by Brianna Crandall — September 26, 2014—The Global Real Estate Sustainability Benchmark (GRESB) recently announced the release of the 2014 GRESB results. A leading global source of portfolio-level sustainability data for the real estate industry, the dynamic benchmark provides more than 40 institutional investors, representing $5.5 trillion in assets under management, with timely, actionable information about the sustainability performance of property portfolios. It also serves as an indication of the growing importance of sustainability, and as an impetus to undertake sustainability measures at the portfolio and facility level.
The 2014 GRESB Report results not only demonstrate that sustainability reporting has improved, both in coverage and in quality of the data submitted, but also show significant development in the overall sustainability performance of benchmark participants, according to the researchers.
Highlights:
- 637 listed property companies and private equity real estate funds submitted data, covering 56,000 buildings with an aggregate value of $2.1 trillion.
- GRESB covers 52% of the FTSE EPRA/NAREIT Developed Index, with 38% in Asia Pacific, 76% in Europe, and 51% in North America.
- The overall GRESB score increased by 9 points and is now 47 (out of 100), mainly driven by an increase in the Implementation and Measurement score (+23%) .
- Listed property companies obtain on average a 7 points higher score compared to private funds. The overall score for listed companies is 52.
- Collectively, in 2013, the commercial real estate sector reduced its energy consumption by about 0.8%, carbon emissions fell by 0.3%, and water consumption fell by 2.3%.
- Regionally, the overall performance of property companies and funds in Asia increased most significantly, by 23% to 46 points, while Australia/New Zealand still lead in overall sustainability performance, with a score of 61. The average score in North America is 44, and the average score in Europe is 47.
Five years after the launch of the benchmark in 2009, GRESB participation has become standard practice for most of the world’s fund managers and listed property companies, says the group. There has reportedly been a more than 220% increase in response rate since 2009. Sustainability and its broad spectrum of aspects are annually assessed by GRESB, focusing on: executive decisions, plans and policies; performance measurement; and stakeholder engagement. In consultation with the real estate industry, GRESB has further developed the set of metrics that constitute the most important sustainability issues for its more than 130 members.
The data provided by GRESB offers transparency, allowing pension funds and other institutional investors and lenders to incorporate responsible investment principles into their decision-making. For the global real estate industry, accurate benchmarking at the portfolio level will increase competition and the speed with which sustainability best practices diffuse into the market, points out GRESB.
The Global Real Estate Sustainability Benchmark (GRESB) is an industry-driven organization committed to assessing the sustainability performance of real estate portfolios (public, private and direct) around the globe. More than 130 members, of which 42 are pension funds and their fiduciaries, jointly representing USD 8.9 trillion in assets under management, use the GRESB benchmark results throughout the investment management and engagement process, with a clear goal to optimize the risk/return profile of their real estate investments.
