Health and wellbeing have long been important aspects in lifestyle buyer property choices, but they are also vital issues for the industry.
That’s the view of the Netherlands-based GRESB, the global standard for Environmental, Social and Governance (ESG) assessment of real estate portfolios and infrastructure assets.
Real estate development can serve to create superior places – places that enhance productivity, support physical activity, promote social interaction, provide access to vital services and contribute to happiness, it says.
As interest in health and well-being in the built environment grows, the industry has recognized the need for practical tools for systematic assessment, objective scoring and peer benchmarking of health and well-being.
Dr Chris Pyke, Chief Operating Officer of, GRESB, says, “Over the last year, the topic of health and well-being has rapidly emerged as a ubiquitous issue for the global real estate industry. There is a sense that it is the ‘next big thing’. The question here is why we are talking about this issue and where we go from here.
“We’re talking about health and well-being because the design, construction, and operation of our built environment has a profound impact on individuals and populations. This includes our comfort and productivity, but that is just the beginning.”
GRESB has just launched a new Health & Well-being Module as an optional supplement to the GRESB Real Estate Assessment, which is an annual survey on behalf of a large group of institutional investors that captures information regarding the ESG performance of property companies, fund managers and developers.
The new module evaluates and benchmarks actions by property companies and funds to promote the health and well-being of employees and their strategy to create value through products and services that promote health and well-being for their tenants and customers.
Dr Pyke says, “The design, construction and operation of our built environment has a profound impact on individuals and populations.
“GRESB’s vision is to ultimately create better places for people and communities – places that reduce environmental impacts, improve social practices and set high standards for corporate governance – in profitable ways that make good business sense and reward innovation.
“This new Health & Well-Being Module adds an additional component to the annual GRESB Assessment and sends a signal that human health and well-being plays a critical role in assessing the value of real estate portfolios and other assets.”
The GRESB Health & Well-being Module includes 10 new indicators providing investors and property companies and funds with new insights on leadership, needs assessment, implementation action and performance monitoring.
The module has two primary areas of focus: the promotion of health and well-being for employees and the provision of products and services that help promote health and well-being for tenants and other customers. This parallel focus allows investors and property companies and funds to differentiate action to benefit internal operations (employees) from value-creating products and services offered to others.
Dr Matt Trowbridge, Associate Professor, Associate Research Director, Department of Public Health, University of Virginia School of Medicine, says, “The GRESB Health & Well-being Module will make real estate companies and funds more transparent and make comparative information more accessible and actionable for investors. This represents an important step toward resolving long-standing market failures and making health an investible attribute of real estate.”
The group’s 2015 GRESB Report provides many new insights on global issues in sustainability, energy, and real estate, including key findings, research highlights, and innovation case studies provided by leading property companies and fund managers.
“Expectations are changing rapidly in the global property industry. Investors, owners, tenants, regulators and other stakeholders are asking for greater levels of transparency in general, and specifically with respect to environmental, social, and governance (ESG) issues,” say industry chiefs involved in the report.
“This trend is fueling demand for disclosure and information on the sustainability performance of property companies and fund managers. An increasing number of investors now incorporate such information directly into their investment processes and strategies.
“This year we saw the publication of another set of independent studies linking ESG issues with financial returns – suggesting that fiduciary duty and robust management of ESG matters reinforce each other in the real estate sector.”
This convergence of factors encourages market participants to better understand sustainability risks and discover new opportunities to create value for shareholders, customers and society, they say.
“As leaders in the global real estate industry, we recognize GRESB’s central role in this transformation and encourage our constituents to participate in the annual GRESB assessment. This report summarizes the 2015 GRESB assessment results and provides unique insights into sustainability practices across the global property industry.
“In reviewing this year’s findings, we are impressed by the work of our members toward better ESG management. Activities include setting clear goals, taking coordinated action, expanding impact monitoring and improving sustainability performance.
“Overall, we believe the 2015 GRESB Report underlines that the real estate sector provides practical solutions to our most pressing challenges. We can create better places for people and communities – places that reduce environmental impacts, improve social practices, and set high standards for corporate governance. Importantly, as an industry, we can do this in ways that make business sense and reward innovation.”
Despite this success, the journey of the property industry towards better ESG performance and reporting has only just begun, they believe.
“The industry has a vast and growing environmental footprint. Its large share of total global resource consumption continues to attract attention from local and national regulators, notably including mandates for transparency in building energy performance and more aggressive building codes. The industry has begun to appreciate the role of property in emerging issues such as occupant well-being, public health, and resilience. In the years ahead, the industry will be challenged to continue to not just understand, but also to demonstrably address the impacts and opportunities of these emerging topics.”
The post Why health and well-being matter to the global property sector appeared first on OPP.Today.