Real estate companies are making strides in environmental awareness, cutting energy consumption and reducing carbon emissions, according to a new report.
GRESB, a data provider for environmental, social and governance (ESG) performance of real assets, last week released the results of its 2016 GRESB Real Estate, Developer and Debt Assessments.
The new data shows that companies and funds have reduced energy consumption by 1.2 percent reduction, made a two percent reduction in GHG emissions and close to one percent reduction in water use.
They are also putting greater focus on occupant health and well-being. “Commercial and residential real estate have significant environmental impacts, consuming 81 percent of total U.S. electricity use and contributing directly to 12 percent of U.S. greenhouse gas emissions. There is also growing recognition that real estate plays a central role in shaping public health as well as providing comfortable and productive indoor environments. Institutional investors have begun to recognize these issues as sources of value and risk,” says Dan Winters, head of North America at GRESB.
A record 759 real estate companies and funds participated in the assessment, representing more than 66,000 assets across 63 countries, with a value of $2.8 trillion.
Entities reporting to GRESB for seven consecutive years outperform their peers by an average of 12 points across all aspects of ESG. As a result, the overall GRESB Score increased by 11 percent to 60. In 2016, 18 debt funds participated in the GRESB Debt Assessment, an increase of 80 percent. The average GRESB Debt Score increased by six percent to 48.
Australia topped the list of envrionmentally conscious compnaies reporting for the survey with an average score of 74, which is 14 points above the global average.
This year’s North American GRESB data shows 15 percent growth in GRESB participation, with 178 North American property companies and funds providing information about ESG performance.
The 2016 GRESB data indicates that the North American real estate sector achieved 3.29 percent reduction in GHG emissions — the equivalent of 83,418 passenger cars.