French fund manager La Française and property index provider GPR have launched a new global sustainable real estate index targeted at institutional investors which they claim will set a new standard for ‘climate-conscious’ investors in the listed real estate sector.
The new index will consist of up to 150 global sustainable real estate securities, selected on the basis of their real estate activities and environmental, social and governance (ESG) performance as well as market capitalisation. GPR will compile and administer the index, dubbed GPR IPCM LFFS Sustainable GRES Index, which will be reviewed on a quarterly basis.
GPR will work together on the index with UK-based Inflection Point Capital Management (IPCM), the sustainability-focused investment advisory arm of La Française, and La Française Forum Securities (LFFS).
IPCM will assess constituent companies in terms of carbon intensity, materials use, water use efficiency, electricity use and energy efficiency, as well as health and safety, human capital management and overall governance. LFFS will provide IPCM with ESG-related company data, information and insights garnered from its research and interviews with management.
The partners say the new index keys into the increased demand among institutional investors for real estate strategies that incorporate sustainability factors.
Matthew Kiernan, CEO of IPCM, commented: ‘All over the world, demand for more sustainable real estate offerings is growing exponentially. The leading, most far-sighted real estate companies have recognized this trend and are providing innovative solutions. This new index provides investors with a unique opportunity to identify the leading, best-managed companies and invest in their securities.’
Jeroen Vreeker, head of the GPR Index Team, said: ‘Sustainability is a factor that is increasingly implemented when providing benchmark solutions for listed real estate investments. The GPR IPCM LFFS Sustainable GRES Index covers over 60% of the total market capitalization of the broad GPR General Quoted Index and remains highly diversified to countries and sectors. The index is a valuable addition to GPR’s suite of tailor-made benchmarking solutions.’
Jana Sehnalova, managing director of LFFS, added: ‘The GPR IPCM LFFS Sustainable GRES Index sets a new industry standard for climate-conscious investors in the listed real estate sector. Given the growth in tenant demand for green real estate and tightening government regulations, real estate securities with underlying holdings that have superior environmental characteristics and a strong focus on social and governance factors should outperform financially.’
For more details about the new index, read the interview with Matthew Kiernan (IPCM), Jeroen Vreeker (GPR) and Jana Sehnalova (LFFS) in the November issue of PropertyEU Magazine
