Change is Coming: Climate-Risk Disclosures and the Future of Real Estate Investment Decision-Making
How might businesses need to shift their thinking and strategies in response to regulatory changes and growing investor pressure regarding climate-related data? How can mandated data empower investors in pricing climate risk and how might the availability of mandated climate-related data reshape traditional investment decision-making processes?
The Urban Land Institute (ULI) has partnered with Heitman, a global real estate investment management firm, over the past five years to conduct research at the intersection of climate risk and real estate. This fourth report in the series examines how global regulations are driving more widespread, more comprehensive, and more auditable climate disclosure and what these new reporting requirements will mean for real estate investor decision-making. SFDR, local regulations, and the proposed SEC rule are just a few examples of new mandates requiring companies to disclose both GHG emissions and climate risks to their long-term business operations.
Change is Coming: Climate-Risk Disclosures and the Future of Real Estate Investment Decisions explores how global real estate investors plan to use forthcoming regulator-mandated climate data. The report outlines current and proposed climate reporting frameworks and regulations, including the SEC’s proposed mandatory climate reporting. If such regulatory mandates are enacted, they are likely to result in increased data disclosure on climate risk and emissions from much of the real estate industry, public or not, around the globe. In the EU, the Sustainable Finance Disclosure Regulation (SFDR) has been implemented and reporting began in 2021-2022. The International Sustainability Standards Board (ISSB) also released a set of standards, in line with TCFD recommendations, that will be effective January 1, 2024, and may serve as a baseline for future disclosures.
All these existing and forthcoming regulations push the real estate industry participants to follow best practices for transparency regarding climate risks, to report on how they have or plan to adapt to climate impacts already apparent, and to report their progress on achieving operating targets regarding decarbonization. In this report, the Urban Land Institute and Heitman examine what new reporting requirements will mean for real estate investors, with a focus on how global real estate investors plan to use forthcoming regulator-mandated climate data. The desire for information about physical risk is present for real estate assets, and regulatory mandates will make data high quality, more comprehensive and more auditable.
Also, in the ULI-Heitman Climate Risk series:
- Climate Risk and Real Estate Investment Decision-Making
- Climate Risk and Real Estate: Emerging Practices for Market Assessment
- Climate Migration and Real Estate Investment Decision-Making
Authors:
- Maryann Haggerty
Report Summary: How might businesses need to shift their thinking and strategies in response to regulatory changes and growing investor pressure regarding climate-related data? How can mandated data empower investors in pricing climate risk and how might the availability of mandated climate-related data reshape traditional investment decision-making processes?
The Urban Land Institute (ULI) has partnered with Heitman, a global real estate investment management firm, over the past five years to conduct research at the intersection of climate risk and real estate. This fourth report in the series examines how global regulations are driving more widespread, more comprehensive, and more auditable climate disclosure and what these new reporting requirements will mean for real estate investor decision-making. SFDR, local regulations, and the proposed SEC rule are just a few examples of new mandates requiring companies to disclose both GHG emissions and climate risks to their long-term business operations.
Change is Coming: Climate-Risk Disclosures and the Future of Real Estate Investment Decisions explores how global real estate investors plan to use forthcoming regulator-mandated climate data. The report outlines current and proposed climate reporting frameworks and regulations, including the SEC’s proposed mandatory climate reporting. If such regulatory mandates are enacted, they are likely to result in increased data disclosure on climate risk and emissions from much of the real estate industry, public or not, around the globe. In the EU, the Sustainable Finance Disclosure Regulation (SFDR) has been implemented and reporting began in 2021-2022. The International Sustainability Standards Board (ISSB) also released a set of standards, in line with TCFD recommendations, that will be effective January 1, 2024, and may serve as a baseline for future disclosures.
All these existing and forthcoming regulations push the real estate industry participants to follow best practices for transparency regarding climate risks, to report on how they have or plan to adapt to climate impacts already apparent, and to report their progress on achieving operating targets regarding decarbonization. In this report, the Urban Land Institute and Heitman examine what new reporting requirements will mean for real estate investors, with a focus on how global real estate investors plan to use forthcoming regulator-mandated climate data. The desire for information about physical risk is present for real estate assets, and regulatory mandates will make data high quality, more comprehensive and more auditable.
Also, in the ULI-Heitman Climate Risk series:
- Climate Risk and Real Estate Investment Decision-Making
- Climate Risk and Real Estate: Emerging Practices for Market Assessment
- Climate Migration and Real Estate Investment Decision-Making
Authors:
- Maryann Haggerty