Making our assets more sustainable
Since 2015, Redevco’s individual Asset Business Plans include a specific section on sustainability with corresponding actions.
We use the BREEAM In-Use methodology (see next page for more details on BREEAM In-Use) to determine which actions to undertake as well as to measure and monitor our progress. The intent is to set achievable and realistic targets without jeopardising the financial and commercial objectives at asset level. By doing so, we demonstrate our ambition to continuously improve the environmental performance of our portfolio.
Reducing energy demand from human activity is a key environmental issue at a global level. This is especially the case for real estate, since buildings account for more than 40% of global energy demand. Our stakeholders identified energy use as a high material topic in our materiality assessment.
In our 2014/2015 Responsible Real Estate Investment report (p54), we showed that there is no direct relationship between the rental value or yield of retail real estate and an asset’s energy performance. As a responsible real estate investor, these findings do not mean that we should pay no attention to the environmental impact of our assets. Retail real estate is characterised by high energy consumption. This means that our key areas of focus when improving assets are to reduce energy consumption, generate renewable energy on-site and minimise emissions and pollution from the operation of our assets.
The rolling annual Asset Business Plan preparation and review cycle allows asset managers to identify and communicate which buildings will undergo improvements. It clarifies to our investors when these improvements will be made, in line with our medium-term target to ensure that at least 50% of our Assets under Management (by value) in scope for this target have a BREEAM In-Use ‘Very Good’ or better certification by 2022. At the end of 2017, 27 % of our AuM met this target, up from 18% at the end of 2016. As the management tool to understand and track environmental performance, BREEAM ensures that we maintain a holistic approach to sustainability. We improved the BREEAM In-Use rating of 42 assets in 2017, however we did not manage to maintain the rating of 15 other assets on the same level. In 2018, we plan to improve 29 assets.