Our free access period ends on the 18th April 2022. To find out about membership to Sustain RE, please contact us.

Gaw Capital Partners has teamed up with Hong Kong utility company CLP Power to boost energy conservation and carbon reduction.

The real estate private equity firm signed a memorandum of understanding with CLP Power Hong Kong and CLPe, the utility company’s sustainability arm.

Energy-saving improvement projects and solar power generation systems have already been installed in a number of shopping centres managed by Gaw Capital and further energy management solutions will be explored, aiming to enhance energy efficiency and drive sustainable development.

Christina Gaw, managing principal, global head of capital markets and co-chair of alternative investments at Gaw Capital, said the MOU represented "a firm commitment of the three companies to continue promoting sustainable development in Hong Kong and other Greater Bay Area cities, striving to create long-term value and returns for all stakeholders, including investors, shareholders and tenants”.

Purpose-built student accommodation (PBSA) and rental residential firm Nido has formed a strategic partnership with ESG technology firm Utopi to reduce the carbon footprint of its assets across its Europe.

Nido will use Utopi's sensors and its data insights platform to monitor the carbon impact of its assets, starting with PBSA assets in Ireland and Denmark (pictured above).

By effectively measuring energy consumption within each building, Utopi estimates a potential reduction in energy use and carbon impact by up to 20% over a three-year period.

Initial results found two assets in the pilot scheme were running at average temperatures above 20°C, which were reduced to below this level by engaging with residents to drive more efficient use of energy.

Darren Gardner, CEO of Nido, said: “We are conscious of our environmental impact as asset operators and helping our residents reduce their carbon footprint is a priority. Our partnership with Utopi recognises that sustainability is linked to residents’ attitudes towards energy consumption and, following measurement and target-setting, we now have the consistent, real-time data we need to journey towards significant reductions in energy use and carbon emissions.”

UK office landlords could save billions in energy bills and cut out millions of tonnes of carbon emissions, competitors in the first CUBE competition demonstrated. 

The annual building energy efficiency contest featured 30 UK office buildings, ranging from brand new to heritage buildings, which saved a total of 6,087 tonnes of carbon and £8 million ($10.3 million) in energy bills across 540,895 sq m of commercial office space.

Similar efficiencies across the 80m sq m UK office market would cut energy bills by £3.8 billion ($4.8 billion) and reduce carbon emissions by three million tonnes.

Mark Bruno, chief ambassador of CUBE, said: “Our goal was to galvanise the industry into taking stronger action. By encouraging participants to adopt the spirit of competition, they strove to reduce the carbon footprint of their commercial buildings, while also coming together to share experiences and successes. The competition’s first year has delivered some impressive results, and we’re delighted that so many big names from across the real estate world jumped at the opportunity.”

Awards were presented this week for buildings in two categories. In the historical data category, buildings had to improve on past energy consumption. The winner was 40 Holborn Viaduct, owned by Nuveen and managed by BNP Paribas Real Estate, which cut energy usage by 38.8%. Meanwhile, 20 Fenchurch Street owned by H Properties and managed by Savills took second place and XLB’s The Tootal Buildings, managed by Ashdown Phillips came in third.

Awards were also given in the ‘absolute value’ category, which focuses on newly built or refurbished buildings. Each building was given an absolute energy budget based on UK Green Building Council Office Energy Intensity Targets. The Frames owned by Workspace came out top, followed by RO's GNR8 and The Howard de Walden's Estate’s head office at 23 Queen Anne Street.

German investment managers are worried about the risk of "stranded assets", which do not conform to ESG regulations. 

A survey carried out for consultants Aurepa Advisors AG and PwC Deutschland found that 65% of respondents saw a significant risk that older buildings in a portfolio will fall into energy efficiency category F or worse (EU energy performance ratings for buildings rank from A to G). According to 38% of respondents, non-ESG-compliant properties are already more difficult to finance.

Hannes Eckstein, founding partner of the Aurelius real estate group and board member of Aurepa, said: “Many properties are in danger of becoming stranded assets because of a lack of an appropriate asset management strategy. 

“However, a large proportion of older buildings across all asset classes can be transformed into energy efficient properties. Every property must be looked at individually to establish which refurbishment projects will contribute to their long-term value enhancement.”

The survey found that 57% of respondents believe the greatest pressure to make properties ESG-compliant comes from regulatory requirements. Meanwhile 36% said pressure came from mainly from within their own company, while only 7% reported pressure from investors.

More than a quarter of asset managers surveyed have portfolios where at least half the assets are non-ESG-compliant properties (see chart above).

There are different strategies for dealing with these properties; 46% said they would refurbish, 25% would sell and 13% demolish and redevelop.

Meanwhile, only 57% of respondents have agreed green leases with their tenants. Thorsten Schnieders, partner at PwC Deutschland, said: “It is not only asset management activities which are essential for the leverage of value creation potential. The occupiers must also take responsibility for conserving energy. Green leases are an effective tool for this but are unfortunately still something of a rarity.”

The anonymous online survey covered managers with aggregate of assets under management of €100 billion.