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Canadian portfolios earn 2021 GRESB Sector Leader status

The 2021 GRESB ratings have recognized real estate portfolios and funds owned and/or managed by 1...

IMAGE: GRESB Logo.The 2021 GRESB ratings have recognized real estate portfolios and funds owned and/or managed by 10 Canadian-based companies as Sector Leaders in their respective categories within The Americas.

The much-anticipated annual results, which were publicly released this week, score the ESG performances of participating companies and organizations around the world. This year, GRESB reports its largest participation ever, with data reported for 1,521 real estate portfolios. The participants own and operate over $7 trillion worth of real estate.

Canadian portfolios recognized as Sector Leaders include those of: BentallGreenOak (Sun Life), Manulife Investment Management, RBC Global Asset Management – QuadReal, Ivanhoe Cambridge, Cadillac Fairview, KingSett, First Capital REIT, RioCan REIT and Oxford Properties.

“This year, participation in the GRESB Real Estate Assessment jumped an impressive 24 per cent to 1,520 portfolios across the globe,” said Charles van Thiel, director of real estate at GRESB, in the announcement. “The industry continues to make impressive strides, deepening its commitment to ESG transparency and focusing on improving sustainability performance.”

GRESB average scores rise

Average GRESB scores increased to 73 (out of a possible 100 points) for the Standing Investments Benchmark and 79 in the Development Benchmark.

Significant global performance improvements were noted in GHG emissions (down 8.24 per cent), water usage (down 4.14 per cent) and waste reductions (with 42 per cent more waste diverted). GRESB reports this is a result of both COVID-19 restrictions and continued investment in improving efficiencies.

The ratings offer a variety of recognitions to participants. Top performers both globally and by geographic region are granted Sector Leader status. No Canadian company portfolio was a global leader.

There is also a five-star rating system, with the top 20 per cent of performers being awarded five-star rankings.

“With the increase in overall GRESB scores, the challenge to both receive and maintain the five-star designation persists,” van Thiel said in the announcement.

In the overall scores, the Oceania region continues to lead the way with a regional average score of 79 in the Standing Benchmark and 84 in the Development Benchmark.

Top Canadian performers

The Canadian portfolios topping their sectors in The Americas were (Sector Leaders are firms with the top score in their category, plus other firms within one point of the top score):

Standing Investments (Overall Regional Sector Leaders – Americas)

– Diversified Office/Industrial: Manulife Investment Management Global Real Estate Portfolio;

– Diversified: RBC Canadian Core Real Estate Fund, RBC GAM – QuadReal;

– Diversified – Office/Retail: Cadillac Fairview.

Regional Sector Leaders

– Retail Non-Listed: Ivanhoe Cambridge managed portfolio;

– Diversified Office/Industrial Listed: Manulife Investment Mgmt Global RE Portfolio;

– Diversified Office/Retail Non-Listed: Cadillac Fairview;

– Diversified Non-Listed: RBC Canadian Core Real Estate Fund, RBC GAM – QuadReal;

Development (Overall Sector Leaders – Americas)

– Diversified: CREIF, KingSett Capital;

– Retail: First Capital REIT;

– Residential: MEPT / BGO Diversified – BentallGreenOak;

– Mixed use: RioCan REIT;

– Diversified: Sun Life Assurance – BentallGreenOak.

Regional Sector Leaders:

– Diversified Non-Listed: CREIF, KingSett;

– Residential Non-Listed: MEPT/BGO – Bentall GreenOak;

– Diversified Office/Res Non-Listed: Oxford Properties (OMERS);

– Diversified Office/Res Non-Listed: Prime Canadian Property Fund, BentallGreenOak;

– Diversified  Non-Listed: Sun Life Assurance Co. BentallGreenOak.

In separate releases, several of the Canadian companies celebrated their accomplishments.

BGO lauds “exceptional performance”

BGO noted its platform hit a new high mark for “exceptional performance.” The firm placed four of its flagship investment strategies among the top-20 percentile, earning higher scores than in previous years and five-star ratings.

For the first time, all of its funds participating in the GRESB development category earned Sector Leader status within their asset classes:

– BGO Diversified US Property Fund achieved a five-star rating with a score of 90.

– Prime Canadian Property Fund achieved a five-star rating with a score of 89.

– The Sun Life General Account achieved a five-star rating with a score of 89.

“The pursuit of excellence in ESG is a firm-wide, collective effort and defining characteristic of the culture at BentallGreenOak, and every year the bar is set higher for us to showcase what is truly possible for impact and sustainable investing in the commercial real estate industry,” said Anna Murray, managing director and global head of ESG for BentallGreenOak in a company release.

“A cross-functional array of teams at BGO dig deep into each and every asset to realize new benchmarks for efficiency, sustainability performance, climate resiliency and a reduced environmental footprint that demonstrate how excellence in ESG is part of the enduring and differentiated value that we offer our investor clients, tenants and broader stakeholders.”

Ivanhoe, Manulife improve scores

Ivanhoe Cambridge noted its portfolio improved its ranking for the seventh straight year to take a Sector Leader honour with an overall score of 91 and a 30 out of 30 in ESG management.

Ivanhoe earned 86/100 for its global portfolio and a performance score of 56/70, which is 10 points higher than the average obtained by GRESB participants.

Manulife Investment Management’s 2021 assessment results in higher scores for both its real estate and infrastructure portfolios (infrastructure funds are reported separately from real estate).

“We are pleased with the results of the 2021 GRESB Assessment as we are in an excellent position with above-average scores for both real estate and infrastructure,” said Christoph Schumacher, head of real assets, Manulife Investment Management.

“Sustainable management will continue to be essential and is an expectation of investors in real assets. Responsible stewardship is imperative to protecting and growing the value of our assets and the GRESB ESG Benchmark helps us maintain and improve outcomes and demonstrate our commitment to ESG integration to clients.”

First-time participant Dream Office REIT also noted its portfolio earned a five-star rating and a score of 91.

Although not recognized as a sector leader, the performance is impressive for a first-year participant: “(It) is one of the best first-year scores in the GRESB real estate assessment, placing it in the top 20 per cent of the global benchmark,” the company reported.

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