Regulatory requirements as well as increased demand and reputational risks are the main drivers of the incorporation of sustainable development for all participants in the real estate market. But how do we succeed in adapting to changed conditions and embedding carbon neutrality in our modus operandi? In order to remain successful, ESG aspects need to be incorporated in the strategic decision-making process, the corporate management, the investment and reporting process as well as any (trade) law-related and fiscal decisions. As we look back on years of experience and have been acting as pioneers in this field, we are happy to assist you on this path and support you with regard to the entire life cycle of your property.
Since buildings account for around 40% of the energy consumption and 36% of the carbon emissions in the EU, there is no doubting the enormous relevance that ESG goals have in the world of real estate. Hence improving the energy efficiency of all buildings is essential. The institutional real estate market is familiar with the concept of Green Buildings and certifications such as LEED/DGNB/BREEAM/ÖGNI. But even tenancy contracts based on ESG criteria are becoming more and more common.
The question arises as to what specific provisions can be included in “green tenancy contracts”. This development is not just relevant when it comes to the renovation of buildings but is essential during the project development stage. Since almost every phase of the construction and management of buildings involves the use of carbon, real estate companies would do well to start early on with the implementation of a decarbonisation programme of their own. This is the only way to reach the ambitious climate neutrality goals in Europe by 2050.
The relevant criteria have already been set by the Taxonomy Regulation
Furthermore, the EU Sustainable Finance Disclosure Regulation (SFDR) already contains an obligation for financial service providers to disclose sustainability aspects in their strategies, processes and products. The EU legislator’s Taxonomy Regulation provides detailed criteria as to what must be classified as ecologically sustainable. Apart from regulatory requirements there have been further first attempts at developing property-specific ESG criteria to assess the sustainability of properties and real estate portfolios. In this context it is worth mentioning the scoring system to assess the sustainability performance of properties and real estate portfolios developed by ECORE (ESG Circle of Real Estate), an initiative launched by Union Investment and Bell Management Consultants.
Hence, sustainability aspects are relevant in the real estate market when it comes to choosing and acquiring a property as well as for asset management and exit scenarios. We are happy to assist you with the respective investment strategies, the project development, the asset management as well as with any certifications that may be required.
Nach oben