Responsible Investment

Commercial property sector improves energy efficiency

September 13, 2011
Image courtesy of GRESB Foundation

More than 340 property funds and companies, with real estate assets worth nearly 1 trillion US$, have responded to a call for action by the GRESB Foundation, to disclose information on environmental management and performance. The results show that the respondents used energy worth 5 billion US$ in 2010, or the equivalent of about 34 million metric tons in estimated carbon emissions. On average, the funds consumed one percent less energy in 2010 compared to the year before, with Europe trailing Australia and the United States. Environmental leaders, dubbed ‘Green Stars’, reduced energy consumption by as much as three percent.

Investors push for more transparency

Dutch pension giant APG is one of the driving forces behind the initiative. Angelien Kemna, CIO, comments: “The data provided by the GRESB Foundation now forms an integral part of APG’s investment process, assisting us in the due diligence process of new real estate investments and in engaging with our existing property investments. Ultimately, this should reduce the environmental impact of APG’s real estate investments and improve the financial risk-return profile of our investments. The ever louder demands from policy makers to reduce emissions will increasingly affect the way the property sector operates”.

PGGM, a leading Dutch pension fund administrator with origins in the care and welfare sector, is the other founding partner of GRESB. Jac Kragt, CIO, comments: “GRESB is the first and only ESG performance benchmark that covers both private and listed real estate, on a global scale. ‘Sustainability pays off’ is one of our investment beliefs. As a responsible investor we have integrated sustainability into our investment process. As a global investor in both private and listed real estate it is important to us and our clients to be able to benchmark ESG performance and compare between funds, companies, regions and listed and private real estate”.

Reporting on environmental metrics improved

According to Nils Kok, Executive Director of the GRESB Foundation, disclosure of environmental performance is improving rapidly in the global property sector, but there is still a long way to go. “More efficient use of energy and other resources by the real estate sector can structurally reduce energy demand. But the data shows that the most fund managers in the commercial property sector are just at the beginning of full integration of environmental management in daily operations. Reporting on energy, carbon, water and waste is still not common.”

References

This article is based on the press release that was sent out by the GRESB Foundation. More information on GRESB can be found at www.gresb.com.

This article may be reproduced according to our terms of use with attribution (and link, if online) to www.tias.edu. To be cited as: “Commercial property sector improves energy efficiency”, www.tias.edu, September 13, 2011.

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GRESB-Report-20112
GRESB Report 2011
Website GRESB

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