BREEAM USA experts on the pathway to carbon net zero in real estate

“Global investors need to have reliable standards to measure net zero carbon,” shared Derk Welling. “[APG] invests in many real estate entities, and that requires that we collect quality data at asset level, which allows us to see and identify what assets are aligned with net zero.”
“We have a long history of financial data coming at a quarterly rate, and yet our ESG data comes annually,” added Neil Pegram. “I see a lot of our fund managers with sophisticated systems now saying, ‘let’s start reviewing this [ESG data] with our quarterly reporting and let’s parallel it with the financial reports.’ I think that will increase the accountability of landlords and managers.”

“One of the things that we do through BREEAM is verify data [that’s collected],” shared Breana Wheeler. “BREEAM’s certification process requires that performance claims are backed up by documentation and verified on site by a licensed assessor. Credits are only rewarded by the assessor when the documentation requirements are met and when the assessor has visited the site and confirms that the documentation and what they see at the site matches. This is the kind of data that can be  confidently  used to inform an organization’s planning towards net zero or be used with CRREM.”

“There has been heavy activity in terms of national determined contributions — those are commitments or better said statements that countries make to fulfill their commitment according to the Paris-accord they signed off already in 2015: This will eventually lead to more regulation globally,” noted Prof. Sven Bienert.   “ We will see [two] parts with regards to risk: more physical risk and of course the risk that is attached to transition. Companies might lose their competitive position if they are not in line with the decarbonization and regulatory requirements. CRREM can help you identify properties which are not aligned to Paris-proof decarbonization requirements.”  

“I think about debt,” noted Kenneth Lang. “There is so much money that is underlining commercial real estate, and if lenders are going to make CRREM compliance part of their information to be sent to the lender, you will begin to see disclosure become extremely important, more perhaps than at the asset level.”

“[CRREM] can process data from properties where you don’t have full data coverage,” Bienert shared, adding a perspective on how CRREM supports complex data evaluation. “But I think the point is, get started — not everything is perfect now, but executives have to work on the right topics and be clear on the data coverage and challenges they need to address regarding their portfolios. We have the opportunity to just say, ‘Ok, I have data of these five tenants and I do not have full data coverage.’ You can still get a fairly reliable figure and know what you need to work on in the future.”