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Research already acknowledged the many benefits of green building, mainly for the environment. But it was not clear whether it is possible to attach a financial value to those benefits, an information crucial to the real estate industry and the investment community.

Do green buildings attract a financial premium in terms of rental and sales value?
Are they more attractive to tenants and occupiers?
Are employees occupying green buildings more productive?
These are some of the questions addressed by the report “The business case for green business”, promoted by the World Green Building Council and sponsored by Grosvenor among others.

Research already acknowledged the many benefits of green building, mainly for the environment. But it was not clear whether it is possible to attach a financial value to those benefits, an information crucial to the real estate industry and the investment community.

In order to answer those initial questions, the report includes a review of the costs and benefits for developers, investors and occupants. And the findings leave no doubt: yes, there can be added a financial value to green building.

In what concerns the design and construction costs, building green does not necessarily mean spending more. Particularly if cost strategies, program management and environmental strategies are integrated in the process right from the start.  

When the asset value is the issue, as investors and occupants become more knowledgeable about and concerned with the impacts of the construction, buildings with better sustainability credentials benefit of increased marketability. In some markets there is already evidence of emerging ‘brown discounts’, where buildings that are not green. Besides, building green has shown to be money saving in operational costs: this saving is achieved, for instance, through reduced energy and water use, exceeding any design and construction costs within a reasonable payback time. When the work productivity and health are at stake, the case is, once again, in favor of green buildings, with research concluding that green indoor attributes of workplaces can improve the well-being of the workers. 
And this, ultimately, are business benefits.

The report also evaluates the risk mitigation associated with sustainability. Between the risks identified there are the regulatory ones, since many countries already have environmental guidelines for the construction industry that penalize inefficient buildings , the extreme weather events and changing tenants’ preferences that can question the resilience of the building and the risk of its obsolescence.
The study shows a business case for green buildings – it’s not just about saving the planet.

Prepared by the WGBC in cooperation with PRP, sponsoring partners included Skanska, Grosvenor and Estidama

In a letter to the President of the European Commission Jean-Claude Juncker and his team, the real estate industry urges initiation of a high level EU dialogue with Europe’s real estate sector and development of a coherent policy approach. INREV and 40 other associations argued that cooperation at the EU level is essential to create a healthy and well-functioning real estate sector, important for jobs, growth and the broader European economy.
 

In accordance with their long standing commitment to sustainability, Sonae Sierra sought to implement the highest standards of Environmental, Safety and Health management on the Loop5 project, both in the development and operation phases.

LOOP 5 is a 56k m2 shopping centre in Weiterstadt, Germany, that demonstrates exceptional environmental, safety and health performance, built under Sierra's Environmental Management System and with a construction certified in accordance with the ISO 14001 environmental standard. It was conceived to be highly functional, bringing the world of aviation alive for its visitors in its themed architecture.

Prepared by Sonae Sierra and INREV

A global survey based research paper that shows the importance of qualitative information such as environmental, social and governance (ESG) reporting to investors and other key stakeholders in their decision- making process. 

The last few years, corporations have started to report more non-financial information, including data on their environmental, social and governance (ESG) performance. The growing trend driven by regulation, market advantage or meeting the needs and concerns of key stakeholders is changing global business behavior. The survey was conducted amongst investors, analysts and portfolio managers. 

A number of these investors were interviewed to gain a deeper understanding of their answers. Key trends and drivers for the uptake of ESG information are identified in the paper. 

Most investors use this information when assessing investments. They mostly use the information provided directly by the company themselves, rather than relying on third parties, such as ratings agencies. However, they are having difficulties in meaningfully comparing data and drawing quantifiable links between non financial and financial performance. 

Two-thirds of the investors used different methods in evaluating their non-financial disclosures and only half of this group uses guidelines to make their assessments. Amongst those that never consider ESG information in their decision making process, the main reason for not utilizing it was that in their opinion it was not material. Investors also said that they mostly used non-financial performance as a good risk benchmark. Risks such as poor governance history or the lack of long term strategy, were considered to be more important as the others. 

Investors said that they interpreted the disclosure of non-financial  performance as a means by companies to improve their corporate reputation. 

As the ESG information is considered more and more important, there is also a request from the investors to get a level of accountability of the information, preferably through independent audit verification but also through approval by the board and shareholders.

This could enable for investors to weigh their portfolios according to all sustainability risks. Almost half of the investors mentioned that an unclear strategy could make them completely rule out a company from their investment decision. Also a history of poor governance was emphasized as especially important as a deal breaker.

For reporters, this survey not only shows that their investors care about their non-financial performance. It also indicates why, how and when they use this information.

The key recommendations that reporters can draw from the results of the survey include:

• Invest in reporting
• Report on and highlight what’s truly material to your business performance
• Keep abreast of international developments
• Act now, or be penalized
• Get your governance right

Prepared by EY

Since the financial crisis industry demand for information and reporting has only increased. Having more practical, relevant industry guidelines can only help to improve transparency and encourage standardised reporting in our sector.

This webinar, led by Henri Vuong, INREV Director of Research and Market Information provides insights into what’s on the industry’s minds for the coming 12 months.

In line with the revised INREV Guidelines, this one hour webinar will introduce the key building blocks to support best practice in the area of adjusted NAV calculation.

It will include a high level examination of using INREV Net Asset Value (NAV), including short explanation of the calculation examples.

The webinar will include the following topics:

• Understanding  INREV NAV
• Walking through a calculation example
• How to report on INREV NAV and the level of disclosure according to INREV Guidelins
• Q&A

The webinar will be led by Jef Holland partner at Deloitte.

The real estate sector is expected to see an influx of capital in 2015 with a total of €42.5 billion earmarked for investment in global real estate, with 45.1% of this heading towards Europe.