Real estate owners that don’t have published ESG strategies may be missing a big financial opportunity.

A panel discussion at Nareit REIT World 2018 addressed the growing interest and benefits of environment, social, and governance (ESG) criteria for real estate portfolio owners and funds. The panel included Ben Myers, Boston Properties Inc., Dan Egan, Vornado Realty Trust; Sara Neff, Kilroy Realty Corporation and Rick Werber, Host Hotels & Resorts, and the bottom line was clear:

ESG is a good business strategy.

Paladino and Company drives sustainability strategy for REITs and other real estate portfolio owners. Our long-standing collaboration with REITs like FRIT, Vornado, and Forest City have proven that investments in environment, social, and governance has a competitive edge.

• The financial community, including investors and insurers, are more actively engaging with REIT’s that have proactive ESG and resiliency plans for their properties. This is why REITs like FRIT are highlighting awards such as the one awarded by NAIOP DC/MD for Best Sustainability Program.

The panel acknowledged that changing views in the business community are incentivizing REITs to invest in ESG initiatives.

For example, leading technology companies such as Salesforce, Cisco, and HP have publicly announced support for Mission 2020 and will “activate supply chains, influence political and regulatory mechanisms, push each other as peers, partners, and competitors; and enable and inspire our customers to mitigate (climate change)”.

The panel also cited scientific evidence that demonstrates how green building design contributes to greater employee productivity. Companies are looking to house their workforce in buildings that support greater cognitive function, creativity and overall health of their employees. Paladino has used sustainability, biophilic design, and wellness strategies to optimize workforce performance for businesses including PNC, GE, Expedia, and COOKFOX.

Finally, investors and insurers are asking more questions about REIT’s commitments to ESG and resiliency planning for buildings in their portfolios. As a result, the real estate investment community is responding to the growth of impact investors, and ESG investment strategies, and the economic value it provides. Paladino’s e-book, “Resilient Design Strategies for New and Existing Buildings” has been a favorite among REITs that want to address the changing climate.

Additional Resources:

• How about CSR Reporting: The power-buyer trend most REITs aren’t ready for
• Rethink your real estate – climate resilience for new and existing buildings
• The missing piece to all those wellness studies
• How About CSR Reporting: The Power-Buyer Trend Most REITs Aren’t Ready For
• Case study: ICSC Property Efficiency Scorecard

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