Australia’s property industry has strengthened its position as a world-leader on environmental, social and governance (ESG) performance.
The Australian and New Zealand real estate sector has again outperformed other regions in the world’s most trusted sustainability benchmark – the Global ESG Benchmark for real estate assets (GRESB).
For the ninth successive year, the Oceania region has topped the global rankings with Australia and New Zealand achieving an impressive average GRESB Score of 81. This was an increase from 76 in 2018 and well ahead of the global average of 72 (which also improved from 68 the year prior).
The second-highest GRESB score was for Asia (72.67), followed by the Americas (72.05) and Europe (70.68).
Chief Executive of the Property Council of Australia, Ken Morrison, said the newly published results show that Australia’s property industry is taking the initiative on ESG in ways that lead the world and is not merely sitting back waiting for government action.
“The investments that Australian property companies are making in sustainability is supporting the global transition to a low-carbon, more sustainable and more resilient future which is delivering value for investors and meeting the needs of a growing population and economy.”
“However, we know there is more to be done and no room for complacency,” Mr Morrison added.
GRESB’s results are used by more than 100 institutional investors around the world representing US$22 trillion in assets under management.
1,005 property companies, REITs, funds and developers, representing more than USD 4.1 trillion AUM, participated in the 2019 GRESB Assessment.
The assessment scored and benchmarked the ESG performance of 80 real estate funds, companies and developers from Australia and New Zealand with assets valued at US$242 billion.
GRESB’s global leaders for Australia are:
Overall Global Sector Leaders (achieved highest score for its sector)
· Office – Private: Australian Prime Property Fund Commercial, Lendlease
· Retail – Private: Australian Prime Property Fund Retail, Lendlease
· Diversified – Office/Retail – Private: Dexus Wholesale Property Fund, Dexus Property Group
· Developer – Residential: Frasers Property Australia Pty Ltd – Development Assets, Frasers Property Australia Pty Ltd
· Developer – Industrial – Goodman Group (GMG), Goodman Group
Global Sector Leaders (achieved highest score for the combination of nature of ownership and sector)
· Office – Listed: Dexus Office Trust, Dexus Property Group
· Industrial – Listed: Frasers Logistics & Industrial Trust, Frasers Logistics & Industrial Asset Management Pte. Ltd.
· Diversified – Office/Industrial – Private: Frasers Property Australia Pty Ltd – Investment Properties, Frasers Property Australia Pty Ltd
· Diversified – Office/Retail – Listed: Stockland
“The strong performance by Australian property assets in an growing pool of participants is testament to our industry’s commitment to ESG principles and their leadership on energy efficiency, emissions reduction, inclusion and health and wellness which are all increasingly important factors for the global investment marketplace,” Mr Morrison said.
GRESB’s trend analysis outlines the growing importance of these issues for the property industry:
- 98 per cent of participants collected data on energy in 2019, compared to just 19 per cent a decade ago.
- 61 per cent of participants now use renewable energy compared to 13 per cent in 2009.
- In 2012, 26 per cent of participants had sustainability clauses in their contracts, which increased to 86 per cent in 2019.