Sustainability reporting requirements for the UK real estate sector

Sustainability reporting in the UK is changing quickly. New rules are being introduced to give investors, customers, and the public clearer and more reliable information about how businesses are responding to climate change.

The government has now finalised the UK Sustainability Reporting Standards (UK SRS), which will bring sustainability information directly into financial statements and create a simpler and more consistent reporting framework. 

While these changes begin with listed companies, attention is now turning to “economically significant” private businesses, including those in real estate, construction, property management, and related services. The government has made clear that meaningful sustainability reporting should apply to all organisations that play a major role in the economy, not just listed ones. 

More businesses will need to report in the future

The government has indicated that UK SRS may extend to private companies in the coming years. This matters for the real estate sector because many major developers, investors, and operators are privately owned. Extending the standards would make reporting more consistent across the market, and larger companies will increasingly look to their suppliers for better sustainability information. 

A clearer timeline for big companies, and what it means for everyone else

The Financial Conduct Authority (FCA) has recently closed a consultation on applying the new standards to listed companies for accounting periods beginning on or after 1 January 2027. Although these rules will apply to listed businesses first, they will create a ripple effect throughout the supply chain. Real estate firms that provide services to listed companies will likely receive more structured and frequent requests for information, especially related to energy use, emissions, and climate risks. 

For smaller organisations, this means that even if reporting is not yet a legal requirement, clients and partners will expect clearer and more reliable information. It is also being suggested that private companies may come into scope a year later, meaning reporting could begin for them from 2028. 

The FCA is also consulting on assurance

At the same time, the FCA is exploring how assurance should apply to sustainability information in the future. This could result in sustainability disclosures being reviewed with the same level of scrutiny as financial information. If this happens, organisations will need strong systems, good records, and clear audit trails so their information can be verified. This would raise expectations around accuracy and reliability, and it reinforces the importance of preparing early. 

SECR rules are not changing

There has been some confusion about whether changes to UK company size thresholds affect the existing Streamlined Energy and Carbon Reporting (SECR) rules. They do not. SECR still applies to companies meeting any two of the following criteria: 

• £36 million turnover 
• £18 million balance sheet 
• 250 employees. 

These rules remain in place to ensure that more organisations measure and report their emissions, which helps larger companies improve the accuracy of their supply chain carbon reporting. Many real estate businesses already meet these thresholds due to their size and operations. Exemptions do exist, but they need to be assessed individually.

What this means for the real estate sector

1. Climate risks need to be understood

Flood risk, overheating, rising insurance costs, and the cost of improving building energy performance are some examples of climate risk. They will need clearer explanation by suppliers and reporting organisations. 

2. Better carbon data will be needed

Understanding the carbon used during construction, often called embodied carbon, and the energy used once buildings are occupied will be essential for winning work and accessing finance. 

3. Supply chains matter more than ever

Lenders, investors, and major clients will favour real estate businesses that understand their emissions and can show how they are reducing them. 

The most effective approach is to begin planning early. Improving data collection and building internal understanding step by step will help avoid last minute pressure and will position your organisation as a reliable partner in a market where sustainability expectations continue to rise. 

If you would like to speak to one of our experts about Sustainability Reporting, please do get in touch.