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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

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

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

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

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

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

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

The European non-listed property funds industry is laying the groundwork for an improved focus on sustainability. This report takes GRESB's data on non-listed real estate funds and analyses their sustainability performance, with a particular focus on European funds, to provide more tailored information and guidance to our members on this topic.

As part of its commitment to supporting its members to improve their sustainability efforts, INREV is a partner in the Global Real Estate Sustainability Benchmark (GRESB), a global consortium of institutional investors and real estate industry associations committed to assessing the sustainability performance of real estate portfolios. One of GRESB’s main initiatives is its annual survey, which provides focus and direction for the real estate sector by benchmarking sustainability performance. The results provide an overview of sustainability activities and trends in global real estate for both the public and private sector.

The European non-listed property funds industry is laying the groundwork for an improved focus on sustainability. This report takes GRESB's data on non-listed real estate funds and analyses their sustainability performance, with a particular focus on European funds, to provide more tailored information and guidance to our members on this topic.

As part of its commitment to supporting its members to improve their sustainability efforts, INREV is a partner in the Global Real Estate Sustainability Benchmark (GRESB), a global consortium of institutional investors and real estate industry associations committed to assessing the sustainability performance of real estate portfolios. One of GRESB’s main initiatives is its annual survey, which provides focus and direction for the real estate sector by benchmarking sustainability performance. The results provide an overview of sustainability activities and trends in global real estate for both the public and private sector.

The European non-listed property funds industry is laying the groundwork for an improved focus on sustainability. This report takes GRESB's data on non-listed real estate funds and analyses their sustainability performance, with a particular focus on European funds, to provide more tailored information and guidance to our members on this topic.

As part of its commitment to supporting its members to improve their sustainability efforts, INREV is a partner in the Global Real Estate Sustainability Benchmark (GRESB), a global consortium of institutional investors and real estate industry associations committed to assessing the sustainability performance of real estate portfolios. One of GRESB’s main initiatives is its annual survey, which provides focus and direction for the real estate sector by benchmarking sustainability performance. The results provide an overview of sustainability activities and trends in global real estate for both the public and private sector.