Input 2020.12.28 06:00
In addition to corporate management,’ESG’ is emerging as a hot topic in the real estate alternative investment market such as offices and distribution centers. ESG stands for Environment, Social Responsibility, and Governance. As regulations to respond to climate change and prevent environmental pollution are being strengthened around the world, it is being used as an important measure not only in corporate evaluation but also in selecting investment targets.
Big Hands Investing in Real Estate Worldwide Global asset managers have already started investing with ESG scores. A representative indicator is the’Global Real Estate Sustainability Benchmark’ (GRESB), which evaluates the ESG performance of real estate worldwide. It is a score evaluated by evaluating the real estate management system, policies, disclosures, and whether each country has acquired eco-friendly building certification. If the score is less than a certain point, it is excluded from the investment target. Conversely, if it receives a high score, it is evaluated as a stable real estate/investment company and is advantageous for fund formation.
In Korea, the’Easy Autoway’ building operated by’Kendal Square Logistics Properties’ and’Easy Asset Management’, a development company specializing in distribution centers, received a GRESB 5 Star rating. The logistics centers, Bucheon Logistics Park and Goyang Logistics Park, received a’WELL Gold’ rating and a’LEED’ rating from IWBI, a public certification body in the environmental field. This is the first acquisition among distribution centers in the Asia Pacific region. They introduced an energy saving and recycling system, which was evaluated as not simply focusing on scale-up or development, but devoted to supplying sustainable distribution centers from planning to implementation.
Construction companies are also increasingly receiving ESG evaluation. Looking at the ‘2020 ESG evaluation grade for listed companies,’ published by the Korea Corporate Governance Service, none of the listed construction companies received A+ in the integrated grade, but Samsung C&T, Hyundai E&C, GS E&C, and Samsung Engineering received A grade.
Samsung C&T announced that it will not participate in the investment and construction of coal-related projects for the last time in Gangneung and Vietnam’s coal-fired power plants under construction this year. In the future, it has established a policy to expand eco-friendly businesses such as renewable energy such as wind power and solar power, and liquefied natural gas (LNG) combined cycle power and storage facilities.
POSCO E&C is the first Korean construction company to issue ESG bonds worth 120 billion won. A company official said, “We plan to use the funds secured by issuing bonds for business such as development of eco-friendly building technology, new and renewable energy, expansion of social infrastructure, and improvement of the old residential environment.”
SK E&C is pursuing a plan to grow into an eco-friendly company focused on technology by taking over all shares of EMC Holdings, the largest environmental platform company in Korea this year. SK Group is reinforcing ESG management, led by Chairman Choi Tae-won.
The construction industry predicts that strengthening ESG management will be a hot topic next year. The industry is saying that the eco-friendly business and renewable energy business will be attracting attention, as well as the digitalization business of real estate such as smart building management and the introduction of electric vehicle charging stations.
Samsung Securities analyst Lee Kyung-ja said, “The trend of investing by evaluating ESG performance centered on large managers such as European pension funds and Blackstone is strengthening.” “ESG is now a survival strategy, not an option.”
An industry official who mainly deals with offices said, “Europe as well as the United States will introduce a punitive tax that assesses the carbon dioxide emissions of offices, and the regulations and incentives for eco-friendly buildings will be strengthened.” You need to be prepared,” he said.