From Brown to Prime: Evidence That Gets Refurbishment Funded

Capital is there, if you can prove the case

Investors and lenders are more selective than ever about where they commit capital. Whether it is a new development or the refurbishment of an existing asset, they want clear evidence that a scheme will perform over the long term, not just on day one.

At the same time, asset managers are spending more on refurbishing and decarbonising buildings, even as transaction volumes stay subdued. The question is no longer whether to invest in performance. It is how to invest well, and how to prove it to an investment committee.

Our whitepaper, The Delivery Gap, shows why that proof matters. Drawing on GRESB 2025 data, it found that 81.5% of real estate entities now have ESG policies, yet like-for-like greenhouse gas emissions fell by just 0.23% in 2025. The industry has no shortage of targets. What it lacks is delivery, and capital markets are starting to price that in.

The driving forces for sustainable expenditure

Three forces are pushing asset managers to commit more capex to their buildings:

• Regulation. The UK’s Minimum Energy Efficiency Standards (MEES), France’s Décret Tertiaire and wider regulatory requirements put a hard floor under building performance. Assets that fall below it become harder to let, finance and sell.
• Investor pressure. LPs and lenders expect credible decarbonisation plans, backed by data rather than intent.
• Fund strategy. Value-add fund structures are growing in popularity, and their whole thesis rests on upgrading assets.

The value-add opportunity and its risk

Higher interest rates have changed the maths for real estate investors. LPs need a real premium to justify tying up capital in illiquid property, and that is steering them towards value-add strategies. GPs are responding by launching more of these funds.

The play is straightforward. Buy repriced “brown” assets, then upgrade them to meet strong occupier demand for prime, energy-efficient space. Done well, that delivers the return differentiation LPs are looking for. In The Delivery Gap, we call this the brown-to-green arbitrage: assets facing misalignment are increasingly trading at a discount that often exceeds the cost of well-executed remediation.

Done badly, it destroys value. Over-specify and the capex never pays back. Under-specify and the asset is stranded again within a few years. The upside only holds if the upgrade is carefully measured and planned from the start.

Design-stage credentials are no shortcut either. Our analysis of more than 2,000 assets found no statistically meaningful link between EPC rating and actual operational energy intensity. The whitepaper also describes a 2020 residential tower, rated BREEAM Excellent, that will breach its CRREM carbon limit by 2036, carrying an estimated £2.8 million heat pump retrofit liability that appears nowhere on the balance sheet. Credible business plans have to be built on how buildings actually perform.

How the Deepki ecosystem adds value, from strategy to delivery

Bringing together EVORA’s consulting expertise and Deepki’s real estate sustainability platform provides investors with the insights needed at every stage of the asset lifecycle.

1. Set the right target

We identify the performance level each asset needs to reach to stay aligned with CRREM pathways and regulation. That target anchors the business plan, so capex is sized to the risk rather than guessed.

2. Plan how to get there, and what it costs

We set out the interventions required, what they cost and what the payback looks like. This can be done as forward planning for a new acquisition or refurbishment, or as a retrospective review of an existing programme.

3. Give the investment committee a decision-ready case

The output is built for investment committees. It supports development and refurbishment sign-offs, and it informs acquisition pricing by making the cost of bringing an asset up to standard explicit before the deal is struck. Where it helps, we apply a shadow carbon price to emissions above pathway to calculate a Carbon-Adjusted NOI, the approach set out in The Delivery Gap. That shows the committee either defended value or a clear divestment signal.

4. See the whole carbon picture

Operational carbon is only half the story. Through Nooco, a Deepki solution, we can now incorporate embodied carbon, so clients see the full impact of a refurbishment against the alternatives.

5. Monitor, verify and certify

Once works are under way, we monitor and verify progress against the plan, drawing on asset-level performance metrics from the Deepki platform. That track record, together with support on green building certification, gives lenders and future buyers the independent evidence they increasingly ask for.

Over time, these insights also build something the market lacks: an evidence base showing how much is really being invested in refurbishment, and what it delivers.

The biggest gains come from starting early

Too often, sustainability advisers are brought in after the key decisions are already half-made. By then the price is agreed, the specification is set and the budget is fixed. The best anyone can do is optimise around the edges.

The real value lies upstream. When sustainability evidence shapes the acquisition price, the business plan and the refurbishment scope, it protects returns rather than just reporting on them. That is why we aim to sit alongside fund and asset decision-makers from the outset and stay embedded in fund operations through to exit.

Timing matters inside the hold period too. As the whitepaper sets out, the lowest-cost intervention is usually one built into a decision already being made, such as a lease event, a plant replacement or a compliance deadline. A like-for-like HVAC swap is a missed opportunity. The same capital, specified with a decarbonisation lens, can deliver compliance, lower running costs and a stronger market position.

Talk to us before the investment committee does

Whether you are launching a value-add fund, underwriting a brown-to-green acquisition or reviewing a refurbishment programme already in flight, Deepki—combining market-leading real estate technology with EVORA’s sustainability consultancy—can help you build the evidence that gets capital committed.

For the full analysis, download our whitepaper, The Delivery Gap: Why Real Estate’s “Paper Targets” Are Becoming a Pricing Risk. Then get in touch to discuss how we can support your next investment decision.