In a world where buildings account for nearly 40% of global carbon emissions, the commercial real estate sector can no longer afford to sideline sustainability. And as pressures mount from regulators, investors, and tenants, it’s clear the industry doesn’t just need sustainability. It demands strategic leadership. Heather Hall, a fractional CFO and founder of Sapphire CFO Solutions, believes the next generation of financial leadership in real estate must be deeply fluent in ESG.
“You’re doing your clients a disservice if you don’t understand that ESG is a central driver of enterprise value in real estate,” Hall says. “From cost savings and higher rents to lower financing costs and better brand positioning, sustainable real estate is high-value real estate.” A cross-functional C-level leader with more than 30 years in finance, Hall is at the forefront of redefining what it means to be a CFO in today’s climate-aware economy.
Historically, ESG initiatives in U.S. real estate were voluntary or market-driven. But that’s changing quickly. Major cities like New York and Los Angeles are implementing energy benchmarking and emission caps, while institutional investors are demanding ESG disclosures at a much higher rate. Over the past few years, there’s been a 40% increase in ESG reporting among the top 100 public REITs in North America.
The reason is that ESG is good economics. Retrofitting the Empire State Building, for instance, led to a 40% reduction in energy usage and over $4 million in annual savings. LEED-certified buildings report, on average, 20% lower maintenance costs, and they command higher rents, lower vacancies, and better financing terms.
“You get enhanced property income, higher asset values, and reduced cost of capital,” says Hall. “And in a capital-intensive industry like real estate, that’s truly transformative.”
This value shift requires a new kind of financial leader, one who not only understands EBITDA and cash flow but also ESG metrics, frameworks, and platforms.
Hall says the role of a modern CFO in real estate goes far beyond spreadsheets. It includes understanding green building certifications, navigating sustainability-linked loans and green bonds, and leveraging platforms like GRESB, the global ESG reporting standard for real estate portfolios. “If you’re not leveraging these tools, you’re falling behind,” Hall explains. “Specialized software can pull data from building systems in real time, identify inefficiencies, and automate ESG reporting.”
Hall’s work with Third Economy and its fintech spin-off VIAlab has also helped her recognize the risks of greenwashing and the necessity of measurable, verifiable ESG performance. VIAlab’s proprietary score matrix, for example, uses AI to analyze six ESG-financial integration metrics and flag discrepancies between stated policies and actual implementation. “A lot of companies say the right things,” she says. “But platforms like these expose whether or not they walk the talk.”
While ESG frameworks are technical, Hall sees her role as translating these complex metrics into strategic action, building financial models that reflect not just sustainability targets, but the pathways to meet them. “At the end of the day, ESG should be embedded in performance forecasting, strategic modeling, and value creation,” she says. “You can’t treat it as an afterthought anymore.”
Hall’s own continuing education reflects that approach. She recently completed a certificate in Financial Planning & Analysis from The Wharton School of Business, where she focused on performance modeling, forecasting, and even how to responsibly use AI in finance. “You don’t need to reinvent the wheel, but you do need to evolve,” she says. “As CFOs, we must be innovative and current.”
With rising investor scrutiny, shifting regulations, and clear financial upside, ESG fluency is quickly becoming a competitive edge in real estate. According to a study, green-certified assets carry up to 21% higher market value than non-green counterparts. Occupancy rates are higher, tenant turnover is lower, and access to capital is easier and cheaper.
“This isn’t a niche concern anymore but a fundamental business driver. If you’re fundraising, sustainable practices can reduce your borrowing costs. If you’re operating, ESG improves your margins. If you’re exiting, green buildings command better valuations. The benefits are undeniable,” she states. As Hall sees it, ESG has become inseparable from enterprise value, and real estate firms that fail to adapt will lose out to more forward-thinking competitors.
Looking ahead, Hall predicts increased competition in the ESG tech space, especially from new entrants offering tailored platforms for real estate. “The big players have a lead for now, but smaller startups are entering with sharper, more focused offerings,” she affirms. “That competition will raise the bar for everyone: better features, better integration, better results.”
