Australia’s commercial real estate remains the world’s greenest, with nine “remarkable” years at the top of the GRESB Real Estate Assessment. But there’s always room for improvement, says GRESB.
This year, GRESB assessed a record 1,005 property companies, real estate investment trusts, funds and developers with 100,000 assets worth $6 trillion.
Real estate companies and funds in Oceania – Australia and New Zealand – continue to lead the world in sustainability performance.
Our region consolidated its lead with a score of 81 – nine points higher than the global average of 72. Asia and America both scored an average of 72 points, with Europe closely behind at 71.
Notably, more than half of the GRESB portfolios with the highest five-star rating are located in Australia and New Zealand.
The Property Council’s chief executive Ken Morrison says the results demonstrate that “our industry is taking the initiative on ESG in ways that lead the world and not merely sitting back waiting for government action”.
The Green Building Council’s chief executive officer Davina Rooney applauds Australian leadership and the companies that “have continued to innovate, to work even harder and to achieve even better results.”
GRESB’s global leaders include Lendlease, Dexus, Frasers Property Australia, Goodman Group and Stockland. Sekisui House achieved Asian regional sector leader status.
Notably, more than half of the GRESB portfolios with the highest five-star rating are located in Australia and New Zealand.
Scott Mosely, managing director of Lendlease Funds Management Australia says tenants are “actively seeking out workplaces that are aligned with their sustainability credentials, which in turn helps them attract and retain the best people”.
According to Dexus CEO Darren Steinberg, his company’s “strong sustainability performance” helps to “manage risk and generate long-term value for Dexus and our third party capital partners”.
Frasers Property Australia’s CEO Rod Fehring says his company is proud of eight years of “year of year-on-year improvement”, but admits “there is also more work to be done”.
Globally, listed property companies still outperform the private sector, but GRESB says this gap is now “negligible” when compared to previous years. Similarly, while average GRESB scores for offices continue to outperform other property types, the other sectors are closing in.
The benchmark reveals global and regional insights and tracks the performance of the real estate industry against key national and policy goals such as the United Nations Sustainable Development Goals, the Paris Climate Agreement, and the net-zero targets laid down by the World Green Building Council.
But there are areas where more improvements are needed, and Morrison acknowledges there is “no room for complacency”.
Global like-for-like emissions fell by 2.66 per cent in 2019 – a lower rate than the 4.91 per cent reduction achieved in the previous year. This slower reduction rate will not be enough to meet the 1.5-degree target set out by the Paris Climate Agreement.
But GRESB’s director of real estate, Roxana Isaiu is upbeat.
“Even in the face of present challenges, we remain optimistic because of the breadth and depth of the sustainability ecosystem that has grown up since the inaugural Real Estate Assessment in 2009.”