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Investing

NEW RESEARCH REVEALS TWO THIRDS OF COMMERCIAL REAL ESTATE ASSET MANAGERS ARE INVESTING 7-10% OF AUM VALUE TO ASSESS ESG PERFORMANCE

NEW RESEARCH REVEALS TWO THIRDS OF COMMERCIAL REAL ESTATE ASSET MANAGERS ARE INVESTING 7-10% OF AUM VALUE TO ASSESS ESG PERFORMANCE 1

ESG Strategy important to managing financial risk

Almost two thirds (63%) of European commercial real estate asset management firms are investing the equivalent of 7-10% of the value of their assets under management in due diligence to help them understand the ESG performance of their commercial property portfolios as they strive to meet net zero targets, while benefiting from the enhanced value of ‘green’ buildings.

This is according to new research by Deepki, the ESG data intelligence firm, which surveyed 250 European commercial real estate asset managers* in the UK, Germany, France, Spain and Italy. The majority (70%) of respondents work for an institution with over £0.5 billion in AUM.

The significant investment being made in understanding how assets are performing is also reflected by the majority (78%) of asset management professionals who believe their organisation is investing enough to improve ESG performance. However, 18% did not think this was the case.

One fifth (21%) felt that their organisation lacks the internal expertise to assess their assets’ ESG performance and develop a net zero strategy. This is despite widespread recognition of the importance of a comprehensive ESG strategy, with the majority (80%) saying that a comprehensive ESG strategy is important when it comes to managing financial risk in their organisations.

Asset managers are taking steps to tackle the expertise deficit in the following ways:

  • 77% are training employees to improve their ESG expertise;
  • 75% are working with specialist ESG consultancies;
  • 38% are making ESG a board level and investment committee priority;
  • 30% are recruiting ESG data analysts.

Commenting on the research findings, Vincent Bryant, CEO and co-founder of Deepki, said:

“It is clear that asset managers are taking ESG extremely seriously and are prepared to make significant investments to get on a path to net zero and manage financial risk. However, it is a complex task and requires significant expertise, particularly when it comes to due diligence and collecting the right data. As the saying goes, if you can’t measure something, you can’t understand it. If you can’t understand it, you can’t control it.”

Deepki is the only company in the world offering a fully populated ESG data intelligence platform to help commercial real estate investors, owners and managers improve the ESG performance of their real estate assets, and in the process enhance their value.

The SaaS platform enables clients to collect ESG data, get a comprehensive overview of their portfolio’s ESG performance, establish investment plans to reach net zero, and assess results.  It also allows users to report to key stakeholders. The platform is supported by carbon and ESG experts who partner with clients across data collection and analysis, through to ESG strategy definition and implementation.

Now with over 300 employees, five offices across Europe and operating in over 41 countries, Deepki has become the global leader in ESG and data intelligence solutions for the environmental transition in the commercial real estate sector, with more than 500 million m² – almost five times the area of Paris – under management.

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