Data centre company Equinix is the top-ranked real estate firm in Forbes' new ranking of US companies according to their progress on Net Zero.
Forbes used data from research providers Sustainalytics and Morningstar to rank the 100 large US-listed companies best positioned for a Net Zero 2050.
Equinix was in 23rd place; the only other real estate firm in the top 50 was Host Hotel & Resorts.
Other US real estate companies in the list included Simon Property, Kimco Realty and brokers JLL and CBRE. More detail on the rankings can be found here.
CapitaLand Investment has raised the bar for its ESG practice with a refreshed 2030 Sustainability Master Plan.
The Singapore-based real estate investment manager launched the original master plan in 2020, but the refresh “doubles down” on sustainability, says chief sustainability officer Vinamra Srivastava.
“We have doubled down on our sustainability efforts in the refreshed 2030 plan, aligning it with our Net Zero commitment, with targets validated by Science Based Targets initiative (SBTi) and have also expanded our social and governance focus.
“We are also deepening our efforts to reduce scope 3 emissions by forming partnerships with our supply chain vendors, engaging tenants to increase adoption of green leases at our properties globally and working with them to improve their sustainability performance.”
Amongst the new and adjusted targets CapitaLand Investment has pledged to increase the use of renewable energy from 35% to 45% by 2030 and to reduce waste intensity in day-to-day operations by 20%. The refreshed plan also introduces new social targets focused on social impact, human capital development, and employee wellness, including having at least 40% female representation in senior management.
CapitaLand Investment also released its latest sustainability report, showing that 58% of its global portfolio had received green building certifications, placing the firm on track to achieving 100% certification by 2030. Renewable energy forms 5% of total electricity consumption. The company also secured S$4.7 billion ($3.49 billion) of sustainable finance in 2022.
The company has been making continual improvements to its portfolio. CapitaMall Wangjing in Beijing (pictured above) was upgraded last year and achieved a LEED Gold rating in September.
Finnish real estate firm Citycon has updated its 2030 sustainability strategy to include new focus areas such as circularity and biodiversity.
The company owns a €4.2 billion portfolio of mixed-use developments in the Nordic region.
“We have updated our focus areas, objectives and measurements, all set out to achieve our long-term goals. We are very proud of what we have achieved the previous years, but we always strive to further improve,” said Kirsi Simola-Laaksonen, chief information officer and responsible for sustainability at Citycon.
Citycon’s new sustainability strategy includes six focus areas:
ESR has launched a 2030 roadmap for sustainability.
The Asia Pacific real estate investment manager said the new ESG 2030 Roadmap built on achievements under the 2025 roadmap, launched in 2020.
Jeffrey Shen and Stuart Gibson, ESR co-founders and co-CEOs, said: “Since the launch of the ESG 2025 Roadmap in 2020, we have taken big strides forward in our ESG journey. We continue to raise the bar on our ESG actions and impact, creating long-term value for our stakeholders.”
Since 2020, ESR, which has $150 billion of assets under management, has installed nearly 100MW of rooftop solar power capacity across its portfolio, exceeding its initial target of 52 MW by 2025. It has also improved the male/female staff ratio to 55/45 from 60/40 and secured sustainability certifications for 39% of its portfolio, as well as securing $3 billion of sustainability-linked loans.
The 2030 roadmap targets include achieving a 50/50 gender balance, sustainability certifications for 50% of the portfolio and creating an ESR Group Foundation programme with an investment capacity of up to US$20 million.
The most ambitious target is to install 1,000MW of rooftop solar capacity across the group’s portfolio, which has 45 million sq m of gross floor area.
KKR has acquired a data centre cooling solutions provider.
The investment firm is buying CoolIT Systems, a manufacturer of liquid cooling solutions, for an undisclosed amount and will seek to scale up the business globally.
Much of the energy use in data centres comes from mechanical cooling to counter the heat generated by servers.
Kyle Matter, who leads KKR’s global impact team in North America, said digital infrastructure such as data centres was crucial to the economy but added: “We also recognise that as a society we are grappling with the enormous energy usage and related environmental impacts that are only expected to accelerate with the rise of AI and other high-performance applications.
“We believe that liquid cooling has a critical role to play in helping to reduce the emissions footprint of our digital economy and we are thrilled to back CoolIT, a leader in this space.”
Link REIT has launched a sustainability education and collaboration centre.
The Hong Kong real estate investment trust’s Link Sustainability Lab, a 6,800 sq ft venue in Lok Fu Place, Kowloon, aims to integrate the best practices of sustainability into people's everyday life and business operations.
Link chairman Nicholas Allen said: "In this easily accessible Lab, Link will illustrate how the long-term vision of sustainability can be broken down into many actionable pathways and achievable smaller goals. By making sustainability accessible, actionable and achievable, Link hopes to popularise sustainability knowledge and demonstrate that sustainability can be adopted by everyone in the community as a viable lifestyle and business model."
The first exhibition is a called Take Eat Seriously and explores the connection between the modern food system and people’s daily lives. It also features a sustainable Cha Chaan Teng (traditional Hong Kong café) demonstration unit to how a traditional F&B operation can be made sustainable through multiple small changes.
French asset manager Amundi has launched a European real estate fund focusing on decarbonisation.
The Amundi Real Estate European Net Zero Ambition Strategy aims to maintain the carbon footprint of the portfolio below the CRREM 1.5°C trajectory model at all times and to target a reduction of 40% in greenhouse gas emissions by 2030.
It will mainly invest in more mature markets in Western Europe as well as some European peripheral markets and will predominantly target offices in prime locations as well as sectors such as logistics, residential, retail, and hotels.
The new real estate strategy forms part of a suite of “net-zero ambition funds” launched across several asset classes to help Amundi reach a global objective of net zero by 2050.
Vincent Mortier, group CIO at Amundi, said: “Trillions of euros of capital will be needed to speed the path to decarbonisation, which cannot be done by governments alone. The global asset management industry – which is expected to be managing over $145trn by 2025 – has the scale to make things happen and trigger the momentum required to get the world to net zero.
“This is why, as a European asset management leader, we are launching the net-zero ambitions range across active, passive, and real assets, so investors can fuel the transition and put their savings to work, while earning investment returns. It is also critical to provide investors with a wide range of choices in order to help them align their investments to a net zero decarbonisation pathway.”
A new study has mapped out global ESG regulations and reporting standards for real estate.
Mapping ESG: A Landscape Review of Certifications, Reporting Frameworks and Practices was led by the European Association for Investors in Non-Listed Real Estate Vehicles (INREV), the Principles for Responsible Investment (PRI) and the Urban Land Institute (ULI), and carried out by PwC with the support of a range of experts from leading real estate fund managers and investors.
The report is intended to provide the industry with a practical guide to navigating the myriad of ESG regulations, standards and certifications around the world.
PRI real estate specialist, Hani Legris said: “No single reporting standard, framework or certificate can cover all the wide-ranging regulatory and stakeholder requirements when it comes to ESG in real estate. Real estate investors face a dizzying array of options and obligations. Whilst the “right” choices will depend on the organisation’s ESG strategy and the jurisdictions they operate in, this report provides essential information to inform the process and is supplemented with case studies, which really helps to bring these topics to life.”
ULI Europe CEO Lisette van Doorn added: “We know that the variety of standards and regulations is bewildering, but it is possible to cut through the noise and accelerate real estate’s progress to net zero. Each organisation needs to choose the standards and metrics appropriate to their ESG strategy and their stakeholders. With this approach, there might well be an opportunity to reduce the ESG reporting burden.”
The report flags new challenges from regulations which are not harmonised and coordinated but which affect the entire industry. This lack of harmonisation and partly undefined legal terms pose a major challenge.
It also provides a number of case studies as well as a set of self-assessment questions to produce greater awareness of the core issues and areas that are anchored in the company’s ESG strategy.
The 14 standards mapped by the report, including ten with metrics specific to real estate, cover the EU, UK, USA, Canada, Hong Kong, Singapore, Japan and Australia.
The report can be downloaded here.
The latest report from the UN Inter-governmental Panel on Climate Change (IPCC), while yet again highlighting the urgent need for action, also shone a spotlight on the key role the clean energy sector and technology must play in meeting net zero. The UN looked at existing policies that have been implemented by governments globally, and found that on this existing pathway the world is looking at a temperature rise of 3.2 degrees, which will have catastrophic consequences. The report’s advocation of an accelerated switch to clean energy generation and the use of carbon capture technology can therefore be viewed as a call to motivate businesses and investors to lead on the reduction and removal of CO2 from the atmosphere to help mitigate the situation.
While not a silver bullet, we agree that harnessing the potential of the energy sector is absolutely key in the electrification and renewables agenda, followed by the role of biodiversity and regenerative ecosystems in climate change mitigation. It’s also extremely important for us to recognise that we need to push for fundamental changes in how the property sector currently approaches net zero carbon design and the use of circular principles in how we select and procure building materials. Even things that rely on behavioural changes, such as shifts to more sustainable diets and active travel, can be encouraged through the way we design cities and create places.
According to IEA Net Zero by 2050, A roadmap for the global energy sector, staying on the path to net zero requires the massive deployment of all available clean energy technologies – including renewables, electric vehicles and energy efficient building retrofits – between now and 2030. For solar power, this is the equivalent to installing the world’s current largest solar park roughly every day. To reach net zero emissions by 2050, annual clean energy investment worldwide needs to more than triple by 2030 to around $4 trillion. This will create millions of new jobs, significantly lift global economic growth, and achieve universal access to electricity and clean cooking worldwide by the end of the decade. The scale of the investment required, however, means that even though more businesses and investors are motivated to deliver projects than ever before, driven by their own assessment of the risks involved and shareholder pressure, they require the support of governments. Fortunately, we are starting to see this happen, but we shouldn’t be complacent.
In Europe, the focus of the recent RePowerEU plan is to provide funding to finance investments and emergency regulation to speed up permitting processes and reduce developer costs. The EU's emergency regulations define wind and solar as projects of overriding public interest and clarify the environmental and grid permit deadlines that approval authorities must meet within two years. The EU Net Zero Industry Act will also fast track permits, increase access to public and private funding, improve workers’ skills and training, and encourage trade deals for key raw materials. The European Commission has earmarked over €250 billion for clean-tech companies and brought forward its target for doubling solar capacity.
In the US, the Inflation Reduction Act 2022 (IRA) is trying to break the country’s dependence on Asian components, re-shore supply chains, and create clean-tech jobs, as well as cutting emissions. Climate and industrial policy are central to the IRA, which is aiming to revamp the US’s infrastructure and create advanced manufacturing jobs. It hopes to do so by strengthening tax incentives for renewable energy and other climate solutions; in total, $369 billion of green tech subsidies have been allocated. This is expected to underpin investment in wind and solar, although to be successful it will require additional permitting and regulatory reforms, as well as grid expansion and modernisation. While being a fairly radical step forward for the country towards net zero, analysts do not expect the US to become totally self-sufficient in terms of renewable energy infrastructure as most raw materials are sourced abroad.
Marylis Ramos (left, above) is director at Savills Earth Advisory and Eri Mitsostergiou is world research director at Savills.
The British Property Federation has slammed the UK government's latest Net Zero report as "another statement of intent when what we need is urgent action".
This week, the UK government published Powering Up Britain: The Net Zero Growth Plan, which outlines a number of measures for the nation's transition to Net Zero, including more investment in nuclear energy and carbon capture, as well as quotas for the installation of heat pumps and sales of electric cars.
Melanie Leech, chief executive of the British Property Federation (pictured above), said: “If government is serious about achieving Net Zero by 2050 there must be more recognition of the challenges in decarbonising the built environment, which accounts for around 25% of UK emissions.
“While the report acknowledges the planning ‘bottleneck’ in updating historic and listed buildings, there must be more urgency in aligning the planning system to the net zero agenda and a national retrofit strategy that supports and incentivises green refurbishment.
“We also need clarity on minimum energy efficiency standards and regulation that establishes a clear and consistent methodology for measuring the environmental performance of a building over its full life cycle, which will guide the property sector in how to approach development and refurbishment.
“The property sector is fully committed to net-zero but Government must seize the moment and deliver bolder and more ambitious policies that will support the rapid change needed.”
