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Roundtable: the “gap” between real asset valuations and investment value

In March, EVORA Insights’ fourth roundtable focused on integrating climate risk into real estate asset valuation and assessing investment value. The discussion was more diverse than just technical adjustments to acquisition models and IC memos.

Our clients’ focus on achieving actual net mitigation and adaptation, rather than simply de-risking an investment or portfolio, was striking.

In all, it seems that many firms are incorporating climate risks and opportunities into their investment process, but with little consistency in how it’s actually quantified or whether it’s formally embedded into valuation models.

Value vs. Price

A distinction was made between traditional valuation methods that the valuation/appraisal community use, and pricing in the context of transactions.

In the former case, few if any valuers are incorporating climate risk into property valuations. Aside from perhaps EPC ratings where relevant policy is in place; little to none when it comes to other forward-looking climate risks.  

In the case of transactions, some actors are adjusting their pricing. An ongoing challenge is whether those climate risk-adjusted prices actually win deals, when there are still willing buyers who do not account for climate risk. This was noted as especially challenging in hot sectors and markets (i.e. industrial).

Integrating future risk into acquisition models

There is anecdotal evidence of investment managers making adjustments to various inputs and assumptions in acquisition models to price in climate risk.

One method is to budget for additional CapEx for decarbonisation or adaptation measures, depending how much is needed by the asset and how ambitious a fund’s goals are.

Other methods noted include adjusting Cap Rates (particularly on exit) as a proxy for risk, or establishing specific investment criteria (i.e. red lines).

Data and transparency

These are key tools to pricing climate risk, but are cited as an common challenge. The specific data concerns vary across physical vs. transition risks, as well as geographies.

When it comes to estimating physical risks, many of the leading third-party tools and methodologies focus exclusively on direct damage to buildings, often captured in insurance claim data. But this can exclude potentially material impacts to utility expenses from more extreme temperatures, rising insurance premiums, disrupted access to buildings or tenant discomfort, and all of the broader market-level impacts of increasing climate hazards in a given city or region.

On the transition risk side, data concerns centered around how incomplete the carbon performance story is for most buildings. In Europe, Scope 3 emissions data is unsurprisingly a major thorn, and EPC ratings do not paint a picture of an asset’s actual performance. New regulations in France do appear to be making energy and carbon data from buildings more transparent.

Interestingly, the U.S. seems to be ahead in terms of accessing tenant data and historical carbon performance of many assets, largely due to landlords paying for the main meters and recharging tenants plus the mandatory energy benchmarking regulations established by most major cities and counties.

The ubiquity of the ENERGY STAR Portfolio Manager tool’s usage in the commercial real estate space was cited as an advantage – buyers can often request a download of the building’s actual energy, carbon, and water performance from the seller, avoiding the need to guestimate its performance.

The notion of a digital ESG passport that sticks with an asset throughout its life-cycle and captures much of what an ENERGY STAR download would include (plus embodied carbon information, in an ideal world) could be a key to appropriate valuation.

Another risk category was cited as critical to consider at the fund and house level: reputational risk. Even if climate risk-adjusted pricing hasn’t reached a tipping point in the markets yet, firms and funds are considering the consequences of continuing business-as-usual investment strategies. Greenwashing is considered a material risk now, particularly in light of the SFDR and new climate disclosure rules from the FCA and SEC.

Policy gaps

The gap between the policy / market realities and the science-based targets was brought up, indicating that markets are not yet reflecting the risks to a timely and orderly transition. Some expressed a belief that legislation was the only way to drive that change by levelling the playing field between competitors as well as opening up access to tenant data. Otherwise, how will pricing adjustments for transition-readiness take hold?

Frameworks such as the TCFD recommendations are encouraging development of the financial quantifications of climate risks, but provide little practical guidance on how to do so by sector.

However, this type of industry collaboration was seen as a positive example of how this agenda could be progressed effectively. As long as it doesn’t duplicate existing initiatives from industry bodies like the BBP and INREV.

Investment strategy and time matters

There remains some hope that, even without strong legislation, institutional investors will be seeking Core assets that are already well on the path to Net Zero, and will be willing to pay more for lower carbon buildings. This can help justify Value-add investments in decarbonisation measures by current owners in anticipation of the sale and potentially adjusted pricing in the future.  In contrast, tenants were not seen to be moving the needle via demand for greener buildings, despite hopes that they would and corporate occupiers’ climate commitments to the contrary. This presents a challenge to underwriting investment in these properties today.

When thinking about longer term risks, a fund with an average holding period of five or six years may coast by just fine without adjusting their approach. However, there is recognition that climate risk awareness and data quality is increasing, and buyers in just a few years’ time may have new demands that could result in depreciation and reduced liquidity.

If the role of Value-Add funds today is to prepare assets for acquisition by Core investors in the future, climate risk (particularly Net Zero readiness) will need to be considered in the investment plan. Many of these considerations — achieving NZC, establishing an internal carbon price, adapting to hotter temperatures, etc. – may be different for REITs than for fund managers of third party assets.

What is a “green asset,” anyway? 

Standards overkill was cited as a distraction from getting real decarbonisation work done. Divergence in definitions of a “green” asset across dozens of certification schemes results in inconsistencies among owners, and muddies the ability to answer this question for standards such as SFDR.

Often these standards obscure the actual performance of a building and the related risks.

In summary

  • Work is being done to integrate climate risk into pricing and investment decision making, with varying degrees of sophistication.
  • The most common levers for integration include CapEx, Cap Rates, and investment boundaries.
  • While investment teams are beginning to upskill on the subject, actual methods of integrating into acquisition models differ significantly. Hesitation persists when it comes to “putting your money where your mouth is,” for fear of reducing competitiveness.
  • More complete data and projections on climate risk are needed to establish consistency in pricing.
  • Legislation may be key in driving this forward. However, the number of standards, frameworks, and reporting requirements are already burdensome.
  • Investment strategies, market cycles, and other structural trends make a difference.

It’s clear there is a great deal of work left to do. It was heartening, though, that almost every strand of this discussion came back to actual impact and progress toward Net Zero Carbon goals. At least for this group of peers (which admittedly has some selection bias), double materiality is top of mind.

Software as the foundation for investment grade data (IGD)

ESG is here to stay. Momentum is gaining to improve data quality and consistency. Regulations such as Sustainable Finance Disclosure Regulation (SFDR) are clearly helping to drive this. The perceived distinction between financial and non-financial data is not helpful one when ESG data, which might conventionally be seen as non-financial, is used all the time to inform investment decisions.

Clearly those who are managing data for ESG strategy implementation and reporting rightly need to focus on aspects, which London Stock Exchange highlighted, such as:

  • Reporting boundaries: ensuring data aligns to the fiscal timeframes and financial structure
  • Comparability and consistency: employing best practice in terms of methodologies
  • Provision of data: qualitative and quantitative for vital context and narrative.
  • External assurance: adding credibility to ESG reporting by following the principles of an independent auditing of the process.
  • Accuracy: establishing robust systems to bolster the collection and quality of ESG data.

Historically there’s been underinvestment in the systems and processes in the real estate sector to address data accuracy and quality. This can be said in relation to the adoption of technology but also from a resources and experience perspective. The requirements and expectations of ESG reporting in real estate has evolved rapidly and perhaps faster than the pace many companies are going at to address these gaps. Key to success in this is engaging those involved in the foundations of ESG data and with the tools like SIERA and SIERA+.

Take for example Net Zero Carbon (NZC) as a relevant ESG theme. Many real estate companies have made public commitments to reaching NZC by 2050. NZC is now firmly on the radar of Asset and Investment managers who are getting their heads around a new lexicon and learning how they begin to develop asset business plans and investment strategies that mitigate these transition risks.

A necessary first step is to get a baseline of performance to understand the current energy and carbon intensity of assets and funds/portfolios and what the impact of current action plans will be on NZC pathways.

To achieve this companies must get the fundamentals right in terms of having visibility of and centralising information to answer some key questions: where are the gaps in data coverage?, which are the best and worst performers in the portfolio?, What’s the current status of asset action plans?, Where in the portfolio should action be prioritised for improvement on each of these?

Example Portfolio dashboard, SIERA+

Undoubtedly technology plays an essential role here as a tool to drive efficiency and consistency in the data collection process and to centralise that data. However, ultimately this comes down to providing an easy and simple means of engagement and collaboration between Asset & Investment management and Property Managers.

We have developed SIERA+ to better equip property managers in engaging with ESG and addressed the priority needs; provide a simple view on performance against targets, ability to manage data quality and keep on top of actions. Notifications prompt when action is required and it’s generally set up to let users focus on the most material issues.

Example Action Plan dashboard, SIERA+

We also recognise that the culture of Property Managers can vary across diverse portfolios and English is not always the first language. Since this is about improving engagement we have made SIERA+ available in 5 languages.

Get in touch to know more.

GRESB + SIERA = Success

Sustainability data can be complex. It can show many interesting patterns and insightful trends about energy usage, but at the same time be hard to manage.  The ability to use sustainability data to reduce energy usage by seeing the impact of actions is one of its most powerful features. Connecting those patterns and trends to actions leads to results.

GRESB provides a way of thinking about sustainability data which focuses effort on certain areas and types of energy consumption. SIERA is the sustainability software solution by EVORA for managing asset portfolio data to help achieve sustainability goals. SIERA provides a way of seeing those areas and types of energy consumption by organising consumption, meters, properties, and funds to make it easier to understand. That’s why EVORA sustainability consultants use it get the best out of the data, and easily see patterns which otherwise would be hidden.

But GRESB provides its own challenges. Submitting data to GRESB involves making sure the data is correct, accurate and above all reflects the performance of a property and ultimately a portfolio.

GRESB can be challenging to get right

For those who submit to GRESB, there’s a lot of data to prepare – a lot of ducks to get into rows if you will. One of the first hurdles is making sure that your asset data is correct, that floor areas add up correctly and that the consumption, waste or emissions make sense to GRESB. There’s wide range of categories and ownership to consider, and things like where emissions are generated and who consumes them.

In short, it can easily become somewhat of a mountain of information to organise. GRESB provide a website and a spreadsheet you can use to upload data. The website points out where things don’t add up correctly and you work through the errors until they’re all gone.

GRESB also provides the ability to use software to upload your data. This method is very similar to the website except errors are sent to the software instead of the GRESB webpage. SIERA uses this method to direct the wealth of asset data it contains about assets in the portfolios and funds managed by EVORA consultants.

This connection means SIERA can take advantage of its own intelligence to make it easier to prepare for GRESB.

SIERA makes things clearer

SIERA is a platform whose main aim is to make sustainability data more manageable and the intelligence within it easier to see. It shines at tasks like GRESB mainly because it already contains a lot of the data required for a GRESB submission. SIERA uses this data to show the patterns, monitor the impact of actions and to look for potential improvements.

SIERA has a wide range of different ways of showing the data, each taking a different slice of the data to show a pattern. Having so many different views on the data makes it much easier to understand the data which gets sent to GRESB.

Asset-level reporting becomes easy

This year GRESB changed how data is reported. Before it was fund-level, meaning the total consumption and usage of all assets in a fund was submitted. This year it became asset-level. This means the energy and performance of each individual asset is submitted. As you can imagine, this means much more detail is needed and a finer grain of accuracy than before.

Luckily for SIERA users this didn’t pose a problem. SIERA already recorded data at the meter level so this change didn’t cause a problem.

Qualitative survey answers add colour

GRESB doesn’t just focus on utility readings. It also asks a range of questions about the social initiatives, engagements and technical assessments done for each asset. This qualitative data helps to show how a building is being managed and what social programs are taking place to increase the sustainability of an asset.

SIERA captures this data using surveys. SIERA surveys capture exactly the qualitative data that GRESB asks about. Surveys can be sent out to building and property managers for each asset and contain a range of questions about the asset and its management.

SIERA automatically prepares the answers for the GRESB questions which focus on the building management. Where it can, SIERA also uses data it already has to save time for anyone submitting data to GRESB. For example, rather than ask every property manager if a building uses automatic meter readings, SIERA simply looks at the meters in the asset and checks itself.

No GRESB errors doesn’t always mean correct

Once the asset data has been checked for any updates, SIERA displays the whole GRESB submission in one page. This table makes errors or unexpected variances stand out so you can quickly correct any potential mistakes.

EVORA consultants use SIERA to prepare submissions for clients. On top of that, because they’re experts in their field, they use it to see where adjustments might be necessary.

GRESB show where data doesn’t add up using errors and outliers. This helps to make sure data like floor area coverage is correct, but it doesn’t highlight poorly organised data. EVORA consultants know to look for variances which may indicate problems like consumption data that has been incorrectly allocated to the wrong area of the building.

EVORA uses SIERA to achieve higher GRESB scores

Using these SIERA features make GRESB easier to get right, but they also make it easier to get higher scores. EVORA consultants use the fine-grain control of SIERA and the data visualisations and views to get the most out of the data, and correct issues before they get to GRESB.

Whilst other sustainability software can also prepare submissions for GRESB, SIERA ensures that the data is both in its best form, and used to get real results. Once the GRESB period is over EVORA consultants use the data to feedback to clients to help guide which actions will achieve an asset’s sustainability goals.

This combination of EVORA + SIERA explains how EVORA helped a number of our clients achieve GRESB global sector leadership and Hines Europe to achieve 100% in its Resilience score.

If you are interested in finding out more, get in touch with the team at contactus@evoraglobal.com.

Communicating COVID-19 impacts through Sustainability Reporting

With market uncertainty pervasive and belief in business deteriorating, using the annual sustainability report to restore confidence with all stakeholders is more important than ever.

Your next report will need to provide a clear, trustworthy narrative, detailing specific insights on how the pandemic has impacted on your sustainability strategy, business model, risks and stakeholder commitments.

Sustainability frameworks enable companies to provide reasonably comparable and useful information. However, no such template exists to compare how companies have responded to COVID-19.

EVORA have been making in-roads in accounting for the COVID crisis in our reporting for clients since March, learning more with each report, and share key areas below to consider during your next round of reporting:

1) Controlling the content

COVID-19 has impacted people in many ways. Employees may have experienced challenges adapting to a new way of working; property managers dealing with a whole new set of procedures and protocols to follow; tenants juggling the ‘return to work’ safely and local communities may have experienced unexpected environmental and social impacts.

By including a COVID-19 one-off section in the report; the opportunity may be missed to communicate the impacts of the pandemic in a more nuanced way, tailored to the different stakeholders affected. Instead, it will be more authentic weaved in specific messaging throughout the sustainability reporting, where relevant, through the voice of the affected stakeholder, for example a direct quote from an employee or a tenant.

We also encourage the simplification of the message – avoiding jargon, cliches and overly technical language, and, instead, using straight-forward, clear and concise language.

2) Mapping what is material

Materiality assessments inform meaningful sustainability communications, enabling companies to identify sustainability issues that are important to both their stakeholders and to business success. Used to their full potential they can help shape company strategy, galvanise internal functions and gain senior buy-in, as well as uniting disparate teams and processes.

As society deals with the pandemic, materiality assessments should be reassessed to better integrate sustainability into business strategy and to explore the relationship between a company’s impacts on a sustainability issue and the impact of that issue on the business. 

3) Dealing with the data

The shift to homeworking presents a unique challenge. Companies will be demonstrating a reduction in Scope 1 and 2 greenhouse gas emissions in line with the reduction of office building energy consumption.

This presents several possible issues for the reporting company:

  • Any movement in reported emissions could mask the impacts of any genuine reduction activities
  • Distortion against targets set
  • Justification may be required for smaller energy reductions than others in the sector, or anticipated, because they have seen a lesser impact from the pandemic, for instance through keeping offices open, with higher ventilation requirements, rather than closing buildings completely.
  • Emissions have not been eliminated, rather they have been relocated to employee homes beyond the company’s direct control. Some might argue that the decrease in commuting related emissions makes up for this. In order to provide a credible comparison of year on year performance, quantifiable homeworking emissions should be considered for recognition.

Our initial response is to always explain data with fully contextualised narrative.

4) Shift to online-first

We recommend an online-first approach for corporate sustainability reporting. This enables the audience to more easily search, navigate and locate information. This format can enhance storytelling – enabling more in-depth features and linking direct to other relevant documents.


Stakeholder scrutiny of how organisations are responding to the COVID-19 pandemic is bringing heightened attention to the importance of corporate transparency on sustainability issues. EVORA design reporting strategies for organisations, enabling them to apply frameworks, communicate meaningful sustainability outcomes and impacts to key stakeholders and use reporting as a tool to improve sustainability performance. Get in touch with the EVORA reporting team today.

PropTech: A Real Estate (R)Evolution

Back the 1980’s I was co-founder of a software company, which specialised in creating systems for the (then) new generation of PC’s. Myself and my colleagues had learned our programming skills whilst studying for PhDs using massive mainframe computer systems with clunky user interfaces and torturously slow software development cycles. We seized upon the new generation of “Micro Computers” that had emerged in the 1980s and new software tools that let us develop systems far quicker.

We started to develop software for the commercial real estate market, creating a system that allowed agents to match client requirements against a database of available property. We created a centralised service to compile the database of property and distributed it by electronic bulletin board. Fairly rapidly, we had all of the major agents using our system with over 100 clients.


This was before the internet. In short, we had used technology to disrupt an industry, revolutionised the distribution of information, automated manual processes and consolidated effort. I guess these days we would have beards and drink flat whites in some trendy loft studio near Old Street.

30 years ago PropTech was confined to the primal needs of the commercial real estate world, namely managing the process of finding tenants or a suitable property, managing the process of rent and services charge, and valuing the property. And that was about it.

These processes remain core to the PropTech offerings that are currently on the market and over the years they have been augmented by new technologies, but we have not necessarily seen disruptive change. The advent of the Internet in the 90s bought about huge changes in the way that property could be marketed, but, did this really shake the residential and commercial agency markets? New technological developments are bringing new products to the market but will we see further ‘disruption’?

Let’s examine the potential for change.

EVORA Global Proptech in Real Estate


Virtual and augmented reality

This technology certainly has the potential to enhance and quicken the design process, allowing the client to get closer to what their space will could look and feel like. Certainly, this technology will impact the way that architects and designers work with their clients, reducing the cycle time from concept to finished product.

However, in reality, is this tech making an existing process more efficient rather that creating a new model?

Internet of Things (IoT)

IoT has the potential to enhance the way that we monitor and control space. It’s noticeable that some BMS vendors are now rebranding as IoT vendors. Closer control and monitoring will enable more cost efficient and environmentally sustainable use of our workspaces. As suggested this technology is already disrupting the BMS market, causing established vendors to shift their stance as new players start to infiltrate their market with new platforms that allow monitoring and control of workspace use, CO2 levels, basic energy use and focussing on a ‘Wellbeing’ agenda.

IoT has the potential to also produce lots of Big Data, but what does that mean?

Big Data

The potential for Big Data within real estate is enormous. At a micro scale, looking at data from IoT sensors and BMS and meter data and also on a macro scale, analysing value trends etc.

But, as Dan Areley of Duke University said:
Big data is like teenage sex: everyone talks about it, nobody really knows how to do it, everyone thinks everyone else is doing it, so everyone claims they are doing it…

There is the potential for Big Data to extract nuance and understanding from complex systems. In real estate terms, to be able to identify how factors such as weather, occupancy and footfall can impact on cost and environmental impact.

The issue with Big Data is that by its very nature, it is big. So big that conventional Business Intelligence tools cannot really cope with the sheer volumes that are in play and the complexity of the relationships between the data. The potential for disruption through enhanced insight is always possible but, with current tech, unlikely.

But there is hope, in the form of AI/Machine Learning, how would this look for the Real Estate industry?

Artificial Intelligence (AI)/Machine Learning

AI/Machine Learning is the new kid on the analytics block and is the key to unlocking the value of the Big Data that could disrupt many aspects of the real estate world, such as valuations, sustainability, planning and market analysis.

The driver behind AI/Machine Learning is Data Science, a whole different approach to analytics. It is not so much about the evolution of Business Intelligence (BI), but more of a completely new approach, a new species.

[clickToTweet tweet=”Data Science offers the opportunity for discovering new questions to be answered and takes the approach of statistically analysing the data, so that the relationships between the different data types can be articulated as a model.” quote=”Data Science offers the opportunity for discovering new questions to be answered and takes the approach of statistically analysing the data, so that the relationships between the different data types can be articulated as a model.”]

BI is about KPIs, charts and answering questions that we knew – in very crude terms – sorting, grouping, charting and comparing data that exists in regular structures. Data Science offers the opportunity for discovering new questions to be answered and takes the approach of statistically analysing the data, so that the relationships between the different data types can be articulated as a model. As that model becomes refined and perfected that gives us the intriguing possibility of prediction.

DAaaS – Data Analytics As A Service

Data Science isn’t new, it has been around for around 30 years and arguably, has been driven forward more recently by faster processing, high capacity storage. This is now manifesting itself as DAaaS – Data Analytics as a Service. Cloud providers such as Amazon Web Services and Microsoft Azure are offering storage, data handling and modeling tools to provide the possibility of creating predictive analysis opportunities based on our own data. However, these tools require new skills in our teams, Data Scientists to create the models that we need.

So don’t be surprised to see service providers and end users on the real estate market recruiting and training Data Scientists, which will lead to the creation of value from Big Data. This value, in terms of strategic and operations advice will in turn reveal The Big Answers and also The Big Questions.

Blockchain

Whereas Big Data is a fairly easily understood concept, Blockchain causes a few difficulties. Firstly, what is Blockchain and, secondly, how could impact the real estate world and, in particular, the sustainability agenda?

Blockchain originated back in 2008 as a digital ledger that provides a way of encrypting and providing transparency for cryptocurrency transactions. More recently, it being seen as a way of encrypting transactions between parties in such a way as to provide total transparency and auditability. In the real estate world, this could be used to encapsulate lease transactions, rent payments and rent review agreements. If we extend our crystal ball into the sustainability world then we could see Blockchains between utility companies and consumers, providing investment strength data with regards to energy consumption.


EVORA can help you capture your building data with SIERA Sustainability Software. Contact Us for a demo.

Working Smart, Working Fast: How Agile development and UX design are at the heart of SIERA

Software is one of the greatest tools of the modern world, providing us with a variety of options for any job we have at hand. When you use a software product, you want it to help you with your task as seamlessly as possible, and to address the major struggles faced. You can then focus your efforts on the task at hand, rather than the tool which is supposed to be helping you with that task.

We are all consumers of software and appreciate good UX design (User Experience) when we see it. I am sure some of us here are quite fond of unlocking our phones using our fingerprint rather than the classic 4-digit code. It makes our tasks simpler, quicker and easier.

A good tool though, comes from putting a lot of thought and effort into making it as intuitive as possible. It is through Agile Development and careful User Experience design that we shape our software product, SIERA.

SIERA LOGO WEB LANDSCAPE

Read: 110 seconds to understand how SIERA Sustainability Software can help you


Agile Development

As part of developments within the industry, and the ways we work always growing and developing, SIERA is designed in a responsive and agile format, this is called Agile Development. Though we use an overall roadmap, the team works in such a way that we can adapt areas of our time, projects, workflow and focus, to match business and client needs. Working in two-week sprints, we open the discussion for any necessary changes to project or scope, and the opportunity to reflect on current workflow practices and focus areas, adapt them, or suggest improvements as a team where needed. A team will always be growing and developing.

[clickToTweet tweet=”@SIERAsoftware is designed in a responsive and agile format, this is called Agile Development. ” quote=”SIERA is designed in a responsive and agile format, this is called Agile Development. “]

User Experience Design

Through the entire process, User Experience design plays a part amongst every area of the team, and is done by every member of the team. A software team should always have at least one member who has UX (User Experience) design as part of their job role (that’s me), a person who has the time and skills to carefully think through UX design and how this is implemented into the system. However, it is not only down to that person, every member of the team and business should have the opportunity to contribute to how things should be built and experienced, as this brings in a pool of thoughts built upon the years of expertise each team member has built up.

Discussions should be live through the entire development of a piece of software, everyone is involved early on at the inception of a piece of development or new addition to the software, and then, though the design and specification should be set early on, anyone can share their thoughts throughout the process.

This will then form together a much more well-rounded, robust and effective tool.

EVORA Global SIERA Asset Electricity profile

A fresh pair of eyes

And so, it is often very useful to get a fresh pair of eyes, when someone else looks at the same tool as you, you will often find they view it from different perspectives. As Quality Assurance Tester on SIERA, and UX Designer, I can spend a lot of time staring at SIERA, and in many ways, get used to the way it is and how it functions, so when something could be improved, as is always the case with software, it becomes less noticeable. As to me, that’s just the way it is. That is where a fresh pair of eyes is key, though I can still view the product from a good perspective, I can’t see everything, and have often found that other members of the team will raise new ideas and thoughts on the current work flows, which is amazing. A UX designer should never be left alone.

We can’t do everything, but we CAN do everything we need to… (being realistic)

We can’t do absolutely everything in life, and we all know that, but we can do everything we need to. Well with software development it’s the same. We don’t have time to implement every idea we ever think of, because it’s simply impossible, however through being realistic and honest with our time, and careful thought and prioritisation, we can achieve everything we need to; first usually as an MVP…

I hear the term MVP a lot, so what is an MVP? An MVP is a Minimum Viable Product, this is a version of the product which meets all the minimum requirements of what needs to be delivered. This takes much skill and discernment to define, and varies greatly depending on the software purpose. For example, if something needs to be functional and readable so it can be delivered to the user, then that’s the MVP, but then if it won’t be released until it looks really sharp, then that is part of the MVP as well. Keeping an MVP in mind is a good way of ensuring there isn’t time spent creating unnecessary enhancements, which can be re-prioritised and added later.

EVORA Global SIERA EPC data

All these approaches form together to become the heart of SIERA’s robustness and effectiveness.


So, what exactly does this mean for our clients and product?

It means that SIERA can become the solution that will fill in the major gap in everyone’s workflow that is becoming a blocker, saving them time and effort, and addressing the long-term pain-points that users have been experiencing for years, then delivering these in the best way possible.

[clickToTweet tweet=”SIERA can become the solution that will fill the gap in everyone’s workflow, saving them time and effort.” quote=”SIERA can become the solution that will fill in the major gap in everyone’s workflow that is becoming a blocker, saving them time and effort”]

A good example of this is our Monitoring & Targeting system, with many companies looking for a solution to gather, store and display half hour data consumption for individual meters in an intuitive, clear and effective way, SIERA hit the market to fill in that gap. It did this through clear visual display, navigation and customisation, providing the basics of what was needed most.

Data can be compared against system overlays and user-defined overlays. The user can set operating hours for a meter, to visually differentiate when different amounts of energy should be used. The user can also set Alerts for their Meter, ensuring the user can tell when something has gone awry. All clearly displayed, as seen below.

EVORA Global SIERA Monitoring and Targeting module

As software users, users of our own product, and experienced veterans in the sustainability industry, we understand the importance of a good software and what it is this software needs to do. So, watch this space, SIERA is going to develop and evolve even more than it already has!


Have any questions about the specifics or want to find out more?
Get in touch!

GRESB 2018 Top Tips. Part 2 of 2

Looking to boost your GRESB 2018 score but not sure where to start? Never fear, as here at EVORA we have conducted extensive analysis of results and come up with some tips and tricks for picking up points.

Read Part 1 ‘What have we learnt from the GRESB 2017 results?here.

Visit our GRESB support service page.


GRESB 2018 Top Tips

1. Get an EMS

An Environmental Management System (EMS) is an organisation-level framework for the review, evaluation, and improvement of environmental performance. When aligned with the ISO 14001 standard, an EMS is immediately worth 2.5 points on the GRESB survey. Furthermore, an EMS helps you plan and direct environmental action to areas of the business where it will have the biggest effect, which will in turn generate further GRESB points. If you don’t have one already, our experts here at EVORA can help you develop an EMS uniquely tailored to the wants and needs of your organisation.

2. Data Data Data!

The methods for data collection and the extent of data coverage are huge elements of your final GRESB score, so getting a well-organised process in place is crucial for good performance. Table 1 summarises where data matters in the GRESB survey and how EVORA can help:

GRESB Analysis Fig 4

Table 1: The points available in GRESB 2017 for data capture and management

We are still waiting to hear if there will be any changes to the scoring for GRESB 2018, but we can guarantee that data capture and management will have a huge part to play again.

To find out more about our specialist data management software, visit the SIERA page or give the office a call on +44 (0)20 3266 7333 and we will be happy to tell you more.

3. Get Audited

Conducting technical building assessments is a great way to improve environmental performance, and another opportunity to rack up GRESB points. GRESB does not fully disclose the scoring system for the technical building assessment question, but by analysing client data we have developed a strong understanding of the scoring model used in the 2017 survey, based on the percentage coverage (by lettable area) where audits have been completed:

GRESB Analysis Fig 5

Table 2: Approximate scoring categories for GRESB Q16: Completion of Technical Building Assessments by floor area coverage

Whilst the overall question is scored out of 4.5, each category of assessment has its own limit to the points that can be achieved, and is then subdivided into four scoring categories based on portfolio coverage.

An important point to note is that we found no instances where a portfolio had some coverage but scored no points. This means an assessment of any type conducted anywhere, even on the smallest of assets, will immediately get you GRESB points.

[clickToTweet tweet=”This means assessment of any type, anywhere, even on the smallest assets, will get you GRESB points!” quote=”This means an assessment of any type conducted anywhere, even on the smallest of assets, will immediately get you GRESB points”]

Furthermore, such assessments actively seek to identify opportunities for efficiency improvements. These opportunities not only helps you to save on utility bills, but can improve your scores on GRESB Questions 17 and 18, which relate directly to the implementation of energy and water efficiency measures. Our team of experts is experienced in the completion of all kinds of audits, so get in touch to learn more about what we can do for you.

4. Get Certified

With a global average score of just 46, the Certification & Energy Ratings section is the GRESB aspect where there is most room for improvement. It is also something we know all about here at EVORA.

The scoring for Question 30 (regarding green building certificates) is a little complex, but essentially the portfolio coverage of New Construction and Operational certificates are benchmarked against that of other entities in your region within each GRESB property type, and you end up with a score for each property type of either 2, 4, 6, 8, or 10. All the scores are then weighted based on Gross Asset Value, and combined into a final question score out of 10. A full description of how the scoring was done can be found in the GRESB Reference Guide, or alternatively get in touch and we’ll be happy to explain it in full.

GRESB Analysis Fig 6

Figure 3: Points Scored vs New Construction certificate coverage for European offices in GRESB 2017

The key take-away is that there are real opportunities to pick up lots of points here. This is because the current low level of certification in real estate portfolios worldwide means that the benchmarking procedure used bottom-loads the scoring. As a result, even small amounts of certification coverage in your portfolio can score well, particularly if you have a combination of both New Construction and Operational certificates. Figure 3 focuses specifically on New Construction certificates amongst European offices, a particularly well certified property type, and shows that less than 50% certification coverage would have scored 8 out of 10 for this property type in GRESB 2017. Other property types benchmark even lower, so require even less coverage to rack up points.

[clickToTweet tweet=”BREEAM In Use, as one of most widely recognised certification schemes in the world, is ideal choice” quote=”BREEAM In Use, as one of the most widely recognised and respected certification schemes in the world, is an ideal choice”]

Of course, as certification becomes more popular worldwide this will drive up the benchmark percentages, but don’t let that dissuade you from an excellent opportunity to improve your GRESB score. BREEAM In Use, as one of the most widely recognised and respected certification schemes in the world, is an ideal choice, and is a service that we can provide. Get in touch to learn more.

Changes for the 2018 survey

Because of the constant shifting nature of sustainability and the real estate industry, GRESB reviews its survey each year and tends to make some changes to the scoring system. These are yet to be announced but, as a premier partner, EVORA is at the heart of the process, has a strong idea of how it will evolve, and is keeping tabs on GRESB releases on our clients’ behalf. Check out this blog by our Founder & Director Ed Gabbitas on GRESB’s ongoing review as an example.

We look forward to supporting you through GRESB 2018!

For enquiries regarding GRESB support or any other of our services, give our office a call on +44 (0)20 3266 7333, or email us at info@evoraglobal.com.

 


GRESB Premier PartnerAs a GRESB Real Estate Premier Partner, we are perfectly positioned to provide GRESB support. View our official Premier Partner profile.

We can work with you to complete the submission and understand your scoring, as well as develop a sustainability plan that will improve your future GRESB performance and align with your organisation’s key environmental objectives.

2017 GRESB Results: Future developments for enhanced portfolio sustainability performance

I, like many others, will be excited to receive the 2017 GRESB results when they are released tomorrow, 6th September. The rating approach, often simplified by how many Green Stars have been achieved, veils the trials, tribulations and efforts undertaken over the past year (or longer in many cases) to prepare for and complete the survey.

Visit our GRESB support service page.


Whilst I eagerly await gratifying news on how our clients fared for their past efforts, I am certainly more enthusiastic about collaborating on future programmes that will deliver value to their portfolios through making buildings productive, profitable and resilient to change.

In a previous blog, I introduced how the framework of an Environmental Management System (EMS) structured according to ISO’s Plan-Do-Check-Act methodology, is central to implementing successful real estate sustainability strategies that also result in better than peer average GRESB results.

In this blog, I introduce how insights into future developments of the GRESB survey will also provide that same win-win result of enhanced portfolio sustainability performance and GRESB ratings.


The Performance Indicator – a three-layer approach

The Performance Indicator (PI) ‘aspect’ is one of seven aspects in the GRESB survey. It holds joint top weighting, at 25%, with the Stakeholder Engagement aspect. Arguably, it is the Performance Indicator aspect that can best portray (to investors) how portfolios are performing and, importantly, contributing towards meeting the ambitious international targets set in the Paris Agreement. The PI aspect allows participants to set out their long-term sustainability targets together with quantitative disclosures on data coverage, like-for-like change and intensity values (KPIs) for energy, water, waste and carbon impacts.

A concern, however, is that the current approach does not provide investors with sufficient comparability of portfolio performance. This concern is underpinned by the fact that the current GRESB scoring approach rewards data coverage more highly than like-for-like change (concerning only year-on-year change, which certainly has limitations), but moreover, that no points are awarded for long-term changes to portfolio intensity values, such as kilowatt hours per metre square of lettable space. Only the methodology used to calculate intensities is scored, rather than the change in intensity values over time. The reason for this is likely due to a lack of data transparency and potential accuracy issues that stem from portfolio level, rather than asset level, reporting.

[clickToTweet tweet=”GRESB is willing to introduce an additional scoring element for accurate asset level data.” quote=”Current discussions indicate that GRESB is willing to introduce an additional scoring element for participants that can disclosure transparent and accurate asset level data.”]

GRESB recognises these issues and has set out to address them through a series of benchmarking committees, which EVORA participants in. Current discussions indicate that GRESB is willing to introduce an additional scoring element for participants that can disclose transparent and accurate asset level data. I expect GRESB to introduce their three-layer approach to Performance Indicator scoring in the 2018 or 2019 survey. This approach is set out below:

  1. All assets are evaluated on Transparency, based on data availability
  2. Only assets with high transparency levels can be evaluated on data Quality, given the external forms of data assurance or internal capabilities of data analysis (asset level data checks)
  3. Only assets with high data quality can be evaluated on Performance, most likely driven by like-for-like and intensities values.

Enhanced scoring methodology

GRESB is seeking to enhance its scoring methodology with the objective that only assets with high quality data are benchmarked to ensure fairness. This strategic change may assist in providing investors with more certainty on sustainability performance and comparability between portfolios.

[clickToTweet tweet=”GRESB is seeking to enhance scoring methodology with objective that assets with high quality data are benchmarked” quote=”GRESB is seeking to enhance their scoring methodology with the objective that only assets with high quality data are benchmarked to ensure fairness”]

Requesting asset level data will undoubtedly increase the reporting burden for a number of participants – most notably those who painstakingly enter portfolio level data directly into the portal.

Data can already be submitted at the asset level, either via an API link or the Asset Level Interface. However, this function is not used by all participants and furthermore, if you do not have the benefit of a sustainability software platform, such as SIERA  (which seamlessly updates the PI sections using the Asset Level Interface), then data collection and analysis will remain a manual, laborious task.


So why bother?

As mentioned above, the reward of additional points will be a sufficient driver for many. However, GRESB aside, let’s not forget that to make any notable impact on the performance of a portfolio, it is essential to have asset level data (or preferably meter level data) available in a format that can be easily accessed, interpreted and communicated to Asset and Property Management Teams in order to effectively manage sustainability impacts across a portfolio.

For more information on using data management systems to enhance portfolio performance see here.

Whilst some may see this change as GRESB introducing additional challenges and reporting burdens, I applaud their ambition in seeking to drive change in the real estate industry through promoting the availability and disclosure of investment grade asset-level data.

I applaud their ambition in seeking to drive change in the real estate industry through promoting the availability and disclosure of investment grade asset-level data.

It is important to reiterate that reporting asset, or even meter level data, doesn’t have to be a burden. Many participants, including all our clients benefitted from using the direct interface provided by SIERA to seamlessly update the required field in the Performance Indicator section and additionally, to review opportunities to make their buildings productive, profitable and resilient to change.


What’s next?  Plan-Do-Check-Act

Reverting to the Plan-Do-Check-Act methodology, I recommend that Fund, Asset and/or Property Managers review if they can effectively understand and manage sustainability impacts at asset and meter level using existing programmes. Where there is any doubt, I encourage stakeholders to:

  • Plan – start early and identify what you can meter already and what you would like to meter
  • Do – implement an appropriate metering strategy according to the value proposition of doing so
  • Check – utilise the powerful Monitoring & Targeting, and reporting tools provided by SEIRA
  • Act – use the investment grade data obtained through SIERA to drive improvements across your portfolio(s)

If you’d like to talk to us about your GRESB results, or about SIERA, we will be at the London results launch on 13th September. Please don’t hesitate to get in touch to arrange a meeting or a demo.


GRESB Premier PartnerAs a GRESB Real Estate Premier Partner, we are perfectly positioned to provide GRESB support. View our official Premier Partner profile.

We can work with you to complete the submission and understand your scoring, as well as develop a sustainability plan that will improve your future GRESB performance and align with your organisation’s key environmental objectives.

110 Seconds To Understand How SIERA Sustainability Software Can Help You

Watch Our New Video Now!

Watch our new animated explainer video for SIERA, which gives you a high-level overview of everything our innovative sustainability software solution can do for you.

Depending on where you are and how convenient it is to watch a video, you can:

1.     Watch the video with the sound on – recommended

2.     Watch the video with the sound off – the captions will allow you to follow along

3.     Read the video script, which is pasted below for your convenience

We hope you enjoy the video and that you will want to learn more by attending one of our webinar demonstrations or getting in touch to book a one-to-one demo.

Thanks for watching!


SIERA Sustainability Software – the right choice for your business


Video Script

Every year, environmental management becomes more complex and reporting requirements become more stringent.

Which is why the sustainability experts at EVORA came up with SIERA – a unique and innovative software solution.

Not only does SIERA make all your sustainability reporting easy – it also enables you to quickly identify energy savings in your buildings.

[clickToTweet tweet=”SIERA makes sustainability reporting easy and enables you to identify energy savings in buildings” quote=”Not only does SIERA make all your sustainability reporting easy – it also enables you to quickly identify energy savings in your buildings”]

Never before has collecting and validating your environmental data been so easy. Whether it’s automating data collection, or dragging and dropping your data from Excel files, SIERA makes a complex process simple.

The intelligent modelling capability covers a range of regulatory and voluntary reporting requirements, quickly and intuitively.

In fact, SIERA saves our clients up to 70% of their time spent on GRESB reporting.

SIERA also gives you an overview of your property and portfolio performance, helping you mitigate regulatory risk and prioritise improvement opportunities.

SIERA’s ground-breaking Energy Monitoring and Targeting module automatically alerts you to energy efficiency opportunities.

Savings are easy to identify and can be achieved without any capital expenditure.

[clickToTweet tweet=”SIERA gives an overview of property/portfolio performance, helping mitigate regulatory risk” quote=”SIERA gives you an overview of property and portfolio performance, helping you mitigate regulatory risk and prioritise improvement opportunities”]

Whether you’re seeking a hands-on solution, or a fully managed service with EVORA’s expert consultants – SIERA is the right choice for your business.

SIERA is already managing over 4,000 properties and is being rapidly adopted by large organisations across the globe.

Isn’t it time you used SIERA too?


 To learn more about SIERA and discover how it can save you time, stress, and money, please get in touch today to arrange a demonstration.

 


GRESB Premier PartnerAs a GRESB Real Estate Premier Partner, we are perfectly positioned to provide GRESB support. View our official Premier Partner profile.

We can work with you to complete the submission and understand your scoring, as well as develop a sustainability plan that will improve your future GRESB performance and align with your organisation’s key environmental objectives.

How To Use A Data Management System To Improve Your ESG Performance

Data Management: stop guessing and start making informed decisions that achieve real results!


Antoine de Saint-Exupéry once said “A goal without a plan is just a wish”.

I couldn’t agree more. Without a plan, you’re basically lost and hoping you’ll get to where you want to go. But to make a plan you need to know where you are, what is on the road ahead of you, and understand if you’re heading in the right direction. In the world of sustainability this is where data comes in.

As I mentioned in my last blog, we create massive amounts of data in our buildings every day. The challenge is making sense of it all, allowing us to understand what the impacts of our actions are, and what we need to do (or not do) to reach our end goal.

A data management solution, therefore, is essential in helping you achieve your objectives – understanding your data will allow you to understand your challenges and make the right decisions.

Using SIERA, we have been able to identify energy savings of between 10-15% on average for our clients, without any CAPEX costs. Let’s put this figure into perspective for a moment: Investment buildings consume around 40% of the worlds energy and contribute up to 30% of Greenhouse Gas (GHG) emissions. Imagine what results we could achieve collectively, globally, with said 10-15%  energy savings!

More than 95% of the world’s building stock is in existing buildings, and although we are making great advances in green technologies for new buildings, we need to make sure that we optimise the use of our existing ones as well.

Besides the potential of energy savings and GHG reductions, there are many other benefits to managing and sharing your data:

  • You can find and understand your data, allowing you to make more informed decisions
  • Business continuity if staff leave or new team members join
  • Avoid unnecessary duplication e.g. re-collecting or re-working data
  • Sharing data leads to more collaboration amongst teams
  • Improved scores on sustainability benchmarks through better management/data collection

Data management is not just about collating and reporting out the data. It is about understanding the data you’re producing to make informed decisions based on the results of your actions.

“However beautiful the strategy, you should occasionally look at the results.” – Sir Winston Churchill


If you would like to learn more about the positive impact a data management system can have, please join our experts and GRESB on July 6th at 9.30 BST at our free webinar. More details on the webinar here.

In one hour, you’ll see how easy it can be to improve the energy efficiency and sustainability of your buildings, and achieve your ESG goals!



PS – SIERA is now on Twitter! Here’s our first Tweet, which has already got people talking!

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