Download PDF

2019

Real Estate

Assessment

Contents

Disclaimer: 2019 GRESB Real Estate Assessment Pre-Release

The information in this document has been provided in good faith and is provided on an “as is” basis. While we do not anticipate major changes, we reserve the right to make modifications prior to the official start of the 2019 reporting period on April 1 and the official release of the 2019 Real Estate Assessment. We will publicly announce any such modifications.

Introduction

About GRESB

GRESB is the environmental, social and governance (ESG) benchmark for real assets. Working in collaboration with the industry, GRESB defines the global standard for sustainability performance in real assets providing standardized and validated ESG data to more than 75 institutional investors, representing over USD 18 trillion in institutional capital.

For more information, visit gresb.com. Follow @GRESB on Twitter.

Overview of GRESB Real Estate Assessments

GRESB Real Estate Assessment

The GRESB Real Estate Assessment is the global standard for ESG benchmarking and reporting for listed property companies, private property funds, developers and investors that invest directly in real estate. The Assessment evaluates performance against 7 Sustainability Aspects, including information on performance indicators, such as energy, GHG emissions, water and waste. The methodology is consistent across different regions, investment vehicles and property types and aligns with international reporting frameworks, such as GRI and PRI.

The GRESB Real Estate Assessment provides investors with actionable information and tools to monitor and manage the ESG risks and opportunities of their investments, and to prepare for increasingly rigorous ESG obligations. Assessment participants receive comparative business intelligence on where they stand against their peers, a roadmap with the actions they can take to improve their ESG performance and a communication platform to engage with investors.

GRESB Developer Assessment

In addition to the GRESB Real Estate Assessment for property companies and fund managers that focus on themanagement of standing investments, GRESB provides a stand-alone GRESB Developer Assessment to evaluate the ESG performance of organizations that focus on development activities. The Developer Assessment focuses on policies, strategies, and measurable actions related to new construction and major renovation projects. It contains a subset of indicators from the GRESB Real Estate Assessment, plus the 14 indicators in the New Construction & Major Renovations (NC&MR) Aspect.

The GRESB Developer Assessment is designed for:

Supplement: Resilience

The GRESB Resilience Module is an optional supplement to the GRESB Real Estate and Infrastructure Assessments. It evaluates how real estate and infrastructure companies and funds are preparing for potentially disruptive events and changing conditions, assessing long-term trends, and becoming more resilient over time.

The Module is motivated by two key factors:

Supplement: Nareit Leader in the Light

GRESB works in close collaboration with the National Association of Real Estate Investments Trusts (Nareit), a GRESB Industry Partner. Nareit encourages its corporate members to complete the annual GRESB Real Estate Assessments, which, for the past six years, has been the basis for their annual Leader in the Light Award competition. The Leader in the Light Awards are presented to REITs in eight property sectors: Diversified, Global (for non-U.S. companies), Health Care, Industrial, Lodging/Resorts, Office, Residential and Retail. If there are both large and small cap entries that meet the awards criteria in a given property sector, awards are presented to both the leading large and small cap companies. To participate in the Leader in the Light Award program, Nareit members must complete both the GRESB Real Estate Assessment and the Leader in the Light Supplement. Once all sections of the GRESB Real Estate Assessment are completed, including the Leader in the Light Supplement, participants are able to submit their entire submission which will automatically be included in the Leader in the Light Award competition.

GRESB Infrastructure Assessment

The GRESB Infrastructure Assessment provides the basis for is a unique tool for the systematic assessment, objective scoring, and peer benchmarking of the ESG performance of infrastructure investments. The Assessment provides infrastructure investors with actionable information and the tools they need to accurately monitor and manage the sustainability risks of their assets, and to prepare for increasingly rigorous ESG obligations.

The GRESB Infrastructure Assessment has an initial focus on operating investments, infrastructure assets, companies and funds and covers a variety of infrastructure sectors, including:

Assessment participants receive comparative business intelligence on where they stand against their peers, a roadmap with the actions they can take to improve their ESG performance and a communication platform to engage with investors.

The role of the GRESB benchmark

GRESB’s global benchmark uses a consistent methodology to compare performance across different regions, investment vehicles and property types. This consistency, combined with our broad market coverage, means our members and participants can apply a single, globally recognized ESG framework to all their real estate investments.

The GRESB Real Estate Assessment is structured around seven aspects and contains approximately 55 indicators. The indicators follow a plan-do-check-act logic and are designed to encompass the wide variety of property companies and funds included in the benchmark.

GRESB results provide a practical way to understand ESG performance and communicate that performance to investors and other stakeholders. GRESB provides overall scores of ESG performance - such as the GRESB Score and GRESB Ratings - as well as detailed aspect-level and individual indicator-level assessments of performance. The key to analyzing GRESB data is in peer group comparisons that take into account country, regional, sectoral and investment type variations. This richer analysis enables fund managers and companies to understand their results in the context of their investment strategies and communicate this to their investors.

GRESB is committed to facilitating the use of its ESG metrics in investment decision-making processes and encouraging an active dialogue between investors, fund managers and companies on ESG issues. GRESB updates its Investor Member Guidance on an annual basis to assist GRESB Investor Members in their engagement with managers.

2019 Participation Fee

Participants can choose to submit the Assessment as a non-member and pay a nominal participation fee or submit the Assessment as a GRESB Member. Participation is free of charge for first-time participants who report under the Grace Period, and for companies and funds headquartered in non-OECD countries. GRESB Members, in addition to the benefits received by participants, have access to more advanced analytical tools and services as well as preferential marketing, industry recognition, and networking opportunities.

Additional information about the 2019 participation fee is available here.

Timeline and Process

The GRESB Real Estate Assessment opens in the Assessment Portal on April 1, 2019. The submission deadline is July 1, 2019, providing participants with a three-month window to complete the Assessment. This is a fixed deadline, and GRESB will not accept submissions received after this date.

The GRESB validation process starts on June 15 and continues until July 31, 2019. We may need to contact you during this time to clarify any issues with your response.

Results are published in September and are distributed as follows:

For an overview of key dates and activities for the 2019 Assessment cycle, please see the Assessment timeline.

Response Check

A Response Check is a high-level check of the Assessment response prior to final submission. It helps to reduce errors that may adversely impact the Assessment results and ensures the submission is as complete as possible.

The Response Check is available for request from April 1 to June 1, 2019 (midnight, Pacific time) subject to available resources. We strongly encourage participants to place their request as early as possible.

Fund Manager and Company Members are able to request a complimentary Response Check for one entity as a one membership benefits.

Guidance & Support

The Assessment Portal includes indicator-specific guidance, available under the “Guidance” tab that explains:

In addition to the guidance in the Portal, each Assessment is accompanied by a Reference Guide. The Reference Guide provides introductory information on the Assessments and a report-format version of the indicator-by-indicator guidance that is available under the Guidance tab in the Portal. The Reference Guide will be available on March 1, 2019.

The GRESB Assessment Portal has the following tools and functionality to help ensure an efficient and accurate submission:

GRESB works with a select group of Partners who can help participants with their Assessment submission. To learn more about the services offered by GRESB Partners, take a look at our Partner Directory.

Participants are able to contact the GRESB Helpdesk at any time for support and guidance.

GRESB Assessment Training Program

GRESB Real Estate Assessment Training is designed to help participants, potential participants and other GRESB stakeholders (managers, consultants, data partners) improve their ESG reporting through the GRESB Real Estate Assessment.

The training is divided into two sessions – Introductory and Advanced – to reflect the level of experience with GRESB.

Both programs are delivered via face-to-face group sessions, in select locations across all regions with GRESB participation, including Europe, North America and Asia Pacific.See dates and locations for 2019 GRESB Assessment Training.

2019 GRESB Real Estate Assessment Changes

GRESB works closely with its members and broader industry stakeholders to ensure the Assessment addresses material issues in the sustainability performance of real estate investments. The main focus of the 2019 Assessment development process were enhancements to asset-level reporting functionality and the integration of selected Health & Well-being Module elements. The changes serve the longer term development of the Assessment, support our efforts for good quality data and reflect the evolution of the real estate industry as measured by the benchmark over the last years.

The table below lists all changes, as well as their implications for your reporting process.

High-level comments

Continuous, all year use of the GRESB Asset Portal and API

With the year round availability of the Asset Portal and API, assets can be added and edited throughout the year. Added data can then be used during the reporting period for aggregation to portfolio level indicators.

Updated checks in the asset portal and improved guidance for asset level reporting

The updates to data integrity rules and live validation are designed to simplify reporting and improve data quality.

Updated API

API endpoints are updated and migrated to https://api.gresb.com/api/entities. For more information visit our updated API documentation.

The access to the Template Tool is no longer restricted to members.

The template tool enables participants to copy information across multiple submissions, reducing the amount of time spent replicating information across entities held by the same fund manager.

The Validation Interview process changes structure and will be mainly based on a desktop review.

While the scope of the Validation Interview will remain the same (the validators will do an in-depth analysis of all supporting evidences, mandatory and non-mandatory, performance indicators and outliers), the Validation Interview report, the call with the participant, and the participant’s ability to change their responses following the call will be removed from the process. Participants will continue to be automatically notified if they are selected for a Validation Interview and there may still be instances where we need to contact the participant for missing supporting evidence, additional information, clarifications or corrections to the data submitted.

A selection of Health & Well-being indicators are incorporated into the Real Estate Assessment

With the release of the 2018 results and after a successful 3-year cycle, the Health & Well-being Module has served its purpose as an exploratory vehicle and incubator for new indicators. In 2019, a selection of health & well-being indicators are incorporated into the GRESB Real Estate Assessment, effectively making these indicators a reporting requirement for all GRESB participants. The newly introduced Health & Well-being indicators are grouped as a separate section in the Stakeholder Engagement aspect.

Validation Plus indicators

The Validation Plus indicator selection is performed by GRESB and is subject to change on an annual basis in order to rotate the validation scope every year. This allows GRESB to apply a consistent level of scrutiny on all participating entities. In 2019, the following changes are introduced:

  • MA1, PD3: are excluded from the Validation Plus scope and become APC indicators. 2018 supporting evidence is pre-filled and pre-validated
  • MA5, PD1: become Validation Plus indicators and the supporting evidence is reviewed for all participants

Indicators level comments

Entity & Reporting Characteristics

RC5.2

New evidence requirement for reporting boundaries provided in RC5.1

Rationale for change:RC5.1 determines the entity’s peer group composition and enables data checks on benchmarked indicators. To facilitate a fair and accurate benchmark, it is essential that the portfolio boundaries identified in RC5.1 are complete.

Impact of change:Increased participant and investor confidence in the accuracy of the GRESB Real Estate Benchmark. An improved ability to confirm accurate portfolio reporting in both Response Checks and Validation.

RC-NC1.1

Vacant land is excluded from the reporting scope.

Rationale for change:Vacant land does not share the same ESG issues as standing investments or development projects, and it does not directly associate to any performance indicator.

Policy and Disclosure

PD2

Two new options are added “Employee Health & Well-being” and “Tenant/customer and community health & well-being”.

Rationale for change:This is part of the Health & Well-being integration.

Impact of change:The scope of the indicator is expanded to assess the presence of policies to address employee, tenant/customer and community health and well-being. The indicator will still be pre-filled for 2018 participants.

PD4

Non-scored indicator is further developed to introduce a set of quantitative diversity metrics and the ability to report on governance bodies and employees separately.

Rationale for change:This indicator was introduced as a non-scored indicator in 2018. Building on last year’s answers, we have further developed it into a more analytical indicator on diversity.

Impact of change:The changes bring a better alignment with the GRI Standards and EPRA’s sBPRs.

PD5.2

Third-party verification and third-party assurance of sustainability disclosure receive equal points.

Rationale for change:Over the past years, the non-financial information third-party review industry has witnessed the development of several new verification and assurance standards. The level of scrutiny underpinning such third-party reviews tends to be dictated by the standard used, rather than the terminology used to describe the review process.

Impact of change:The scoring is adjusted to recognize external verification in the same way as external assurance. “Other” answers provided to the Scheme name dropdown menu are subject to validation.

Risk and Opportunities

RO5/6/7

Indicators are simplified to reflect whether such measures exist across the portfolio. The column for individual measure descriptions is replaced by an open textbox below the table.

Rationale for change:Participants no longer need to report on the measures that were implemented over four years ago.

Impact of change:Reduced reporting burden.

Monitoring and EMS

ME2

Evidence removed.

Rationale for change:The supporting evidence for this indicator was validated for a few consecutive years. More than 99% evidence uploaded in 2018 was Accepted.

Impact of change:Reduced reporting burden.

Performance Indicators

Asset level data

Enable the download of asset-level data

Rationale for change:Provide a more flexible asset level reporting process controlled by the participant.

Impact of change:This can be done once outliers are solved and missing data is completed, enabling the participant to use a curated dataset online (through the portal) and offline.

PI1.2/ PI2.2/ PI3.2

Open text box for description of intensity calculation methodology is removed, and the scoring of these three indicators is updated.

Rationale for change:The information provided via the text boxes was repetitive and lacked specificity. This is a simplification step towards the 2020 Assessment framework, which will simplify these indicators even further.

Impact of change:Scoring for these indicators remains the same, but the points previously assigned to the open text boxes are re-distributed to the intensity data tables and selection of normalisation factors.

PI2.1

Table is extended to capture emissions from outdoor / exterior spaces

Rationale for change: Participants with outdoor / exterior spaces energy data reported in PI1.1 (and particularly those with only outdoor / exterior spaces data available) were not able to correctly represent the emissions corresponding to this consumption, leading to outlier messages in some cases.

Impact of change:A more accurate representation of GHG emissions data. No impact on scoring.

PI1.4/ PI2.3/ PI3.4/ PI4.2

Third-party verification and third-party assurance of data receive equal points

Rationale for change:Over the past years, the non-financial information third-party review industry has witnessed the development of several new verification and assurance standards. The level of scrutiny underpinning such third-party reviews tends to be dictated by the standard used, rather than the terminology used to describe the review process.

Impact of change:The scoring is adjusted to recognize external verification in the same way as external assurance. “Other” answers provided to the Scheme name dropdown menu are subject to validation.

Stakeholder Engagement

SE3.1

Indicator is incorporated into SE12.1

Rationale for change:Consolidation of health & well-being indicators into an individual section

Impact of change:Indicator maintains its score within SE12.1 and is pre-filled with the 2018 information (if applicable)

SE8.1

Evidence removed.

Rationale for change:The supporting evidence for this indicator was validated for all participants in 2018 and had a 90% Accepted rate. The remainder of 10% answers were Partially Accepted, with only a few exceptions.

Impact of change:Reduced reporting burden.

SE12.1/ SE12.2/ SE13.1/ SE13.2

New indicators on employees and tenants health and well-being.

Rationale for change:Integration of select indicators from the old Health & Well-being Module into the Real Estate Assessment.

Impact of change:The weight of the Stakeholder Engagement aspect increases as a result of:

  • SE12.1: 2p, S, IM
  • SE12.2: 0p, S, IM
  • SE13.1: 1.5p, S, IM
  • SE13.2: 0p, S, IM

New Construction and Major Renovation

NC7.2

The open textboxes for describing the entity’s definition of “net-zero energy” and referenced code/standards are replaced by checkboxes.

Rationale for change:Responses in open textboxes are difficult to compare and provide little analytical value.

Impact of change:An easier to report, better-structured indicator.

Entity & Reporting Characteristics

Entity Characteristics

Reporting Characteristics

New Construction & Major Renovations

Management

Sustainability Objectives

2018 Indicator

2 points , MP, G

3 points , MP, G

Sustainability Decision Making

2018 Indicator

2 points , MP, G

1 point , MP, G

3 points , MP, G

Policy & Disclosure

ESG Policies

2018 Indicator

3 points , MP, G

2 points , MP, G

2 points , MP, G

Not scored , MP, G

Sustainability Disclosure

2018 Indicator

4 points , MP, G

2 points , MP, G

Not scored , MP, G

Not scored , MP, G

Not scored , MP, G

Risks & Opportunities

Governance

2018 Indicator

1 point , IM, G

2 points , IM, G

Environmental & Social

2018 Indicator

2 points , IM, E

2 points , IM, E

4.5 points , IM, E

3 points , IM, E

2.5 points , IM, E

1 point , IM, E

Monitoring & EMS

Environmental Management Systems

2018 Indicator

3 points , MP, G

Data Management Systems

2018 Indicator

4 points , IM, E

Monitoring Consumption

2018 Indicator

3 points , IM, E

2 points , IM, E

Not scored , IM, E

Performance Indicators

Energy Consumption Data

2018 Indicator

Not scored

12 points , IM, E

1.5 points , IM, E

3 points , IM, E

1 point , MP, E

Not scored

3.5 points , IM, E

0.75 points , IM, E

0.75 points , MP, E

Not scored

3.5 points , IM, E

0.75 points , IM, E

0.5 points , IM, E

0.75 points , MP, E

Not scored

3.25 points , IM, E

0.75 points , MP, E

3 points , MP, E

Building Certifications

Green Building Certificates

2018 Indicator

10 points , IM, E

12 points , IM, E

Energy Ratings

2018 Indicator

3 points , IM, E

Stakeholder Engagement

Employees

2018 Indicator

2 points , IM, S

1.5 points , IM, S

1 point , IM, S

0.5 points , IM, S

Suppliers

2018 Indicator

3 points , MP, G

Not scored , MP, G

2 points , IM, S

2 points , IM, S

Not scored , MP, S

Tenants/Occupiers

2018 Indicator

4 points , IM, S

3 points , IM, S

1 point , IM, S

3 points , IM, E

3 points , IM, E

1 point , IM, E

Community

2018 Indicator

3 points , IM, S

1.5 points , IM, S

Health and Well-being

2018 Indicator

2 points , IM, S

Not scored , IM, S

1.5 points , IM, S

Not scored , IM, S

New Construction & Major Renovations

Sustainability Requirements

2018 Indicator

1 point

3 points

1.5 points

Materials and Certifications

2018 Indicator

2.5 points

2 points

5 points

Energy Efficiency

2018 Indicator

3 points

3 points

1 point

Water Conservation and Waste Management

2018 Indicator

2 points

2 points

Supply Chain

2018 Indicator

2 points

2 points

Health, Safety and Well-being

2018 Indicator

2 points

1 point

1 point

Community Impact and Engagement

2018 Indicator

1.5 points

1.5 points