promising outcomes of responsible real estate investments
DESCRIPTION
Magnus Furugård, Managing Director - GES Investment Services - SwedenTRANSCRIPT
SUSTAINABLE REAL ESTATE INVESTING
WHAT IS SUSTAINABLE REAL ESTATE
”The sustainable design process recognizes that building materials – and the energy required to extract or create them – are not infinite and must be carefully considered during all aspects of design and construction, and even post-construction. Additionally, a sustainable building incorporates natural systems from daylight to fresh air providing superior environment for the occupants, as well as a better long-term contribution to the surrounding environment”(SOM – Skidmore, Owings & Merill LLP)
Energy efficiency
Water efficiency
Waste reduction
Client driven (tenants) and stakeholders
2G • E • S Investment Services
LOCATION, LOCATION, LOCATION
Good living conditions and working environment Natural Human Environment
• Natural daylight• ” close” to nature
Distance to workplace/Access to reliable public transport
Silent or low noise level
Access to sustainable energy – ”feeling good” advantage
3G • E • S Investment Services
INCREASING ENERGY PRICES
For more than 100 years energy has been easy to find and cheap to produce – no financial incentive to be efficient.
The Population has increased from 2 billion to 6 billion people.
Ignoring Climate Change will cause large environmental, social and financial consequences
Energy prices will through shortage market mechanism and political decisions increase.
International Energy Agency: Price of CO2 must double! (FT NOVEMBER 11 2009)
European Union target 20 – 30 % reduction until
Source: http://esa.un.org/unpp/
4G • E • S Investment Services
PLUS ENERGY BUILDINGS (¨Green tech” for real estate)
Paris building one of the first to produce more energy than it consumes
5G • E • S Investment Services
PASSIVE ENERGY BUILDING
Passive solar design
Superinsulation
Advanced window tech
Airtightness
The building must not use more than appr.15 kWh/m2 per year in heating energy
The Swedish National Board of Housing Building planning decrease the recommended energy consumption from 110 kWh/m2 to 55 kWh/m2 from JANUARY 2010
European Union target: - 20 to - 30 % CO2 until 2020
6G • E • S Investment Services
SUSTAINABLE REAL ESTATE INVESTING – The business case
ESG issues growing in importance for society at large
Tougher regulations – stringent policies, restrictions and subsidies/carrots
Resource efficiency – increasing resource prices
Better rental yields;• Better locations• Increased occupant comfort• Higher occupancy rates
Brand and reputation
Higher building values – long term business case
Good quality buildings = better liquid assets = increased return and reduced volatility of real estate investments
(Ivo Knoepfel and Gordon Hagart January 2008)
7G • E • S Investment Services
FROM SPACE TO SERVICE
Changed business model. Real Estate is about service
– just partly about selling/renting space
Water is a potential cash flow – sharing profit with tenant
Energy is a potential cash flow – sharing profit with tenant
Green areas are potentially value added areas Reduce noise
Better air
Stimulates health
Recreation
Diminish energy consumption
8G • E • S Investment Services
SUSTAINABLE REAL ESTATE INVESTING STRATEGIES
No cost• Property managers find ways to improve the social or
environmental performance of their properties at zero added expense
Value added• Create attractive buildings, retailbusiness and service concept
Best in class• Identify the best – such as Unibail Rodamco
Active Engagement• Engage in companies with high potential
Policy – Transparency – Key indicators
9G • E • S Investment Services
GOVERNANCE AND MANAGEMENT
10G • E • S Investment Services
OUR RESEARCH
BRITISH LAND CO CITYCON OYJ CORIO DEUTSCHE EUROSHOP GANT DEVELOPMENT S.A. GECINA GLOBE TRADE CENTRE HAMMERSON HUFVUDSTADEN AB ICADE IMMOEAST IMMOFINANZ IMMOBILIEN
11G • E • S Investment Services
IVG IMMOBILIEN AG JEUDAN KLEPIERRE LAND SECURITIES GROUP LIBERTY INTERNATIONAL PLC PSP SWISS PROPERTY SEGRO SPONDA OYJ SWISS PRIME SITE AG TECHNOPOLIS OYJ UNIBAIL-RODAMCO
OUR RESEARCH
Some results; One company is clearly ahead of the others, Unibail-
Rodamco – sustainability leader Larger transnational companies have generally a better
management than others One third of the companies/trusts don´t have any
disclosure of climate change performance Tenants and transportation emission is not our
responsibility approach The companies define its emissions very differently
12G • E • S Investment Services
ENGAGEMENT GOALS
Environmental policy
Measuring energy performance
Transparent reporting
Energy conservation programme in old buildings
New buildings = ”Green Tech”
13G • E • S Investment Services
