Highlights performance on sustainability 2023

Promoted ecological and social characteristics

The Fund promotes ecological and social characteristics and is therefore classified as an Article 8 product according to the SFDR. In 2023, the Fund introduced its ESG Framework, which explicitly defines all ESG-related elements for the Fund. The Fund has defined four ESG objectives, which reflect the environmental and social characteristics that the Fund promotes. The ESG objectives are at the heart of the Funds’ strategy and support four United Nations Sustainable Development Goals (SDGs).

• Building a future-proof and sustainable portfolio;

• Reducing environmental impact;

• Liveable, affordable, attainable & inclusive places where people want to reside – now and in the future;

• Contributing to healthy, safe and responsible operations.

1. Building a future-proof and sustainable portfolio

Above-average sustainable fund

In 2023, the Fund retained its GRESB 5-star rating and improved its score to 92 points, four points higher than the previous year. The increase in score is mainly due to improvements on water and waste performance. To retain its GRESB 5-star rating this year, the Fund will focus on improving the score on tenant data coverage of waste and water. The Fund scored less than its peer group on these performance indicators last year. And of course the Fund will have to ensure that it continues to score highly on the other indicators.

GRESB score 2023

Above-average sustainable buildings

The Fund's goal was to obtain 100% insight into its assets' sustainability performance and to have 100% of its assets certified as BREEAM-NL In-Use Good or better by the end of 2023, with more than 20% In-Use VERY GOOD or better. In addition, benchmarks help the Fund to make informed business decisions to mitigate environmental, social and governance risks and enhance its long-term returns. 

By year-end 2023, the Fund had obtained BREEAM labels for 100% of its portfolio, with exception of the two newly acquired assets (De Groote Wielen shopping centre in Rosmalen and Kerschoten shopping centre in Apeldoorn). It was not possible to label these two new assets immediately. This will take place in Q4 2024 and Q1 2025. The Fund saw a slight decline in the percentage of BREEAM-NL Good or better certificates to 84% (2022: 91%), against an increase in BREEAM-NL Very Good certificates to 13% (2021: 12%). The decline in the BREEAM NL Good or better percentage was due to a deterioration of the label for the Berkel Center shopping centre in Berkel en Rodenrijs. In 2024, the roof of this shopping centre will be replaced, insulated and partly fitted with solar panels. This intervention is expected to restore the Good or better percentage.

BREEAM scores  (% of standing lettable floor space)

2. Reducing environmental impact

Bouwinvest committed itself to the Paris Proof commitment of the Dutch Green Building Council (DGBC). The Fund has drawn up a roadmap to realise its ambition to be net-zero carbon (Paris Proof) before 2045, and has translated this in to specific roadmaps for all assets. The Fund has incorporated the technologies, measures and costs in the Fund's strategic maintenance plan for the coming years.

Combatting Climate Change: source of energy

The Fund aims to have 100% gas-free units by the end of 2045, as part of its Paris Proof programme. At the end of 2023, the natural gas-free percentage for the entire portfolio stood at 31%. At the moment, new leases, new-build projects and divestments make the biggest contribution to improving this percentage. The Fund expects a faster increase in assets free of natural gas in 2024, partly due to a growing number of tenants who are switching to 100% electric technical installations. The Fund closes green leases with all new tenants, which means that the rental space will be delivered without a gas connection  The Fund has carried out various sustainability projects over the past few years and will continue these efforts in the years ahead.

In 2023, 100% of the electricity the Fund purchased was CO₂ emissions free (scope 2), as it was in 2022. In 2024, the Fund will focus on reducing its electricity use and enlarge the share of renewable energy.

Combatting Climate Change: energy efficiency of buildings

The Fund reduced the average energy intensity of its portfolio by 9% to 205 kWh/m² (226 kWh/m² in 2022). This is in line with the targeted reduction per year. The results shown are based on the information from the energy labels of all the retail spaces. In the coming years, the Fund will make a major effort to report on the basis of actual energy consumption. To do this, the Fund needs to increase the data coverage of the energy use of its tenants.

For 2024, the Fund has set yearly reduction targets regarding its efforts to reduce its environmental impact.

3. Liveable, affordable, attainable & inclusive places where people want to reside - now and in the future

Product accountability: tenant satisfaction 

In a dynamic retail environment, it is important to stay in touch with tenants. This contact gives the Fund insight into their daily business activities, and developments and trends in the retail industry, but also into the potential improvements in its assets. It provides relevant information that can be used in the management of the Fund.

The Retail Fund conducts a bi-annual tenant satisfaction survey, which provides insight into the satisfaction of tenants and highlights potential improvements. Despite the difficulties in the retail market, the Fund scored 6.6 for the quality of the assets in the 2023 survey. This score represented an improvement compared to the 2021 survey (6.5). The survey response was also higher and came in at 42% (2021: 38%). The Fund is positive about the upward trend in results. At the same time, the Fund plans to develop a programme with the aim of continuing this trend. The Fund’s target is to obtain a score of at least 7.0.

Percentage invested in Convenience retail

The Fund's focus is on helping to create the city of the future, a city that is liveable and accessible to all. It wants to identify and help create Experience and Convenience shopping destinations that are fit for purpose today and that will remain so long into the future. Therefore, the Fund set a target to invest 40-60% in this segment. By the end of 2023, 43% of the portfolio was invested in Convenience retail. 

Healthy and safe areas: heartsafe

Bouwinvest was the first company in the Dutch real estate investment sector to contribute to the establishment of a national AED (automatic external defibrillator) network, which it is estimated could save up to 2,500 lives every year in the Netherlands. The use of an AED offers the highest probability of survival within the first six minutes after a heart attack. At the end of 2023, 100% of the Fund's tenants and communities had an AED available within six minutes walking distance.

4. Contributing to healthy, safe and good working conditions

Considerate constructors scheme (construction sites) 

All the construction sites related to assets in the Hotel Fund are registered under the Dutch Considerate Constructors Scheme (‘Bewuste Bouwers’). This ensures the contractor deals with the concerns of local residents and addresses safety and environmental issues during the construction phase. The target was to have more than 75% of the Fund's construction sites registered under the Considerate Constructors scheme by the end of 2023. However, at the end of 2023 the Fund has no construction sites. 

EU Taxonomy

The Fund’s investments are in Taxonomy-eligible economic activity, namely the ‘acquisition and ownership of buildings’. We take into account all standing assets that are the whole year in portfolio. The Fund choose for its activities for substantial contribute to the mitigation of climate change (article 10 of the Taxonomy Regulation) or to the adaptation to climate change (Article 11 of the Taxonomy Regulation). At the same time the activities do not significantly harm other environmental objectives and are carried out in compliance with the minimum safeguards. The calculation uses asset-level data for the Green Asset Ratio (GAR). The graphs below show the results expressed in GAR, turnover, OPEX and CAPEX which are calculated on the basis of the corresponding (sustainable) assets. This results in only 22% of the assets are in line with the EU taxonomy of which 18% of the considered assets are aligned with the definition of substantial contribution to climate change mitigation and 4% of the considered assets are aligned with the definition of substantial contribution to climate change adaptation. All are in compliance with the minimum safeguards.

Taxonomy alignment of investments