Energy availability, reliability becoming defining factors in commercial real estate: JLL report
Energy availability and energy security are becoming key factors in commercial real estate (CRE) decision-making, according to JLL. This trend has critical implications for project viability, property values, and building performance.
“Energy disruptions are becoming a widespread business reality across sectors such as data centers, advanced manufacturing, and life sciences,” said Josephine Tucker, JLL head of energy advisory and sustainability, Americas.
“Tenants are demonstrating clear willingness to pay higher rents for properties with dependable energy systems and we’re already seeing measurable power premiums — 49% in some cases. The classic real estate priorities are evolving from purely location-based to include energy resilience as equally critical factors.”
JLL identifies four structural forces disrupting the energy sector and the traditional role of CRE:
- Electrification and accelerated load growth
- Physical and process-oriented grid constraints creating development bottlenecks
- Decarbonization and clean power deployment
- Digitalization and decentralization of energy systems
Electricity demand is rising after decades of stagnation, driven by AI, data centers, onshoring and reshoring, advanced manufacturing, automation, and EV charging, JLL says. The demand surge is colliding with grid infrastructure designed for slower, more predictable growth.
The electricity system is evolving from a linear chain of centralized generation through transmission networks to end users toward a more decentralized network where energy is increasingly generated, stored, and managed closer to where it is consumed.