Climate change.

A change in global or regional climate patterns, in particular a change apparent from the mid- to late-20th century attributed largely to the increased levels of atmospheric carbon dioxide produced by the use of fossil fuels.

Urban resilience.

The measurable ability of any urban system, with its inhabitants, to maintain continuity through all shocks and stresses, while positively adapting and transforming towards sustainability.

As we look towards the future of our communities, we try to anticipate the impending and developing needs, minimizing the negative effects while taking advantage of the positive effects of coming events. Future-proofing is a term that has quickly come to describe our bigger vision that incorporates resilience, sustainable design, life-cycle analysis, and addresses the present and future needs of the built environment.

ULI Arizona’s April Main Program, “Future-Proofing Your Returns: Climate Risk and Your Bottom Line,” tackled the issue of extreme weather events and climate change from the perspective of global investors and how they can hedge against their portfolios being affected.

Around the world, climate change is a hot topic … no pun intended.

“One of the things we all need is money. Global investors are starting to look at global weather events when factoring in decisions to lend money to or to invest in,” said moderator Billy Grayson, Executive Director, Center for Sustainability and Economic Performance, Urban Land Institute.

Joining Grayson on the panel were Kevin Bates, President/CEO, Sharp Development; Ryan Ferguson, LEED AP, DPR Construction; Laura Hyneman RA, LEED AP, Deputy Director, Environmental and Sustainability, City of Mesa; and Ladd Keith, Chair, Sustainable Built Environments Program, University of Arizona.

Recent research has shown that the impact of real and perceived risks of climate change are already beginning to be reflected in pricing of residential real estate. Commercial real estate may be next. Developers, communities and investors are factoring climate risk into their decision-making and management processes.

“The 30 biggest capital lenders are seeing the transitional risks,” Grayson said. “They’re seeing questions like ‘what is my building going to be worth in 10, 15 or 20 years?’ being asked. What is my future buyer going to look like?’ There are long-term weather risks and the market is not pricing these risks.”

ULI is working hard to develop urban resilience, Grayson said. It’s taking a hard approach against physical risks while softening to not affect the environment negatively. A major resilient strategy, Grayson said, is insurance.

While Grayson gave a more global look, Keith zoomed in on what is happening in Arizona.

“Drought. Flooding. Wildfires. Heat. Arizona has been dealing with all these since we built the cities here,” Keith said. “And it’s getting much worse. It’s going to continue to get hotter. We have been in a drought for 20 years. It will be a more pressing issue in the future. With warming temperatures, the snow melt is happening a lot sooner.”

“Flooding, we’re poised for it in the Southwest as more extreme rain events happen. Monsoon patterns are changing. Projections in 50 years show more rain in the mountains than in the urban areas,” Keith said.

Even Arizona’s wildfires will get worse. “As we saw in California, the wildfire season is now a year-round thing. It could impact water and air quality issues. That smoke can travel for thousands of miles,” he said.

A sobering number Keith laid out: 114 degrees. That could be the average summer temperature in Phoenix by the year 2100.

Hyneman said Mesa is investing in its urban core.

“Developers are coming with projects that address the urban, walkable mixed-use, landscape-focused approach. The focus is that of bringing forward quality projects that are going to be conducive to that environment. Quality land use and planning: green infrastructure,” she said.

For DPR, it’s all about green infrastructure, Ferguson said.

“Green infrastructure retains any rain water on site. It allows us to put in additional shade in parks and transportation projects. More green infrastructure in the public zone.”

The mission statement of California-based Sharp Development is to create “carbon neutral, net zero energy buildings emphasizing the health and wellness of its occupants.”

“We’re doing this right now,” Bates said. “By creating super energy-efficient buildings, we can help mitigate the heat island effect. It’s all about sustainability.”