GRESB are publishing their Pre-Release of the Real Estate Assessment and Real Estate Developer Assessment on February 15th this year. This is the first opportunity to view the new 2018 assessment and see what lies in store for those submitting their data.
Here is a summary of the key updates and changes for consideration before the assessment portal opens on April 1st. We have explored what these mean for participants and the wider real estate industry. The most significant developments include:
- Greater levels of scrutiny will be applied to all participants’ supporting evidence, with key questions being subject to enhanced checking as opposed to a selection of participants in previous years. The intention of this change to ‘Validation Plus’ is that this will improve the accuracy of participants’ assessment outcomes and produce a better-quality dataset. This change reassures investors that they are being provided with reliable data when screening for real estate assets.
- In the past, participants have requested greater transparency from GRESB on the scoring methodology. This year GRESB will Publish the 2017 Real Estate Scoring Document. This enables participants to understand what ESG strategies they would need to implement themselves in order to score more favourably in the GRESB Assessment. It would also give participants an indicator of how to respond to assessment questions which would provide more consistent reports across the various participants.
- Greater detail will be requested regarding building certifications, specifically requiring participants to identify the building certification level achieved. Whilst not currently used for scoring, this information is intended to provide better detail about building performance and contribute to improving the building certifications database held by GRESB.
- Participants will need to define the size of their ‘Like-For-Like’ (LFL) scope as this allows potential investors to compare this data to their other investments and judge how this investment would perform within its portfolio. It is anticipated that this level of information should already be known by participants, therefore not adding reporting burden.
- For the first time, reporting of Scope 3 greenhouse gas emissions becomes mandatory. These are all emissions produced indirectly due to a participant’s activities, such as a waste disposal and purchasing goods. This presents a significant challenge to organisations with complex portfolios and supply chains, therefore consideration of measuring Scope 3 emissions demonstrates a forward-thinking company, especially as they are particularly hard to measure. Speak to us about our experience with measuring Scope 3 emissions.
- 2018 marks the last year that Health & Well-being is a voluntary separate module, with a subset of the H&W indicators potentially being integrated into the 2019 assessment. This reflects the ongoing trend that health and well-being is becoming increasingly important in real estate, thus a larger influence is being placed on its role in the decisions made by investors.
- Reflecting another emerging ESG trend, a voluntary Resilience Module is being introduced for the 2018 Assessment cycle. Greengage held a breakfast workshop discussing delivering ESG in real estate and identified ‘long term resilience’ as a key aspect to be considered by developers and asset owners. Understanding potential climate impacts and knowing how to adapt to and mitigate against them provides investors with greater certainty over the long term risk posed to their investments.