The Hines European Core Fund (HECF) won the 2021 PREA Real Estate Investment Management ESG Award in the Open-End Fund category.
The prestigious annual awards recognize Pension Real Estate Association (PREA) members at the forefront of Environmental, Social and Governance (ESG) matters within real estate investing and provides the industry with associated examples of best practice.
“It is a real privilege to win the PREA Award for our Hines European Core Fund and is testament to our team’s fantastic ongoing work, rooted in sustainable investing and local ESG-focused asset management. Our ethos is that strong sustainability management and financial performance goes hand-in-hand and creates long-term value. To be the winner in such a highly sought after category with 59 competing funds, highlights how far our Fund has come,” said Peter Epping, HECF fund manager. “That said, we will not rest on our laurels as there is a lot more we want to achieve including carbon neutrality by 2030. We look forward to pushing the boundaries in ESG while creating a positive and long-lasting impact on the cities and communities we serve, while delivering strong financial returns.”
The HECF acquires and manages a diverse portfolio of real estate assets across Europe. With a current AUM of over €2 billion spanning 30 assets, HECF has investments in 15 cities across nine countries, and strives to improve the built environment and communities in which it invests.
The Fund’s ongoing actions include:
- A rigorous utility consumption monitoring program to drive optimization of building operations.
- 100% of the portfolio is covered with sustainability certificates including 14 BREEAM certified buildings, 4 DGNB gold building certifications and 2 HQE Building Certifications (as at year end 2019).
- Each of the Fund’s directly managed buildings, 15 in total, are using 100% renewable electricity contracts.
- Adopted a science-based target of reducing greenhouse gas emissions by 42% by 2025, and 60% by 2030 across the portfolio, against a 2018 baseline. These targets are reduced to 4% and 22% respectively for landlord controlled areas once green tariffs are considered.
- Commitment to carbon reduction including putting in place a Net Zero target by 2030 for the Fund.
- Utilizing onsite renewable solar thermal panels providing hot water. Two of the Fund’s assets Caleido in Stuttgart and Via Crespi in Milan have already implemented.
- A focus on the human and social impact of the built environment. This includes engaging with tenants through the Hines GREEN OFFICE and Hines GREEN RETAIL Tenant Programs, voluntary plans to encourage sustainability in the tenant’s premises.
- Active community engagement. For example, HECF makes the most of its membership with Business Improvement Districts (BIDs) to improve communities associated with its operations.
As a result of this ongoing action, the Fund surpassed the following targets it set out to achieve:
- A 10% reduction in landlord-controlled energy consumption by 2020. By the end of 2019, a 15.7% cumulative reduction had been achieved.
- An 8% reduction in landlord-controlled greenhouse gas emissions by 2020. By the end of 2019, a 23.8% cumulative reduction had been achieved.
- 100% waste diverted from landfill representing 380 tonnes in 2019, equivalent to 190 automobiles per year.
The urgency of ESG implementation continues to gather momentum worldwide given the mounting evidence of the scale of the environmental problem, and these issues are increasingly becoming central to investment decision making. Properly implemented ESG programs help foster a sustainable and socially responsible future, without sacrificing investment performance.