What is being done to tackle poor air quality in cities?


 

Why is air pollution an issue and why does it matter?

Combatting air pollution is a major challenge for cities across the globe. According to the World Health Organisation (WHO) 92% of people worldwide live in places where air pollution levels exceed suggested safety limits. Our analysis of the air quality standards in 116 Global Cities reveals that over two thirds exceed WHO guidelines for ambient air quality limits for particulate matter, the hazardous air pollution that inflicts damage to respiratory tracts and lungs. It's not just a developing city problem either. It would probably surprise many people that recent air pollution levels in some areas of London and Stockholm have actually been worse than in Beijing. Poor air quality affects the health and wellbeing of citizens as well as a city's quality of place. Around three million deaths a year are linked to exposure to outdoor air pollution. The majority (90%) of air pollution-related deaths occur in low-and middle-income countries. It is also an issue in more developed countries, with outdoor pollution contributing to about 40,000 early deaths a year in the UK for example. Air pollution is particularly harmful to the most vulnerable populations - children and elderly. It is also an important factor that influences longer-term investment returns. Our analysis of investment returns and air pollution levels in 58 Global Cities in developed markets (US, Europe and Asia) indicates a negative relationship between long-run average total returns and higher annual average air pollution.

What is being done to tackle poor air quality in cities?

Increasingly Mayors, local governments and the private sector recognise the serious problem that air pollution poses for the well-being of citizens and the long-term potential for places. Cars are the biggest air pollutants in cities – 75% of carbon monoxide emissions come from cars and on average car emissions are responsible for 50-90% of urban air pollution. Actions are being taken to improve air quality by banning vehicles (particularly diesels which are the highest emitters of nitrogen oxides) from dense urban cores of cities. Athens, Paris, Madrid and Mexico City have drawn up plans to ban diesels by 2025. Meanwhile the Mayor of London plans to implement the world’s first ultra-low emissions zone, with surcharges for the most polluting cars. In the long-term the further roll out of electric and hydrogen powered vehicles will contribute to improving air quality in cities.

How is the real estate sector responding?

We are beginning to see a shift away from car-oriented development and a focus on more walkable, higher density urban neighbourhoods. In order to combat rising levels of air pollution, cities around the world are implementing plans to go car free, at least in some downtown/core areas. Investors and property developers should prepare for a future where the urban realm is more public transit-oriented and enhancements to walkability and cycling infrastructure will help deter car use in dense urban areas. Research by Real Capital Analytics (RCA) showed that prices for properties in less car-dependent areas have risen 125% over the past decade. Therefore investing in walkability and public transit-oriented development will pay off in the long-run through higher property values and rents – while at the same time contributing to improving air quality and the urban environment.

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