Investors and managers across Europe are setting ambitious ESG strategies, however, they struggle to translate those strategies into tangible financial outcomes.
Our new ESG Valuations Focus Group will bridge this gap by helping to evaluate how ESG goals impact underwriting inputs and expected returns. Most notably, the group will seek to drive greater consistency across the industry on how ESG data and assumptions are incorporated into future value estimations. One of the focus group’s key objectives is to develop a framework of ESG factors that should be considered in underwriting real estate investments. The framework will include critical considerations, such as how costs are communicated between valuers, managers and investors to reduce the risk of double-counting.
The group comprises senior experts from across the industry, such as investment managers, institutional investors, valuers, and representatives from the Big Four accounting firms. The organisations include:
- KLP
- APG
- PGGM
- Ivanhoé Cambridge, the real estate group of CDPQ
- CBRE IM
- DWS
- AXA IM Alts
- Altera
- Savills
- JLL
- PwC
- EY
This initiative comes as a direct response to growing demand from the industry for greater clarity on the impact of ESG in real estate underwriting. Our ultimate aim is to move the industry beyond theoretical discussions to a more tangible, numbers-driven approach for ESG valuations.
During the INREV Annual Conference 2025 open house break-out sessions in April, we will discuss the first findings of the group.