EVORA embarks on a mission to NYC

I’m excited to be leading a team as EVORA embarks on a mission to NYC to meet familiar faces and understand more about the key issues and challenges they are facing in the US market. We’ve had a tremendous reception and a full schedule of meetings. It’s not all about numbers, but we’ll be catching up with more than half of the top 30 investors in North America by AUM, representing $1tr of real assets. This number, more than anything, highlights the scale of investment risk if real assets fail to stay relevant in their market over the long term. Now more than ever, staying relevant must include plans and progress on climate mitigation and adaption as climate action has moved from the periphery to the core for leading investors.

In terms of market uncertainty, real assets have historically provided a safe haven. We expect more capital to flow into US real assets over the coming year. As the climate change clock ticks away, we are focusing in on how to choose and make assets that are climate resilient. With the SEC proposing new rules to make climate risks more transparent it will only be a matter of time before these risks are priced in, whether those are transition, adaptation or litigation risks.

We launched EVORA 11 years ago in turbulent economic times as a result of the financial crisis. Fast forward to the current day, we are seeing different but equally challenging economic times across the world. A key difference now is the urgent need for good advice – and data – as a result of the heightened climate crisis. For EVORA, directing capital to more sustainable outcomes for the wellbeing of the planet and its people has always been central to our purpose.   We’re excited about the next step in our evolution and the warm reception we’ve had from the USA.

Meike Borchers adds European weight to the monthly EVORA Global Board meeting

EVORA Global is pleased to announce that Meike Borchers, Head of EVORA Germany/DACH, has formally been asked to attend the UK Board of Directors, to represent and give direct input into the operations and expansion of the DACH region.

Meike joined EVORA in November 2020, bringing with her over 20 years of consulting experience, including heading up WSP Deutschland AG in Hamburg. Her background is in the construction and real estate industry, having worked in the UK, Sweden and America.

Meike has grown the German team from two to 14 people in the space of 12 months and provides consultancy services to many of Germany’s leading real estate and financial organisations, including BNP Paribas, CRESCO, d.i.i, LHI, HIH, HINES, Invesco, MOMENI, Schroders and UBS. Her proven leadership and meaningful understanding of European markets complements the Board and Company as EVORA continues to expand its offering across Europe and beyond.

EVORA’s Core Board has strengthened its operational focus with the addition of five non-statutory operational directors appointed in the last two years. EVORA’s headcount has grown from 50 to over 150 since 2020, with operations in seven countries and plans for further expansion this year.

“The positive impact we create as EVORA team and with our clients is what highly motivates me every day and there is so much more for us to do. I am therefore thrilled to represent our fast-developing DACH ESG-Team at Board level and to become even more involved in shaping the future of EVORA.”

Meike Borchers, Director Germany

“Meike’s faith in both EVORA and the growing need for dedicated ESG advisory services in the DACH region were the foundations of an outstanding first 18 months in the region.  Her global expertise across multiple sectors and experience in growing strong teams has been critical to the success of our 20-strong team (and growing) and I am delighted that we now have her wisdom and insights formally at Board level.”

Philippa Gill, Director Europe

What did we learn from our first EVORA Insight’s lunch on the topic of how ESG is being integrated into investment decision-making?

The gap in expectations between the leaders and the majority of investment managers is huge. Even the leaders don’t think they are doing anywhere near enough. To be honest, it’s a little disheartening.

Organisational change and capacity building is being hampered by structural changes, which cannot be solved by each firm on their own. For instance, the historically low price of gas as a common fossil fuel, compared to electricity which can be net zero carbon, presents an affordability challenge. Also, the lack of availability of standardised and simplified ESG data to inform investment decisions and to understand the underlying risks. To gather ESG data, particularly for a whole building, is still a time-intensive process requiring active engagement with tenants and other stakeholders, without regulatory support in many countries.

However, there are choices that companies can make to include ESG factors as standard practice. To include ESG representation in the IC and to decide on ESG “red lines”. More often than not, assets are being acquired with little or no considerations of ESG risks and opportunities pre-transition. For some funds, this is the only opportunity to incorporate these factors and budget accordingly, particularly when future income could be compromised. Notwithstanding the need for ESG data to be readily available at the time of the transaction, during a period in the market when there is an insufficient supply of properties to meet the demands of available capital allowing little time to consider non-financial considerations.

We ask our clients to think about ESG over the timeframe of two hold periods – to consider how ESG will be priced into the exit value. There is little room to do this effectively under present market conditions, in part due to the uncertainty of how to interpret financial impacts of climate projections, and because pricing in that risk may result in losing the deal. There is anecdotal evidence of buyers winning and losing deals with risk-adjusted pricing, which most often appears to be through the incorporation of the costs of decarbonisation/adaptation measures or an adjustment to the cap rate at exit as a proxy for perceived future risk. More observational data is needed to understand under what conditions these price adjustments are and are not resulting in winning deals.

Some companies know that the reliance on GRESB ratings and EPC data, which don’t measure actual performance, is insufficient to understand the underlying risks and opportunities. Making the right investment decisions requires technical and operational insights, when there is a shortage of these skills and to get the right experience it requires support from multiple consultancies. However, it seems inevitable that certifications and ratings will continue to be used as a short cut.

With the background of the environmental sciences telling us that we are running out of time to tackle the global issues of climate change, destruction of biodiversity, and pollution of the land, water and air. Social inequalities are generating unrest in our communities. It has left us wondering how do we change the philosophical principles on which real asset investment has been grown on over the last 50-60 years. Is the only way forward a ratcheting up of regulations to force change, which would require proactive involvement from investment managers in policy discussions for finance, sustainability and buildings to be successful?

Over the last couple of years there have been reasons for optimism that real estate investment and finance is starting to change for the better, these include market indicators like:

  • Investor pressure to explain ESG and climate risk policies is increasing and tougher questions are being asked, although how this information is used in unclear
  • More individuals throughout real estate investment firms, and outside of the traditional sustainability team, are being required to take responsibility for ESG
  • ESG and climate risk are showing up on performance objectives for more staff
  • Valuers are starting to query for data on EPC ratings to incorporate into valuations, and market analysts are using this information to review income projections. 

So, looking ahead to 2050. When people look back to this period of change happening today and see what an exciting time we have lived through, will you be one of those who can say that you joined us to push ESG integration forwards successfully or will the transition come too late given the scale of the changes we have to make?

Sonny Masero joins Board as Chief Strategy Officer

EVORA Global is delighted to announce that Sonny Masero has joined the company’s Board as Chief Strategy Officer (CSO).

Sonny joins EVORA at an exciting and challenging time in the company’s history. In the midst of the COVID-19 pandemic the EVORA Board is looking ahead; knowing that the sustainability of real assets remains a high ESG priority for investors. Climate change, the restoration of wildlife and social equality are all a global priority for this decade.

Sonny brings to EVORA Global 25 years of expertise in the field of energy, climate change and sustainability in real estate and corporate governance. He has worked with CleanTech and PropTech businesses, including CA Technologies and Demand Logic, winning nineteen industry awards for innovation, leadership and best practice. Sonny is able to draw upon a broad depth of experience across a wide range of companies, from Fortune 500 and FTSE corporations, SMEs, charities and start-ups –two of these securing recognition as Best UK Workplaces.

As CSO, Sonny will develop and drive forward EVORA’s market strategy, using technology to support our consultancy team to deliver outstanding and leading solutions to the industry – to be the best. Building on EVORA’s market leading SIERA software platform, the strategy will respond to interest from investors in the active management and disclosure of ESG risks and climate resilience. The next decade is critical to tackling climate change and biodiversity restoration, and EVORA is committed to helping clients achieve the largest positive impact they can.

Chris Bennett, CEO, comments “EVORA has managed to plot a successful route through 2020 in a very difficult and unusual time. I am extremely pleased that someone of Sonny’s reputation has chosen to join our Board to help drive the business forward to achieve even greater success.”

Sonny Masero said “EVORA has a strong reputation in the ESG market, working closely with the leading property investors and investment managers, and doing so with integrity. I am excited to be joining Chris, Paul and Ed’s company to execute on a growth strategy with a clear sustainability purpose at such an important time.”

Philippa Gill to join EVORA Global as Director

EVORA Global are delighted to announce that Philippa Gill will be joining on February 1st as Director and will be merging Verdextra into EVORA’s existing business operations.  

Verdextra are a specialised Sustainability, Health and Wellbeing and Operations Consultancy and have emerged as thought leaders in the Health and Wellbeing arena. We are very excited to be integrating Verdextra’s capabilities into our services portfolio as a key part of our commitment to broadening and upscaling our service line offerings.

We are absolutely delighted that Philippa has agreed to join us. Philippa’s deep heritage in global real estate and current thinking in emerging key topics such as Health and Wellbeing will not only add to EVORA’s depth of capability, but will really add strength to our senior leadership team and help drive our international reach. This is a truly exciting time for EVORA and we look forward to 2020 being another key milestone in our development.

EVORA’s Managing Director, Chris Bennett

Philippa brings truly world class pedigree to EVORA having previously occupied a range of senior sustainability leadership roles within Global Real Estate organisations. Philippa has a proven track record of driving real change through an extensive portfolio of Sustainability Transformation Programmes, spanning construction through to software and intelligent building management technologies.  

Philippa also brings extensive experience from within the Private Equity community and will play a key role in driving our international growth plans and supporting bringing new Value Propositions to Market.

Verdextra and EVORA’s business expertise and philosophy align so well, and I am delighted to be merging our business with theirs. The opportunity to combine my own experience with the sector leadership EVORA embodies is truly exciting and I am looking forward to harnessing our joint capabilities.

Philippa Gill, Partner at Verdextra