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Sustainability library

Sustainability is one of the game changers impacting today’s business value in the real estate investment sector.

INREV is working to highlight the importance of sustainability for the industry by encouraging investors and fund managers to have a meaningful dialogue about sustainability.

About INREV Sustainability

Sustainability is one of the game changers impacting today’s business value in the real estate investment sector.

INREV is working to highlight the importance of sustainability for the industry by encouraging investors and fund managers to have a meaningful dialogue about sustainability.

Sustainability Reporting Guidelines

The INREV Sustainability Reporting Guidelines have been revised to form a disclosure framework that delivers meaningful data to increase visibility and insight into a vehicle’s ESG efforts and also details their next course of action for improvements. 

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Sustainability best practice guidelines

These guidelines highlight best practice for sustainability reporting, providing industry crossover between GRESB, GRI, EPRA and INREV.

Best practice

Sustainability library

The Sustainability Library is an interactive library including reports and case studies from INREV members and also from ANREV that illustrate best practice worldwide.

PapersCase studiesANREV

Sustainability Committee

INREV's Sustainability Committee's goals are to further develop INREV's position on the importance of sustainability, be the centre of expertise to drive better understanding of the relevance of sustainability and to move the focus from asset level to vehicle level. 

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ESG in the Due Diligence Questionnaire

INREV's most popular tool, the Due Diligence Questionnaire (DDQ) includes questions on Environmental, Social and Governance (ESG) policies at a manager and vehicle level.

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Related downloads

Importance of sustainability in the real estate sector  

Published on 14 Nov 2016

90 seconds of INREV Sustainability Reporting Guidelines  

Published on 14 Nov 2016

Sustainability papers

Sustainability is one of the game changers impacting today’s business value in the real estate investment sector. There is a lot happening in the non-listed real estate industry and beyond to drive better understanding of the relevance of sustainability by industry participants, including the link between sustainability and financial performance.

The sustainability committee has highlighted the following publications to increase knowledge and market transparency, support measurement of sustainability and provide practical guidance for sustainable investments.

Related downloads

The impact of climate change on governance and risk management  

Published on 28 Mar 2017

One of the essential functions of financial markets is to price risk to support informed, efficient capital-allocation decisions and it is increasingly important to also understand the governance and risk management context in which financial results are achieved. One of the most significant, and perhaps most misunderstood, risks that organisations face today relates to climate change. While it is widely recognised that continued emission of greenhouse gases will cause further warming of the planet which could lead to damaging economic and social consequences, the exact timing and severity of physical effects are difficult to estimate. The large-scale and long-term nature of the problem makes it uniquely challenging, especially in the context of economic decision making.

To help identify the information needed by investors to appropriately assess and price climate related risks and opportunities, the Financial Stability Board recommends for consistent, comparable, reliable, clear and efficient climate related disclosures. The framework considers the impact of climate change on the following four elements: (1) governance, (2) strategy, (3) risk management and (4) metrics and targets. 

The Task Force on Climate-related Financial Disclosures (TCFD) was established to consider the financial stability risks associated with climate change. One of the most effective ways for addressing the financial stability risks that might emerge from climate change are effective disclosures to ensure that climate-related risks are effectively understood by financial markets. Effective disclosure of climate-related financial risks will help to avoid an abrupt repricing of risk and therefore will reduce risks to financial stability. The Task Force developed four widely adoptable recommendations on climate- related financial disclosures that are applicable to organisations across sectors and jurisdictions. Importantly, the Task Force’s recommendations apply to the financial sector, including banks, insurance companies, asset managers, and asset owners. Large asset owners and asset managers sit at the top of the investment chain and, therefore, have an important role to play in influencing the organisations in which they invest to provide better climate- related financial disclosures.

Prepared by the Task Force on Climate related Financial Disclosures

Closing the gap between Investor Relations and Sustainability Teams  

Published on 31 Jan 2017

ntegrating sustainability into investor communications is genuinely difficult and requires internal collaboration.

Too few companies get clear sustainability performance messages out to their investors and one of the main barriers is the internal dynamic between Sustainability and Investor Relations (IR) departments. 

The report makes the case for stronger internal engagement to enable proactive, integrated communications to investors. It starts by outlining five key gaps related with language, time frame, expertise, relationships and resources. It then moves on to examine each gap in detail, exploring the reasons, the pain points and solutions that have been proven to help close the gaps. The report also includes case studies in which companies have successfully applied the solutions to build stronger internal collaboration on investor communications.

In Closing the Sustainability-Investor Relations Gap, the report outlines five key gaps where Investor Relations and Sustainability teams feel misalignment:

  1. Language
  2. Timeframe
  3. Expertise
  4. Relationships
  5. Resources

The report makes detailed suggestion how to overcome such misalignment and presents practical steps organisations can take to improve the link between the investor relations and sustainability teams. 

Prepared by SustainAbility

Climate change investment solutions: a guide for asset owners  

Published on 17 May 2016

The aim of this guide is to provide asset owners with a range of investment strategies and solutions to address the risks and opportunities associated with climate change. The guide is targeted at asset owners and more specifically at trustee boards and investment committees, but also contains insights for asset managers. The guide concludes that there is a need for these actions to be more widely integrated into mainstream investment processes to ensure that investment portfolios are more resilient to the financial implications of climate change. This requires, in part, the development and adoption of new industry norms, tools and expertise that embed climate change into core investment processes, which this Climate Change Investment Solutions guide aims to contribute to.

The guide presents a framework for considering climate change investment solutions, by:

presenting actions to integrate climate change into investment beliefs and investment policies that are actionable and transparent,
discussing actions for measuring and managing the risks and opportunities of climate change, both within the existing asset allocation structure and through evolving the asset mix over time, mitigating investment actions to reduce the carbon intensity of existing assets, along with opportunities to invest in low carbon, clean energy and energy efficient assets.
discussing actions to reduce the vulnerability of existing assets to the physical impacts of climate change, as well as building exposure to adaptation opportunities. 
The guide also affirms that corporate and policy engagement are important complementary strategies which can address climate change risks across portfolios and facilitate new investment opportunities.

Prepared by the Global Investor Coalition on Climate Change

Five stage process to implement an organisational energy efficiency programme  

Published on 22 Mar 2016

A guide to developing the business case for saving energy in real estate portfolios.

This toolkit is a practical guide for organisations to plan and initiate energy efficiency programmes. It provides a variety of corporate approaches towards achieving efficient building portfolios, which assist in developing an approach that best fits your organisation.

The tool guides you through a five step process, first the creation of a vision, the planning of the implementation process, and the organisational implementation. This is followed by evaluation and measuring of the outcome and the final step is the conclusion of results and related feedback.

There are three main components to the Vision Stage of this toolkit that help establish a clear vision which is vital for a successful energy efficiency program. The tool helps with (1) formulating a clear statement of intent, (2) demonstrating an organisation's commitment and (3) forming a framework for subsequent program development and implementation.

In addition the tool helps set up the monitoring systems that are essential to support any energy reduction measures. Whilst this toolkit has been designed for standalone use, it can also be used to assist companies working towards the ISO 50001 Energy Management System Certification.  

Stakeholders who may be interested in using the tool are finance, sustainability, corporate, social responsibility, communication teams.

Prepared by the World Business Council for Sustainable Development

Inter-connections between risks are becoming stronger  

Published on 15 Mar 2016

A report connecting global risks to local economies.

60 million people, equivalent to the world’s 24th largest country, are forcibly displaced, and crimes in cyberspace costs the global economy an estimated US$445 billion, higher than many economies’ national incomes.

The Global Risks Report 2016 highlights the most significant long-term risks worldwide. The year 2016 marks a forceful departure from past findings, as the risks which the Report has been warning about over the past decade are starting to manifest themselves in new, sometimes unexpected ways and harm people, institutions and economies.

The responses from Europe show that the most dominant risks include fiscal crises, cyber-attacks, unemployment, asset bubbles and energy prices. In this context, the Report calls for action to build resilience – the ‘resilience imperative’ – and identifies practical examples of how it could be done. 

As resilience building is helped by the ability to analyse global risks from the perspective of specific stakeholders, the Report - for the second year - also provides country-level data on how businesses perceive global risks in their countries.

Prepared by The World Economic Forum

Transposition Study: Energy Audits for Europe from eurochambres.eu  

Published on 07 Dec 2015

What can be measured, can be improved.

An assessment of the transposition of the Energy Efficiency Directive into Member State legislation.

According to the EU Energy Efficiency Directive of 2012, companies are required to regularly undergo mandatory energy audits or implement energy management systems by the December 2015 deadline. At the same time, EU Member States must develop programmes to promote voluntary energy checks to SMEs, including through financial incentives.

Delayed transposition in eight Member States and missing secondary legislation in additional countries has created considerable legal uncertainty for businesses. Large companies are generally aware of the December 2015 deadline for conducting mandatory audits, though the conditions under which these audits have to be performed are, in many Member States, still unclear. Additionally about half of EU Member States are behind schedule in the provision of support programmes for SMEs to undergo energy audits and to implement identified energy saving measures. 

Prepared by EUROCHAMBRES – The Association of European Chambers of Commerce and Industry

Sustainable shopping centres: energy, performance and value  

Published on 14 Sep 2015

Are there financial benefits from improving the environmental performance of shopping centres?

According to this research, investing in sustainable features can increase shopping centres' market value by over 5%.

For the first time there is research-based evidence to support the real and tangible benefits of investing in energy-efficient features to drive shopping centre market value. The research, undertaken by CBRE, spans 35 shopping centres and uses valuation modelling to investigate the dynamic between energy efficiency (and associated costs) vs shopping centres’ asset value in relation to the premature scrapping of high energy equipment and replacement with new energy efficient kit. The concept is designed to decipher the impact on rents and yields for occupiers and owners of shopping centres, while highlighting energy risks and promoting sustainability awareness.

Prepared by BCSC and CBRE

The Business Case for green building: A review of the costs and benefits for developers, investors and occupants  

Published on 11 Apr 2015

Research already acknowledged the many benefits of green building, mainly for the environment. But it was not clear whether it is possible to attach a financial value to those benefits, an information crucial to the real estate industry and the investment community.

Do green buildings attract a financial premium in terms of rental and sales value?
Are they more attractive to tenants and occupiers?
Are employees occupying green buildings more productive?
These are some of the questions addressed by the report “The business case for green business”, promoted by the World Green Building Council and sponsored by Grosvenor among others.

Research already acknowledged the many benefits of green building, mainly for the environment. But it was not clear whether it is possible to attach a financial value to those benefits, an information crucial to the real estate industry and the investment community.

In order to answer those initial questions, the report includes a review of the costs and benefits for developers, investors and occupants. And the findings leave no doubt: yes, there can be added a financial value to green building.

In what concerns the design and construction costs, building green does not necessarily mean spending more. Particularly if cost strategies, program management and environmental strategies are integrated in the process right from the start.  

When the asset value is the issue, as investors and occupants become more knowledgeable about and concerned with the impacts of the construction, buildings with better sustainability credentials benefit of increased marketability. In some markets there is already evidence of emerging ‘brown discounts’, where buildings that are not green. Besides, building green has shown to be money saving in operational costs: this saving is achieved, for instance, through reduced energy and water use, exceeding any design and construction costs within a reasonable payback time. When the work productivity and health are at stake, the case is, once again, in favor of green buildings, with research concluding that green indoor attributes of workplaces can improve the well-being of the workers. 
And this, ultimately, are business benefits.

The report also evaluates the risk mitigation associated with sustainability. Between the risks identified there are the regulatory ones, since many countries already have environmental guidelines for the construction industry that penalize inefficient buildings , the extreme weather events and changing tenants’ preferences that can question the resilience of the building and the risk of its obsolescence.
The study shows a business case for green buildings – it’s not just about saving the planet.

Prepared by the WGBC in cooperation with PRP, sponsoring partners included Skanska, Grosvenor and Estidama

Sustainability Metrics - Translation and impact on property investment and management  

Published on 17 Mar 2015

This report seeks to demonstrate that the benefits of managing commercial real estate in a sustainable manner outweigh the perceived burdens of doing so if done in a systematic way.

It has been recognised that while the real estate industry has developed a broadly shared approach to assessing sustainability at the building- and investment vehicle-level, this does not necessarily happen in a co-ordinated manner.

The purpose of the report is to overcome the property industry’s complex web of information flows by introducing an organised and systematic approach.

It presents a framework for a Corporate Real Estate Sustainability Management system allowing property investment and management organisations to both meet their Environmental, Social and Governance (ESG) responsibilities and to establish an overall quality assurance mechanism.

The report concludes with 24 ‘best practice recommendations’ across the corporate, portfolio and property levels which can be used as a practical guide for property investment and management firms.

Prepared on behalf of the UNEP FI Property Working Group by Thomas Lützkendorf and David Lorenz from the Centre for Real Estate at the Karlsruhe Institute of Technology (KIT)

Tomorrow's investment rules - Global survey of institutional investors on non-financial performance  

Published on 17 Mar 2015

A global survey based research paper that shows the importance of qualitative information such as environmental, social and governance (ESG) reporting to investors and other key stakeholders in their decision- making process. 

The last few years, corporations have started to report more non-financial information, including data on their environmental, social and governance (ESG) performance. The growing trend driven by regulation, market advantage or meeting the needs and concerns of key stakeholders is changing global business behavior. The survey was conducted amongst investors, analysts and portfolio managers. 

A number of these investors were interviewed to gain a deeper understanding of their answers. Key trends and drivers for the uptake of ESG information are identified in the paper. 

Most investors use this information when assessing investments. They mostly use the information provided directly by the company themselves, rather than relying on third parties, such as ratings agencies. However, they are having difficulties in meaningfully comparing data and drawing quantifiable links between non financial and financial performance. 

Two-thirds of the investors used different methods in evaluating their non-financial disclosures and only half of this group uses guidelines to make their assessments. Amongst those that never consider ESG information in their decision making process, the main reason for not utilizing it was that in their opinion it was not material. Investors also said that they mostly used non-financial performance as a good risk benchmark. Risks such as poor governance history or the lack of long term strategy, were considered to be more important as the others. 

Investors said that they interpreted the disclosure of non-financial  performance as a means by companies to improve their corporate reputation. 

As the ESG information is considered more and more important, there is also a request from the investors to get a level of accountability of the information, preferably through independent audit verification but also through approval by the board and shareholders.

This could enable for investors to weigh their portfolios according to all sustainability risks. Almost half of the investors mentioned that an unclear strategy could make them completely rule out a company from their investment decision. Also a history of poor governance was emphasized as especially important as a deal breaker.

For reporters, this survey not only shows that their investors care about their non-financial performance. It also indicates why, how and when they use this information.

The key recommendations that reporters can draw from the results of the survey include:

  • Invest in reporting
  • Report on and highlight what’s truly material to your business performance
  • Keep abreast of international developments
  • Act now, or be penalized
  • Get your governance right

Prepared by EY

Sustainability case studies

INREV is working to highlight the importance of sustainability for the industry. There is a lot of existing practical knowledge about sustainability in the non-listed real estate. 

Many INREV members have been promoting and developing sustainability within their portfolios for years, and important lessons from these experiences are shared here via case studies.

Related downloads

CUBE 2020  

Published on 16 May 2017

CUBE 2020 is a European energy consumption contest for buildings, run annually by the Français pour la Performance du Bâtimen (IFPEB) in France. The contest awards winners based on their ability to reduce energy consumption in buildings over a one-year period through quick win solutions and improved management and operations processes. 

This case study features four projects and contest participants located throughout France. The following four case studies – taken from prize winners of the 2015-16 competition – illustrate the dramatic improvements in building efficiency that can be possible over a relatively short space of time. 
•    The Carré Suffren, Paris, owned by Foncière Des Régions (FDR)
•    Le Leoni, Montigny Le Bretonneux, owned by Perial Asset Management and let to Leoni Wiring Systems
•    Rennes Colombiers, owned by Poste Immo
•    Quai Vendeuvre, Caen, owned by Poste Immo

Using GRESB to leverage investment portfolio sustainability  

Published on 18 Apr 2017

Over the last 10 years or so, the investment community has become increasingly alert to the sustainability qualities of the property portfolios they invest in.

Sustainability has been embraced for its potential to provide cost savings to customers and value to capital partners, as well as for its benefits to wider society. The case study describes Goodman’s response to this trend and how they have continually improved their GRESB score resulting in a steady outperformance of the peers.

Goodman has developed a long-term approach to sustainability with a strategy focusing on four main areas: sustainable development, asset management, corporate performance, and people and community. In response to the lack of a specific external sustainability tool for industrial property Goodman has developed a unique assessment tool – the Goodman Sustainability Snapshot – to measure the energy efficiency features of its properties. The tool gauges the intrinsic quality of just the building. By measuring the quality of assets in this way, Goodman is better able to advise on investment and timing for feature upgrades, including those related to sustainability.

Prepared by Goodman and INREV

Shopping Centre Heuvel Eindhoven - BREEAM-NL In-Use Outstanding  

Published on 11 Oct 2016

The ambition to create the most sustainable redeveloped shopping centre in the Netherlands has paid off.

The case study of Heuvel Eindhoven shows how the implementation of a sustainable strategy can turn an outdated asset into one of the top-rated shopping centres in the Netherlands with a double Outstanding score. 

This project has been approached first and foremost from the perspective of sustainability and provides details of technical and operational improvements. 

This resulted in a BREEAM-NL In-Use Outstanding score for the asset and an Outstanding score for the operations. The score of 90.82% is the highest score in the field of operations in the Netherlands, unique for a 25 year old shopping centre. 

Prepared by CBRE and CBRE Global Investors

BRIGHT: Optimise Energy Consumption  

Published on 20 Sep 2016

BRIGHT is an innovative project developed by Sonae Sierra in 2014, which uses a theoretical model to produce optimal energy consumption figures for each of its shopping centres.

Le Terrazze in Italy provides a case in point. After applying the Bright analysis, it was found that the shopping centre was consuming more energy in practice than it should in theory.

Through a series of management measures, and the introduction of free cooling, Le Terrazze was able to identify potential savings of €163,000 – equivalent to 27% of the shopping centre’s annual electricity bill.

Prepared by Sonae Sierra and INREV

'Deep Green' facilities at Bentley Works  

Published on 30 Jun 2015

Skanska used the redevelopment of the Bentley Works factory to set the standard for future undertakings.

Bentley Works is 7.5 ha site for engineering, manufacturing and servicing which has been redeveloped into a state-of-the-art facility. Skanska used the project to create a new standard and developed an internal rating system with 'Deep Green' as the highest rating. Achieving net zero primary energy, zero waste, zero hazardous materials and net zero water, Bentley Works went beyond the minimum requirements of Deep Green.

Prepared by Skanska and INREV

Resource Efficiency and Safety First at Loop5  

Published on 26 Mar 2015

In accordance with their long standing commitment to sustainability, Sonae Sierra sought to implement the highest standards of Environmental, Safety and Health management on the Loop5 project, both in the development and operation phases.

LOOP 5 is a 56k m2 shopping centre in Weiterstadt, Germany, that demonstrates exceptional environmental, safety and health performance, built under Sierra's Environmental Management System and with a construction certified in accordance with the ISO 14001 environmental standard. It was conceived to be highly functional, bringing the world of aviation alive for its visitors in its themed architecture.

Prepared by Sonae Sierra and INREV

ANREV's sustainability library

Our sister organisation in Asia Pacific, ANREV, also has a sustainability library with over a dozen case studies.

ANREV's Sustainability Library

Have a sustainability case study or paper to share?

Please don't hesitate to contact us.