with politics.
Yes, the political outlook is dismal and governments are failing society in many western countries. Fundamentally, he says, there is no social contract for change just about anywhere in the western world.
“All the western democracies have over-promised social benefits and are going to have a very hard time delivering them, which is going to crimp financial aid to other sectors,” he says.
“We can see that in the current [Australian federal] budget, where the money that is going to the so-called battlers is taken out of places where that would go to grow the economy. [And the property industry lost its promised tax breaks to help retrofit older buildings.]
“It’s an even-money trade-off between consumption and investment, and you can’t get both.”
But with green buildings, Yudelson says, we don’t really need government. “The private sector knows what to do,” he says. It’s a bit like the people power of recent democracy movements. It will continue, whatever wind the political leaders bend to.
At the high end of property development, “there is no question” that green building is moving forward at full steam.
“The really smart operators have really all bought in,” Yudelson says.
It’s the laggards that pose the big questions for property, but they too will eventually feel the push of market forces.
“The more interesting question is how we get to the next group of properties – the B, C and D [grade buildings] – to start moving.
“The moment one of these investors loses a tenant or some other major opportunity, they are going to start pushing this stuff and that’s the way it’s been from the beginning.”
In the property industry, he says, “everyone knows each other’s business”.
“There’s the leading edge people – they’re really smart people – and everyone else is looking. It’s like the lions and wilderbeest in those movies; they’re all together and they’re all watching each other.”
Incentives such as tax breaks or even direct funding might jump-start action,but the market dynamics are clear in any case, he says.
Interestingly, in the US, perhaps in contrast to Australia Yudelson says, the leaders are not the listed real estate trusts, but the private, non-institutional owners who are starting down this road.
For instance the biggest owner of buildings rated under the US LEED green building rating system is a “private at-risk company”, and it’s completed 50 LEED-rated refurbishment projects.
“They’ve been doing this for the past few years and everyone is looking at them and saying, I’m as smart as they are, what’s in their water?
“This is not a Dexus, Investa, Stockland or Lend Lease. These are private, committed people who started doing this. Within this group there is an ideological component in that they are initially very committed on sustainability and they look to how to implement that in their chosen field of endeavour.
“They’re saying, we have the skills here. What we need is a mindset.”
The young leaders
Yudelson says it’s the next generation that is leading a more ethical framework.
“In a lot of these private firms it’s the next generation, like Daniel Grollo [who recently took over full control of the family development company, Grocon], it’s the next generation who come in … and want to make their mark.
“That’s the direction they’re going in.”
In the US Yudelson says the global financial crisis put a three-year hold on projects, but now many are moving ahead. And he doesn’t think the global financial crisis will be repeated.
“There is no way that governments are going to let the private sector get that out-of-control again.”
Yudelson doesn’t think the green movement will go backwards; he thinks it’s more a case that people have “hit a plateau for a while until they can see the landscape.”
Money is not the problem. “US corporates have US$2 trillion in cash on the sidelines and they’re waiting to see the direction of things before making investments.”
Yudelson is also unconcerned about the political backlash on climate change issues.
A key problem, he says, is that the debate has been taken over by the left and the environmental left and people on the other side of the political fence see little option beyond opposition to the core issue their opponents identify with.
“What’s [opposition leader] Tony Abbott to do if he wants to get back into power?”
Another problem is that climate change is a very slow process and it’s hard to sell the public on something they can’t see or feel in the short-term, he says.
“People are deeply sceptical of government and the veracity of what they say.”
And the climate change lobby has been proposing fairly extreme policy measures to a problem that is not obvious to a lot of people.
Such as that Florida was going to disappear. “One metre of water rise isn’t going to make Florida disappear,” Yudelson says.
But he points out that the evidence of climate change keeps mounting and it’s the young – many with “great heart” – who will bear the brunt.
The big question is, will they get the support from their elders?
In his youth, during his own campaigning years – against over-population, the depleting ozone layer, pollution – “there were a lot of elders cheering us on,” Yudelson says. “We still had to do the heavy lifting.
Yudelson thinks filmmaker James Cameron’s Avatar hit the nail on the head. The issue of resource depletion is immediate and threatening and far easier to see than climate change.
“I actually think he was onto the real issue [of resource depletion]. And that’s a paradigm shift: whether we are prepared to reduce our claims on the environment in order to preserve long-term sustainability.
“And that is the kind of thinking that is happening in this fast-moving world and it goes far beyond the science of climate change, and has to do with our fundamental values.”
In the early 1900s, he says, there were 1.6 billion people on the planet. We are now at 7 billion.
“There is no way you can provide for those people with the same system. You can try to learn from the Aboriginal culture about respect for humanity and nature, and respect for the environment.
“It’s a spiritual desert we are in right now. We have fundamentally lost respect; we fundamentally think we are superior.
“And that’s fundamentally where the cultural shift of young people has to lead.”