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Which Cities' Real Estate Is Best Placed to Deal With Extreme Heat?

Savills Heat Resilience Index Identifies Global Markets Most Adapted to Hot Weather
CoStar News
July 29, 2024 | 12:54 P.M.

Helsinki, Copenhagen and Stockholm have placed as the top three cities in Savills' Heat Resilience Index, which reviews the places best prepared to deal with extreme urban heat.

Produced as part of its Impacts global research, the Savills Heat Resilience Index looks at 30 global cities. The Index reveals that half of the top 10 ranked cities are in Europe, but even these cities may face risk as heatwaves are especially dangerous in places where buildings are not designed for extreme temperatures.

Conversely, cities that regularly experience days over 30°C (86°F) may be more adapted to hot weather, through extensive use of air conditioning. Savills says access to this and other heat-mitigation measures could be limited by social inequality.

Chris Cummings, director, Savills Earth, says that urban heat should be considered by authorities when planning large regeneration schemes, especially where they involve densifying as this can intensify urban heat, and it is existing local communities that may be affected most. "Higher land values facing parks and water bodies often result in a concentration of taller buildings. This can form a ‘wall’ effect, hindering the dissipation of cooler air deeper into the urban environment. The solution lies in having a mix of building heights and permeability in the streetscape.”

Paul Tostevin, director, World Research at Savills, adds that cities are taking action by appointing heat officers, redesigning public reals, greening urban areas and promoting energy-efficient building codes but he says there is more to do.

"Excessive heat exacerbates air pollution, brings greater risk of wildfire and heightens the risk of flooding, undermining the attractiveness of a city to live, work and play, and as a place for investment and business expansion. Owners of real estate assets face two specific heat risks: transitional risk, ensuring assets can be adapted to manage climate change and energy use aligns with future legislation; and physical risk, as excessive heat can physically damage building materials, so a higher level of structural resilience is required. Ignoring either may lead to reduced values, and at worst, stranded assets.”

The Savills City Heat Resilience Index assesses 30 global cities based on their risk of extreme heat and resilience to it. The Index takes into account a city’s record temperature high, the difference between that and its average summer high, and the numbers of days it experienced temperatures over 30°C in 2023.

It sets that against the city’s Savills Resilient Cities ESG score, which tracks a city’s environmental practices, social policies and governance. Higher-scoring cities should be better prepared to deal with the physical risks of extreme heat and the impact on their inhabitants, Savills says.