Real estate greening has a thing for the high-end

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💡 This week: The 2022 edition of the GRESB rankings, a widely recognised benchmark, once again has a number of Singapore players near the top of its lists. CapitaLand Ascott Trust is the global sector leader for hotels for the second time running. Frasers Property Group’s Frasers Property Industrial, Lendlease Global Commercial Reit and Suntec Reit were regional leaders for the industrial, retail and office categories, respectively.

Singapore’s outperformance in the rankings could be related to the fact that land is expensive in the small country. That makes the additional cost of greening a building less onerous compared against the total cost of developing a project.

What kind of project gets built matters too. Researchers in 2017 found green cost premiums, or the additional cost of turning properties green, were lowest for the largest projects.

The outcome is that big projects in expensive real estate markets get greened earlier.

🌱 Top ESG reads:

1. Lendlease Asia CEO Justin Gabbani explains why greening real estate is easier on more expensive land.
2. Singapore’s Housing Development Board has launched up to S$1.2 billion of 4.09% five-year green bonds to finance or refinance green building projects.
3. All talk, no action? Most Singapore residents say ESG matters, but few act on it, according to a global survey by SEC Newgate.
4. ESG bonds’ share of overall debt issuance continues to grow, even though 2022 was a terrible year for selling new bonds, according to JP Morgan’s analysis. 
5. The London Stock Exchange’s newly launched Voluntary Carbon Market designation lets carbon projects raise money via IPOs. That model could work in Singapore too, says Singapore Exchange- and Temasek-backed Climate Impact X.

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