Our commitment to sustainable property investment and management

Carbon emissions targets and environmental considerations are leading priorities for us as investors and real estate managers. Environmental, social and governance (ESG) considerations play a significant part in the fundamental analysis process we use to create risk-adjusted returns for our investors.

Our immediate and longer-term ESG goals are to ensure all of the buildings in our portfolio are carbon emission-free. This includes making improvements to our existing stock of buildings to bring these into line with net-zero carbon emissions targets by 2050. We expect accelerating technological developments will change the ways existing properties need to be redeveloped in terms of climate change risk and are proactively developing methodologies to implement these speedily.

Our careful attention to health, environmental and energy-efficiency considerations ensures all of our properties are inherently more attractive and beneficial to the tenants. This approach also adds value by reducing operational running costs, which in turn results in higher returns for our investors.

Our promise is to make every property we own as environmentally efficient and economically viable as possible in order to add value, both for our tenants and our investors.

As part of the East Capital Group, East Capital Real Estate's ambition is to realise the group's investment philosophy by embedding sound ESG principles and processes across all of our investment strategies

Since inception, we have set out be a long-term, active and responsible investor. We have consistently developed our internal ESG framework to evaluate ESG-related risks and opportunities, making these integral to the investment process.

We strive to be a leader in our markets through demonstrating transparency in all our efforts and initiatives. 

Read more about our approach to sustainable investing here

 

We prefer properties with strong environmental qualities, including those that:

  • are in strategically well-positioned locations, with easy access to public transport

  • display attractive, high-quality interior and exterior design 

  • utilise renewable energy (solar, wind, hydro) and smart construction solutions that require less energy and water use, less waste management and less maintenance.

 

 

The wide diversity in types and ages of buildings in our portfolio demands different approaches for measuring, managing and optimising energy use and reducing carbon emissions.

We seek to source renewable energy solutions for water and energy use wherever possible - for example, by adding solar panels (especially for the logistics parks) or by  implementing heating, ventilation and air conditioning (HVAC) and other automation systems that can help reduce energy use while improving the environment for the tenants.

We ensure our properties' social characteristics take tenants' health, safety and well-being into consideration by assessing all our buildings for air quality, light and sound pollution. We also strive for and value access to sporting and recreational facilities. 

The reduction in operational and maintenance costs not only makes the properties more attractive to tenants, thus reducing turnover, but also translates into higher returns for our investors.



 

A proprietary analysis framework

Our ESG scorecard is applicable to all existing investments, serving as a benchmark against peers or market average and review of required improvements on an ongoing basis. It is also crucial when assessing any new buildings or property acquisitions in terms of understanding material risks and opportunities. 

The properties are assessed in various aspects of the sustainability issues, closely aligned with the UN Sustainable Development Goals. For example, the properties are assessed with regards to energy efficiency, water consumption, waste management, accessibility, ecology and green areas, indoor climate and air quality, noise or light pollution, governance issues etc. The scorecard also includes a Red Flag section, highlighting material ESG topics and any aspects not in line with sustainability goals and best practices. Internal thresholds have been set for the scores and improvement areas are mapped accordingly.

 

 

 







Environmental, Social and Governance (“ESG”) and Sustainability Related Disclosure

Regulation (EU) 2019/2088 of 27 November 2019 on sustainability-related disclosures in the financial services sector, as amended (SFDR) governs the transparency requirements regarding the integration of sustainability risks into investment decisions, the consideration of adverse sustainability impacts and the disclosure of Environment, Social, and Governance (ESG) and sustainability-related information. The investments underlying this financial product do not take into account the EU criteria for environmentally sustainable economic activities.

East Capital Real Estate integrates, among others, environmental, social and/or governance characteristics as part of the due diligence process when selecting investment opportunities.

East Capital Real Estate identifies, analyses and integrates sustainability risks in our investment decision-making process as we consider that this integration could help enhance long-term risk adjusted returns for investors. East Capital Real Estate is of the opinion that unmanaged material sustainability risks and opportunities may influence the current and future position of a company. East Capital Real Estate considers principal adverse impacts derived from sustainability factors throughout the investment process. The identification of principal adverse impacts is a part of the investment universe screening and taken into account when deciding on an investment proposal.


Our Active Ownership Policy specifies how we shall act when exercising the ownership rights in the companies held by these strategies on behalf of our clients, the investors. Additionally, the policy describes how we integrate shareholder engagement in our investment processes, as well as how we exercise voting rights. For more information, please refer to the Active Ownership Policy.

As part of our sustainability work, East Capital Real Estate shall also ensure that the remuneration is consistent with the sustainability work undertaken by East Capital Real Estate and that sustainability aspects shall form part of the evaluation of the employees that serves as a basis for determining remuneration.

 

East Capital Real Estate, as part of East Capital Group, complies with a number of commitments, requirements and guidelines related to sustainability such as the UN PRI and UN Global Compact.