Rutger van der Lubbe, head of global real estate investment strategy at APG Asset Management, sat down for a video interview at Nareit's REITweek: 2024 Investor Conference, held in New York June 3-6.
During the interview, van der Lubbe emphasized APG’s proactive stance on climate risk within the real estate sector. APG extensively researches climate risk, differentiating between transition risks, such as regulatory changes, and physical climate risks, like climate hazards impacting building locations.
Van der Lubbe highlighted that transition risk is already evident through new regulations requiring energy and carbon efficiency improvements in buildings. APG has been instrumental in developing measures like the Carbon Risk Rules to monitor building efficiency and align with the Paris Agreement.
APG's engagement strategy does not differ significantly between REITs and private real estate investments, he explained. They maintain frequent dialogues and engagements with invested entities to drive change, particularly focusing on ESG matters. This approach includes individual engagements and broader market engagements through collaborations like the Global Engagement Net (GREEN) initiative.
Key metrics for evaluating REIT sustainability risks include energy and carbon intensity. Van der Lubbe underscored the importance of asset-level certification, not just for the certification itself but for access to crucial data points. "Having access to those data points puts us in a position to enhance, assess transition risk, and also ultimately identify what potential improvements need to be made."