Existing buildings form a large part of most real estate portfolios. Many of these buildings have significant potential for improving both their greenhouse gas emissions and energy efficiency. We see vast potential in playing a role in accelerating the green transition of buildings.

In the real estate sector, newly constructed buildings account for less than a third of greenhouse gas emissions. The majority of emissions originate from the existing stock of buildings. To address this, a targeted effort is required to transition from ‘brown’ to ‘green’ properties. Our aim, in this regard, is to retrofit our existing properties. 

The key benefits driving our commitment to this transformation include (i) reduced energy consumption, (ii) lower energy costs, and (iii) decreased carbon emissions. Additional benefits include:

• lower financing costs – due to (i) alignment with EU taxonomy regulations, or (ii) lenders’ requirements or preferences related to reducing greenhouse gas emissions, 
• increased appeal to prospective tenants – as more tenants become environmentally conscious and focused on lowering their carbon footprint, and
• potentially a higher price – in the event of sale.

Operational emissions – greenhouse gas emissions related to the energy used to operate buildings - account for approximately 70% of total emissions in the real estate sector. Embodied emissions - greenhouse gas emissions related to the materials used and construction of buildings - account for the remaining approximately 30%.

Our focus is to apply targeted measures to reduce both operational and embodied emissions across our portfolio. This includes embedding low-carbon strategies into the construction of new projects and the refurbishment of existing buildings, as well as actively working to lower emissions through the operation and maintenance of our properties. 

This integrated approach is fundamental to minimising our carbon footprint and achieving our long-term sustainability goals.

It is estimated that:

• the equivalent of New York City will be built every month for the next 40 years, driven by rising population and urbanisation, and 
• over 40 billion tonnes of virgin materials are extracted annually to construct the built environment. 

We believe that circular construction plays a vital role in balancing the fast-paced demand for urban development with the urgent need to reduce material extraction - making human activity more compatible with the planet's safe limits. Our aim is to propel circular construction by using solutions that reduce, reuse and recycle materials.

To lower the carbon footprint of buildings and to build better with less, we are continuously advancing innovative and sustainable building solutions. This includes:

• supporting modern methods of construction, such as volumetric modular construction or other forms of prefabrication, and 
• using low-carbon, sustainable and responsibly sourced materials.

In Europe, construction and demolition materials – from buildings reaching the end of their life cycle – account for roughly one-third of total waste volumes. 

We are committed to working with our contractors to ensure that the majority of waste from our construction sites is not sent to landfill. We support initiatives that facilitate the recycling of construction and demolition waste into alternative materials that can be used in new building solutions.

By driving forward circular construction, our aim is to unlock economic growth in a way that is both climate-friendly and nature-positive.

Our aim is to use climate simulation models – to anticipate different future climate scenarios – in order to assess the climate-related risks that our properties could face. 

This will enable us to:

• take targeted action to mitigate the future impact of climate change, and 
• inform the design of our future developments as well as our investment decisions. 

We take a long-term view, anticipating change and adapting our approach accordingly. Our properties are built to last and we are focused on ensuring that they can withstand the extreme weather events arising from climate change.

Ensuring that our properties are climate-resilient is a key lever for increasing long-term asset value.

As physical climate risks become more severe and frequent, requirements related to climate resilience will continue to rise. We want to ensure that we are well positioned for this change.

Our goal is also to make it easier and more cost-effective to keep our properties warm in the winter and cool in the summer – enhancing both environmental performance and resident comfort.

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