The merger of GRESB, the global real estate sustainability benchmark based in Amsterdam, with the US-based Green Building Certification Institute (GBCI) goes against the very principles on which GRESB was founded, according to Olivier Elamine, CEO of Alstria Office REIT.

The merger of GRESB, the global real estate sustainability benchmark based in Amsterdam, with the US-based Green Building Certification Institute (GBCI) goes against the very principles on which GRESB was founded, according to Olivier Elamine, CEO of Alstria Office REIT.

Originally set up as a non-profit organisation and a platform for investors, GRESB has now sold its soul to commercial interests, he told PropertyEU. ‘I find it very difficult to understand the benefits of the sale for the investors and companies who take part in the GRESB survey. GRESB was initially launched as a non-profit organisation, as part of a campaign aimed at improving transparency in the sector, but in essence it has now become just another commercial rating agency.’

Hamburg-based Alstria was among the first real estate companies worldwide to submit data to GRESB when it was launched in 2009, but the company stopped reporting this year due to concerns about the governance of GRESB and the philosophy it espouses. ‘With other rating systems, companies who submit data have the right to comment on the result and thus clarify items that numbers alone might not explain,’ Elamine continued. ‘Whether it is taken into account or not is another matter. When GRESB started there were hopes that the data was to be made publically available. That never happened and now companies who submit data to GRESB are required to pay a fee for a detailed benchmark report that analyses their own data. That is pretty extreme.’

DIALOGUE IS NEEDED
Elamine believes GRESB has built a monopoly with the help of the very members who contribute data to the survey. ‘The last thing we need is another monopoly. We need to hear different voices and to have a dialogue. We don’t need a dogma imposed upon us. The International Sustainability Alliance fell apart for the same reason.’

GRESB measures the sustainability performance of more than 630 real estate portfolios around the globe, with a total of more than $2 tln in assets under management. More than 130 members, including 42 pension funds and their fiduciaries, jointly representing $8.9 tln (€6.8 tln) in assets under management, use the GRESB benchmark results throughout the investment management and engagement process.

Elamine’s objection to the commercialisation of the GRESB initiative is that most other CSR rating systems allow companies to comment on their results. ´They know that you cannot just run the numbers through an algorithm to get a decent view on the underlying CSR performance of a company. A human brain is usually useful to digest the numbers and read them in light of a defined policy, and that brain usually needs interaction with the company that has submitted the data. In the case of GRESB, an algorithm does all the work and there is little or no human interaction involved.’

CLIMATE ACTION AWARD
Just last week Alstria office REIT was awarded the CDP Climate Action Award at the latest DACH Climate Leadership Award Conference & Ceremony in Munich. Alstria received the award for its substantial reduction of GHG (greenhouse gas) emissions which was achieved through a systemic procurement of energy produced from renewable sources only. Currently this policy has been implemented on just a part of Alstria’s portfolio, but the company aims to roll it over all the assets in due course which should allow for a further reduction of emissions going forward. Alstria was the first listed real estate company to publish a CSR report and will be publishing its updated 2014 report on 4 November.

‘We are very proud of this reward, that not only compares our performance with our real estate peers, but with the wider economy,’ Elamine said in a reaction. ‘It is a testimony that the choices that we have made, to focus our resources on what matters, rather than on Green Building certification or other marketing tools, yield higher and lead to more sustainable results.’

BROADER CONCERNS
Concerns about the creation of green rating monopolies also surfaced at the recent Expo Real fair held in Munich. During a session for the Green Rating Alliance called – ‘Common platform for sustainable measurement - is it ever possible?’, the audience was asked for a show of hand on the question of whether one system platform to include portfolio and individual building measurements was needed or whether the current multi-system of measurement and certification was better. In a comment on Linkedin, moderator John Pike noted that the audience was equally divided. One delegate opposed to the idea of a system platform said: ‘I do not want one system holding me to ransom.’

However, an alternative view expressed was that a single data house such as Google or Microsoft could house all data supplied by GRESB through to say DGNB from which companies could draw down to instruct their preferred supplier to prepare a CDP report or LEED certification.

According to Ralph Wood of AXA Real Estate Investments, there are dangers in applying general benchmarking and measurement principles such as you would find in the benchmarking of equities. Unlike shares in a company, no two properties are the same, he noted.

A general view espoused during the panel discussion was that more focus was needed on a sustainable approach to sustainable life cycle management. Too much emphasis is being given to the initial certification as a badge of green respectability without any follow-up to green management of buildings. Commenting on the trend, panellists Christoph Wildgruber of Allianz Real Estate and Christiane Conrads of DLA Piper called on the industry to establish working groups to take the debate forward.