Start to measure something and improvement becomes inevitable. The metrics become a basis for engagement with stakeholders and the wider community.
How important is indoor environmental quality or IEQ to a Global Real Estate Sustainability Benchmark score? And how many GRESB points might be available for best practice performance in IEQ?
It makes sense to wholeheartedly embrace the GRESB philosophy that measuring environmental, social and governance or ESG performance is just the start of a conversation between asset managers and investors.
Like many things in life, if you start to measure it then improvement becomes inevitable, and the metrics become a basis for engagement with stakeholders and the wider community.
This also happens at the asset level. By measuring parameters associated with IEQ for the purpose of a rating, facility managers become interested in the process of improving the rating score and engaging positively in management techniques and capital investment required to improve the relevant parameters.
Before jumping into the analysis, it is important to note that it is possible to address these questions from an office perspective, ignoring other property types for the moment.
How IEQ can influence your GRESB score
IEQ on its own is but one small part of a portfolio’s potential GRESB score – touching seven of the 50 or so indicators across four of GRESB’s seven aspects (ignoring the optional health and well-being supplement and new construction module, for the time being).
What we found most interesting, and of particular importance to improving your overall GRESB score, is that gaining some additional points doesn’t really require top IEQ performance, only demonstration that you’re measuring it and working to improve it.
Overall IEQ could be worth a whopping 10 per cent of a GRESB score. Here’s how that works:
- There are 136 GRESB points available in total
- 13.5 points (10 per cent) are available through taking measures related to IEQ
- In the building certification aspect, indicators BC1.1 and BC1.2 are worth a combined 12 points
- For example, in Australia, you’re already doing NABERS Energy ratings so adding NABERS IE and one other NABERS rating (either waste or water) upgrades to a NABERS multi-rating certificate, where you can pick up those 12 points
- In other countries, you might undertake a WELL rating or Fitwel rating, both heavily influenced by IEQ parameters, and find 12 points that way
- There are 1.5 points pertaining to IEQ measures spread over five other Indicators (see the below table) – examples include conducting technical assessments for health and wellbeing including IEQ (R04) or including IEQ in standard lease contracts (SE10.1)
It does seem like a no brainer in Australia to go for the NABERS multi rating certificate, though we note that only a few leading asset managers are presently pursuing multiple NABERS ratings on a portfolio wide basis.
No doubt your present GRESB score might already include points in the indicators highlighted, however, it’s strongly recommended you review the table below to understand the impact of IEQ in the context of your portfolio.
All of the indicators touching on IEQ are important and there are good arguments to support that GRESB is correct that the strong weighting for building certifications is justified.
And while this article has focused very much on scoring points, here is a final thought: ratings and scores are a means to an end – to improving outcomes, they are not, and should not be viewed as, the end itself.
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Michael Taranto has been director of QED Environmental Services since 2015.
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