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GWLRA plots net-zero 2050 plans amid continued GRESB success

IMAGE: Steven Marino, GWLRA's executive vice president of portfolio management
Steven Marino, GWLRA's executive vice president of portfolio management. (Courtesy GWL Realty Advisors Inc.)

GWL Realty Advisors Inc. (GWLRA) has earned a Global Real Estate Sustainability Benchmark (GRESB) five-star rating for the sixth consecutive year – coinciding with its official net-zero 2050 commitment and plans to grow its sustainable portfolio.

The company also placed in the top five per cent in the global Diversified / Non-listed / Core category – 12th out of 259 companies – and scored above the GRESB global averages in each of the main categories covering ESG issues, management and performance.

“I think we've continued to look at GRESB as an important barometer on the direction of our sustainability program. We're quite excited about the performance we've been able to establish," said Steven Marino, GWLRA’s executive vice president of portfolio management.

"And certainly we think it's testament to our commitment to the practice, in terms of how we've been able to advance the program over the last year, candidly, in two specific fashions."

With head offices in Toronto, GWLRA has over $18 billion in assets under management, comprising 254 properties and 46.9 million square feet of commercial space including office, industrial, retail and multiresidential assets. The majority of its portfolio is in office buildings, at 35 per cent of its holdings.

“One, we were able to expand our data coverage to include all asset classes, which is certainly important in the context of, ‘you can manage what you measure.’ ” he said. This allows GWLRA to determine where improvements can be made.

“Then secondly, we were able to screen our multifamily portfolio through the ENERGY STAR Portfolio Manager benchmark.”

GRESB says there were a record number participants in the rankings in 2022, with 1,820 entities globally, totalling $9.5 trillion in gross annual value across 74 countries. In 2021, 1,520 participants were surveyed.

The GRESB results build on other honours GWLRA has received recently, including in June at the 2022 HOOPP LEAP Awards – Stakeholder Engagement and Climate Leadership Innovator – for the company’s work on a rooftop garden as well as a portfolio-wide hazard and risk assessment.

GWLRA’s portfolio

From 2013 to 2021, GWLRA estimates it has saved $18 million in utility costs and reduced its greenhouse gas (GHG) emissions intensity by 31 per cent. It has also reduced in energy intensity by 23 per cent, water intensity by 35 per cent and waste-to-landfill by 21 per cent.

The portfolio is 86 per cent LEED and BOMA BEST-certified by square footage. As Marino explained in an email exchange with SustainableBiz, GWLRA continues to aim to certify 100 per cent of its portfolio, but recognize challenges exist – principally where tenants self-manage their site operations. On the upside, a number of industrial and retail properties are working toward their first BOMA BEST certifications.

“Ultimately, real estate contributes about 40 per cent of greenhouse gas emissions, and so it's critical that we are not complacent with the success we've had to date,” Marino said. “Within that, we continue to accelerate our commitment to our sustainability practice.”

In January, GWLRA announced a 2050 net-zero commitment.

“We're working through the active process of really building a framework around that,” he said.

The company uses five-year reduction targets for energy, water, waste and GHG emissions, based on performance benchmarks and property-specific considerations.

Property performances and tools

Marino said GWLRA's office properties achieved their 2021 portfolio-level targets, though the pandemic has created some challenges in tracking performance.

He also singled out the company’s resiliency screening process as an important tool. 

In 2021, GWLRA worked with a third-party risk analytics firm to complete physical risk exposure assessments for its assets, covering 20 natural hazards and climate-related events.

The assessments included physical risk scenario analyses of climate change projections for 2045 and 2070 under three warming scenarios. The process has since been integrated into the company’s investment policy and underwriting practice.

840 Howe St. in Vancouver was mentioned as an example of GWLRA’s net-zero goals. In early 2022, the company undertook a retrofit of the property on behalf of its clients, the Healthcare of Ontario Pension Plan (HOOPP) and the Canadian Real Estate Investment Fund No. 1 (CREIF).

The company retrofitted the building with a heat recovery chiller and replaced two of the three natural gas-fired boilers with electric boilers.

The upgrades are expected to reduce natural gas consumption by almost 60 per cent and cooling tower water use by about 25 per cent, while increasing baseline electricity use by only three per cent. This will result in a reduction in GHG emissions of 110 tonnes carbon dioxide equivalent (CO2e) per year, with estimated lifetime savings of 5,277 tonnes CO2e – equivalent to removing 1,148 passenger cars from the road for one year.

Future of GWLRA’s sustainable portfolio

GWLRA is continuing to expand its sustainability team. While Marino leads sustainability under the wider umbrella of his responsibilities, there are four others who are dedicated to the initiatives full-time. Marino referred to them as “corporate stewards.”

“It's premature for us to understand how many more resources we need to manage the program,” he said. “I think we continue to be prudent and thoughtful about how the program is developing where the opportunities exist for our business to continue to enhance sustainability.”

He said GWLRA is piloting several new technologies, but did not divulge specifics, noting only that their viability is being assessed before making commitments across the portfolio.

GWLRA has had multiple meetings with a third-party consultant on developing its net-zero 2050 framework, although there is no current timeline for its completion. Marino also highlighted peers, in and out of the real estate industry, that are making net-zero commitments.

“I think these are aggressive objectives and goals, and they need to be aggressive," Marino said, considering the importance of meeting our climate goals.

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