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As part of its C Change program, ULI Europe is collaborating with sustainability analysis specialist Synergetic to begin developing a new interactive tool that will enable the real estate industry to incorporate climate change into financial models that are at the core of investment decision-making.
The free-to-use ULI “Preserve” tool provides a key aspect of ULI Europe’s ongoing C Change program, which aims to mobilize Europe’s real estate industry to urgently accelerate decarbonization and understand and remove barriers.
The purpose of this new tool is to enable modifications of previously published ULICs. Migration Risk Assessment Guidelines Planned for large-scale industry adoption, Preserve enables real estate companies to quantify the financial impact of opportunities and risks associated with the transition to net zero, allowing them to consistently and uniformly incorporate risks such as future energy costs and demand, potential rent increases, carbon pricing and capital expenditures into their investment decisions.
ULI and Synergetic are working closely with Mott MacDonald and CBRE UK Valuations Advisory to develop this easy-to-use, extensible tool, which leverages insights from C Change partners, ULI members and a range of key stakeholders across the value chain to ensure Preserve reflects a wide range of industry requirements.
Sophie Chick, Vice President of ULI Europe, commented, “Across the industry, there is a lack of consistency in the way transition risks and opportunities are integrated into business planning. The Preserve tool aims to create a level playing field for all, facilitating and encouraging widespread adoption of transition risk assessments among all stakeholders and avoiding the risk of disadvantage. We believe Preserve provides a vital resource for all to implement the transition risk guidelines in a practical way.”
“The industry is at a crossroads, balancing the twin objectives of financial performance and climate action. To do this successfully, we need data-driven insights into the financial risks – and just as importantly, the opportunities – associated with the transition to net zero. We’re proud to work with ULI and our partners Mott MacDonald and CBRE to provide this insight to the industry and build tools that will drive resilient climate action that makes commercially sense,” said Synergetic CEO Derek Wilson.
Lizette van Doorn, CEO of ULI Europe, concludes: “We all recognise that real estate is a major contributor to global carbon emissions, and the Paris Agreement clearly outlines the targets to be reached by 2050. Incorporating positive and negative transition risks into investment decision-making provides the industry with an important step to accelerate the decarbonisation of the built environment. However, as there is still no regulation to achieve net-zero built environments, these impacts are currently not reflected in real estate investment valuations. The Transition Risk Assessment Guidelines are designed to help the industry build the business case for decarbonisation, focusing not only on capital expenditure but also on preserving and potentially enhancing value.”
“Preserve is a natural evolution of this process, with the guidelines essentially forming the technical outline of the tool, which we believe will enable the industry to drive real transformation and create lasting change across the industry in its efforts to decarbonise – all facilitated by an interactive tool that is intuitive and easy to navigate.”
Preserve will be developed in multiple phases, with the first phase focusing on the technical specifications of the tool, followed by development and testing, and finally pilots and case studies, before being released as a publicly available, free-to-use resource.
To ensure this tool adds value to the industry, ULI and development partners will actively seek input and feedback from ULI members and the industry at large. AC Change roundtables will be held at the following meetings: ULI Europe Conference Taking place in Milan (10-13 June 2024), registered attendees will have the opportunity to provide input into the tool’s user specifications. Industry players will have further opportunities to contribute their expertise to the development stages of ULI Preserve and to participate in piloting the tool at a later stage as part of the broader C Change program.
The C Change program is sponsored by organizations including Catella, Hines, IPUT Real Estate, Longevity Partners, Patrizia, PIMCO, Redevco, Savills Investment Management, Schroders Capital, Sonae Sierra and Urban Partners.
Contact Sophie Chick [email protected] If you are interested in supporting Preserve’s development or would like to learn more about the tool or pilot and sponsorship opportunities, please contact us.
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