Realcast: Balkans warm to ESG – Florida backs off, funding net zero, BL goes underground

In the headlines this week:

The past seven days has seen interest rate rises in the US and Europe making it 95% certain that a rate rise is imminent in the UK as well.

Meanwhile, Montenegro’s recent Western Balkans ESG Summit, attended by the country’s entire government, with high level representatives from the region’s banks, asset managers and industrial groups too, all eager to learn more about putting ESG into practice. There was acknowledgment that the region is further behind Western Europe in terms of embracing ESG, but there is growing awareness that it is an essential concept.

In France, construction work started on the world’s first fully recycled concrete building in which even new concrete is made entirely with reused materials, including water, cement and aggregates, which will save 6,000 tonnes of natural resources.

The UK Green Building Council has now created an embodied carbon task group to tackle the problem of the limited amount of accurate and consistent measurement and reporting of embodied carbon. The group is trying to work out a framework and guidelines in an otherwise unregulated area. Meanwhile, in the US, things could be going backwards as Florida’s governor, Ron DeSantis, a possible Republican presidential candidate, has signed into law a bill that bars state officials from using state money to invest in ESG products. It also prohibits ESG bond sales in Florida, an otherwise popular means of funding renewable energy projects.

Azora Capital is establishing a new private equity fund to invest €250 million in European lower mid-market companies providing solutions for decarbonising property assets through urban solutions, energy solutions and sustainable agriculture. Azora has already invested in a Spanish company that has developed a sustainable almond farming practice and in a London-based company that helps businesses offset their carbon emissions.

Also in London, British Land is to develop an ultra-low carbon underground logistics hub close to London’s Paddington station.

In Germany, Vonovia, the country’s largest real estate group, sold a major residential portfolio to CBRE Investment Management for €560 million, following soon after the sale of a minority stake in its Südewo portfolio to Apollo Global Management for €1 billion.

But while transactions are returning to the news giving cause for optimism, symptomatic of the state of the market, JLL has posted a $9 million first quarter loss, although it too expects a recovery later in the year.

Click on the video to see the full discussion or listen to the podcast below.