Sustainable homes designed to reduce the overall environmental impact are typically heralded in terms of saving the planet. But can healthier homes offer more immediate benefits, too? Piet Eichholtz, professor of real estate finance at Maastricht University’s School of Business and Economics, studies not only the financial benefits of green buildings, but the possibility that healthier homes can make us more productive, too. His findings are the subject of his 2018 UM Star Lecture, “Healthy buildings and human performance: Sustainability 2.0”.
“There are some academics who take the role of preachers when it comes to sustainability, who just reiterate that we must be sustainable,” Eichholtz observes. “We take a more pragmatic approach and say, well, let’s see if sustainability pays, in monetary terms. Because if it does that, you don’t need to be a preacher, you don’t need to have government rules – the market will provide incentives.”
Good for business, good for people
Eichholtz began to look into the impact of real estate on CO2 levels, and the bottom-line benefits of sustainability, over a decade ago.
“We found that the market does provide incentives for sustainability,” he says. “Buildings that are more energy-efficient produce higher rents, are better occupied and are valued more highly.” He met with one practitioner who suggested that green buildings are good for human capital, because they increase the occupants’ productivity.
“It sounded plausible,” Eichholtz adds, “but we wanted to be sure. It turns out we know almost nothing about the relationship between healthy buildings and the productivity of the occupants, and we decided that was the next frontier. We call it Sustainability 2.0.”
Back to school
To link sustainable buildings to human productivity, Eichholtz and his fellow researchers needed to find an environment in which the indoor climate can be measured and where people spend long periods being productive.
“We found the solution in elementary schools; it’s the perfect situation,” he comments. “Kids are in the same room for hours each day, and it’s meaningful time. And we follow their performance based on standardised tests. It’s a very meaningful group of people: we know that the most important phase of cognitive development is elementary school.”
Eichholtz and his team are now installing climate sensors in nearly 300 classrooms in the Netherlands and measuring the performance of about 8,000 students.
They are also analysing surveys conducted in several countries and following thousands of households over long periods. “They ask the occupants questions every three months. It’s incredibly detailed,” Eichholtz says. “They ask them about the house, their work, their family, their health. We decided to use this data to get insight into the relationship between housing quality, the maintenance of the home, the ventilation of the home and the health of the occupants. So we don’t know their productivity per se, but we know quite a bit about their health.”
Evolving research interest
Real estate has been the centre of Eichholtz’s research throughout his career, from a variety of angles.
“I’ve been working on real estate stuff for a long time, but my interest has really evolved a lot,” he says. “When I did my PhD at SBE, I was mostly interested in international real estate investment and portfolio management. I then became interested in the history of real estate and created The Herengracht Index, which looks at housing prices going back to the 17th century and covers all the houses on the Herengracht in Amsterdam. I’ve done a lot of work in extending our knowledge of real estate markets to the late medieval times.”
Eichholtz expects his current research to have a clear impact on how sustainability in real estate is perceived. “This is all completely new. It seems such an evident subject of research that you’d expect someone to have already done it. But nobody has. We are the first,” he says of the work he conducts with his SBE colleagues.
“Once the research is out there, there will be a lot of pressure on homeowners and landlords to do something about it. We think that in about five to ten years’ time the health of a home will be a key selling point.”
Prime insights from a prime minister
What of his own office at SBE? It’s good for productivity, he confirms, and well set up for encouraging close contact with his colleagues.
“There’s a famous saying by Winston Churchill: ‘We shape our buildings, and then our buildings shape us’,” Eichholtz says. After the Second World War bombing of the chamber of Britain’s House of Commons, many parliamentarians wanted to replace the original building with a grander, larger one, but Churchill, the Prime Minister, refused.
“He said they would rebuild it as it was, because the very fact that they didn’t have much space and could look at each others’ eyes across the aisle is what made that democracy so vibrant,” Eichholtz adds. “And it holds very much for SBE as well. I think our building is very inspiring, and I’m a happy trooper here. Sharing is key. The key success of humanity versus any other animal is cooperation. If we had to do stuff alone, we would be just as unsuccessful as house cats.”
Alumni around the world
On the subject of sharing, what are Eichholtz’s thoughts on the Maastricht University alumni who will share the room with him during his 1 February lecture?
“I keep contact with a lot of former students, especially from long ago, and I bump into many of them at conferences,” he says. “I’ve always given some reading advice at the end of my lectures; just books I happen to be reading at that moment. Some of my former students still write me now and again to tell me what they are reading, and ask for recommendations, which is really cool. I get to see where they end up… and many of them are globally successful.”
Text: Tracy Brown Hamilton