Read our position paper.
Why buildings and real estate matters: Buildings drive ~40% of global energy use and ~30% of energy-related GHGs; upgrades can cut emissions and lift asset value (price premia, lower default risk/volatility). REITs own a large slice of this stock, and—being public—are influenceable; value levers are efficiency (lower OpEx) and healthier, certified buildings (higher rents/values).
Sustainability Metrics Material to Real Estate: Positive/negative screens across sustainability dimensions (environmental, social, governance). Key metrics include annual energy/GHG intensity reduction, green building certifications, tenant engagement, urbanism. We exclude controversies, private prison REITs, material fines, weak climate-risk management.
Portfolio Construction: Start with global listed REITs; apply size/liquidity/leverage filters; market-cap weighted to minimize costs and manage tracking error. Re-evaluate annually and rebalance tax-efficiently.
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