Sea level rise: what we can do now

March 5, 2018 10:58 am

Even where specific properties may be elevated (1), risk may stem from infrastructure (2) or communities (3).

Even where specific properties may be elevated (1), risk may stem from infrastructure (2) or communities (3).

By Charles K. Huyck

Sea level rise will strongly influence real estate investment strategies in the coming decades. Those who understand the nature of the problem will be in the best position to identify risks and mitigate impacts.


Sea level rise will undoubtedly impact coastal communities in the coming decades. Yet, little is being done in the financial and insurance communities to bolster resilience. Much of the debate has centered around how much sea levels will rise, and whether the climate change in general can be attributed to greenhouse gases. Uncertainty about how much sea levels will rise is due to 1) inability to foresee how much future carbon emissions will be curbed, and 2) complexity with regard to how fast the continental ice sheets will melt.  Unfortunately, there is considerable evidence that the ice melting is accelerating, and that sea levels will rise linearly with temperature. The figure below depicts various NOAA scenarios for global sea level rise and can be used as a general indication of what to expect(1). The spread over the next 50 years is significant, leading many to adopt a “wait and see” attitude.

Why act now?

Uncertainty is not an excuse for inaction, however, and is not fiscally prudent. Negative impacts to communities are clearly on the horizon and forward thinkers will be in the best position to reduce future losses through mitigation or diversification. As the national focus eventually adjusts from short-term economic challenges to the impending changes that must be made, those that understand their risk will be best positioned to adapt.

What do we know?

It’s not so uncertain from a modeling standpoint. When assessing the cost-effectiveness of mitigation strategies, the discount rate has a larger impact than whether the sea will rise a little or a lot, and at the current rate many mitigation strategies are highly cost effective. This is true for analysis of building level mitigation(3) or city-level mitigation(2).

Changes will not be gradual. It is tempting to wait to act until the water starts to rise. However, the effects of sea level rise are subject to “tipping-points,” triggered by such events as major storm surge from hurricanes, inundation of or damage to key infrastructure such as ports, highways, or treatment plants, or sudden and widespread real estate liquidation.

The sea is not a bathtub. It is also tempting to observe the tide and assume that most properties have plenty of room to spare. However, data from NOAA stream gauges indicate unequivocally that the sea will not rise evenly- and the impacts will vary significantly not only by city, but within cities. The reasons for uneven sea level rise by locality (known as relative sea level rise), include:

  • Subsidence– some land is sinking under the weight of the water. In Louisiana the ocean is rising 10 mm a year.
  • Uplift– some land is rising as the heavy ice melts. In areas in Alaska, sea level is falling 17 mm a year.
  • Erosion– some areas are more prone to washing away.
  • Coastline geometry– wind, ocean circulation and offshore elevation impact the local tides and circulation of water.
  • Gravity– the distribution of the earth’s weight is changing as the ice caps melt.

There are solutions. In high-value megacities with the right coastal configurations, it is possible to mitigate or adapt to the risk. Many areas such as New York City and Miami have made progress towards identifying solutions2 (see below). It is possible to design buildings that are resistant to flooding and storm surge effects.

But solutions are expensive. It is not clear who will pay for the solutions, and it will take years of political negotiations to structure tax plans and insurance policies to effectively protect real estate. In many cases, solutions will simply not be cost effective, and land reclamation will need to be considered.

Cities are not all the same. Urban risk varies considerably according to the configuration of assets and infrastructure throughout cities with respect to the ocean. Cities with critical infrastructure in low lying areas, such as coastal highways or vulnerable levees will be at greater risk. In addition, not all economies are the same. Regions where the economy is dependent on tourism are likely to experience a downward spiral as recreational assets are submerged.

There will be migration. When it becomes clear that the risk and economic impacts in some communities are insurmountable, people will leave.

What can be done?

Trillions of dollars of assets are at risk, and sea level rise will strongly influence investment strategies on the coasts in the coming decades. There are some things we can do now:

Modeling. Understand the problem through modeling to determine which buildings and market areas are most vulnerable.

Monitor accumulation. With the results of the models, monitor coastal accumulation in high-risk areas. Revise natural hazard due diligence practices to identify properties at risk. First floor /foundation elevation should be tracked for coastal properties and other areas prone to flooding.

Build above code requirements. Determine where changes should be made in the design of new buildings as a part of development projects. It is far cheaper to build higher than mitigate flood risk, for example.

Push for solutions. Determine where financial institutions should advocate change to protect investments through seawalls, zoning regulations and enhanced building codes. Determine where it is feasible to reduce economic losses due to business interruption. Work with professional organizations and political institutions to effect change.

Reduce financial exposure in high risk real estate markets: Diversify risk to reduce accumulation in the most vulnerable market areas. As it becomes clear that tourism and recreation will no longer be feasible in some areas, there will be mass liquidation. Owners may default regardless of whether their specific properties are vulnerable to sea level rise. 



1 Global and regional sea level rise scenarios for the United States, NOAA Technical Report NOS CO-OPS 083, 2017.

2 “Evaluating flood resilience strategies for coastal megacities.” Science 344.6183 (2014): 473-475.

3 Natural Hazard Mitigation Saves 2017 Interim Report: An Independent Study. National Institute of Building Sciences, Washington.

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