All investors now ask what your sustainability strategy is, delegates heard at Real Asset Media’s European Outlook H2 Investment Briefing, which was held in Frankfurt recently.
‘Sustainability used to be a discussion but now it’s an absolute must’, said Lars Schnidrig, CEO, Corestate Capital Group. ‘30% of all Co2 emissions are produced by real estate, so what clients want to see is social and environmental governance. They want a clear ESG strategy with targets that are measurable and transparent’.
This trend started in the Nordics, he said: ‘I think in Germany we are far behind, in all fairness, but we must move quickly because sustainability is the next big thing. The important institutional investors will never buy from small asset managers because they lack ESG and they lack transparency and reporting standards’.
The real estate industry has ignored megatrends and failed to realise that property is no longer just about bricks and mortar, said Carsten Loll, Partner, Real Estate, Linklaters: ‘Things have changed dramatically. The traditional real estate industry must catch up or it will end up like the German car industry, which was in very good shape until Tesla and electric cars showed up’.
Corestate has spent the last year developing its own sustainability strategy, which is now up on the website, that commits the group to reducing Co2 and waste by 20% by 2025.
‘That is a commitment across our whole portfolio, which means we need systems, IT and processes to measure what is produced and assess progress,’ Schnidrig said. ‘But such a big undertaking is not my ambitious fantasy, it is what the clients want. We are just at the beginning: the ones who do not follow the trend will not be successful in this market’.
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