Canadian property companies and private equity real estate funds ranked 11 points above the global average in the newly released GRESB survey results, which provide insights into the energy and sustainability performance of the worldwide real estate industry. (Republished from RENX.ca — first published September 9, 2015)
“When we compare companies in Canada to other global leaders, Canadian companies are showing top performance compared to other regions’ leaders,” said Real Property Association of Canada (REALpac) research and sustainability director Julia St. Michael.
The GRESB report is based on an assessment of 707 property companies and fund managers representing 61,000 assets and US$2.3 trillion in asset value around the world. The results showed a three-per-cent reduction in greenhouse gas emissions in 2014, a 50-per-cent increase in on-site renewable energy generation, and a 19-per-cent improvement in overall environmental, social and governance performance.
11 Canadian entities participated
A record-setting 11 Canadian entities participated in the GRESB report. They represented 2,059 assets and 419.64 million square feet of property worth US$96 billion.
St. Michael said REALpac is doing everything it can to encourage more firms to get involved by taking the best sustainability practices from its global partners and introducing them domestically.
“If you are a really big company with competitors internationally, it makes sense for them to see the global picture. But for smaller companies that only focus on the Canadian marketplace, I’m hoping that this type of breakout showing where Canadian companies are might encourage more participation and performance improvement.”
Bentall Kennedy Group was recognized as a global sector leader for diversified and diversified residential/office properties. Other Canadian companies acknowledged as global sector leaders were Equity Residential in the residential property category, Host Hotels & Resorts, Inc. in the hotel category and Ventas, Inc. in the healthcare category.
Above global average GRESB scores
The average GRESB score for Canadian companies was 67, well above the global average of 56. The GRESB score is broken down into separate scores for environmental, social and governance by mapping these issues to specific questions. The Canadian entities scored above the global average in the environment (59-48), social (73-58) and governance (78-69) categories.
Canadian companies excelled in the stakeholder engagement and policy and disclosure categories, according to St. Michael.
“Policy and disclosure often happens at a more senior or corporate level, while stakeholder engagement can be building by building, tenant by tenant, individual by individual and property management team by property management team,” she said.
All of the Canadian companies and funds reported having sustainability policies, and five of the 11 included provisions addressing climate risk and six of them addressed resilience. They all performed health and safety checks, with 73 per cent monitoring specific health and safety indicators, including measuring lost day and absentee rates.
The Canadian participants, on average, also achieved a 3.74-per-cent reduction in greenhouse gas emissions and used 2,311 megawatt hours of renewable energy generated on-site.
GRESB was launched in 2009 as an industry-driven organization committed to assessing the sustainability performance of real assets, including real estate portfolios and infrastructure assets, around the globe.
More than 150 members, of which more than 50 are pension funds and their fiduciaries, use the GRESB benchmark results throughout the investment management and engagement process to optimize the risk/return profile of their real asset investments.