Ayala Land Inc’.s AREIT and Italpinas Development Corp. (IDC) are walking the talk in championing a sustainable future.
AREIT Inc. (AREIT), the pioneer real-estate investment trust (REIT) in the Philippines, is committed to the Environmental, Social, and Governance (ESG) principles through sustainability programs that will deliver the most benefit to the community and support its path towards carbon neutrality and net zero emissions. It is also on track towards finishing its Scope 1 and 2 emissions by the end of the year, while moving towards Scope 3 and net zero emissions from operations of its existing buildings by the end of 2022. Scope 1 emissions are greenhouse gas (GHG) emissions coming from the use of fuel such as those in generators and vehicles. Scope 2 refers to emissions coming from electricity consumption in common areas controlled by AREIT, while Scope 3 refers to other emissions from AREIT’s value chain.
“As a sustainable REIT, we believe that moving towards net zero carbon operational emissions is the most impactful environmental initiative we can undertake. By using renewable energy in our buildings, we not only achieve AREIT’s ESG objectives, but also enable our building locators, many of whom are top multinational corporations, to achieve their own ESG standards,” AREIT President and CEO Carol T. Mills told the BusinessMirror in an e-mail interview.
AREIT’s Makati-based buildings, Solaris One, Ayala North Exchange and McKinley Exchange, and The 30th Corporate Center in Pasig, have converted from using coal to renewable-energy sources. The company expects to reduce 80 percent of its 10,000 tCO2e (tonnes of carbon dioxide equivalent) business-as-usual emissions through the use of renewable energy, while the remaining 20 percent will be offset through AL’s carbon forests.
Mills said the ESG strategies are implemented across all its managed properties based on the four sustainability focus areas of its sponsor, ALI: 1) site resiliency through responsible green masterplanning, 2) pedestrian mobility by enhancing transit connectivity and the commuter experience, 3) resource efficiency by minimizing energy waste and environmental footprint, and 4) local economic development through the economic value generated by its business and its locators.
Environmental programs that make a difference
AREIT’s properties have allocated open and green spaces to provide a healthy environment for the community, as well as a place for safety or refuge in the event of emergencies. Further, the properties feature District Cooling Systems (DCS) which helps decrease electricity consumption by 20-35 percent compared to regular cooling systems. A lot of AREIT’s buildings are also Leadership in Energy and Environmental Design (LEED)-certified, such as the Teleperformance building in Cebu, One Evotech in Nuvali and Vertis Corporate Center in Quezon City.
AREIT also reduced its carbon emissions continuously through significant shifts to renewable energy, and by allotting compensation for fuel consumption through ALI’s carbon forest stock. Its measured electricity intensity for its buildings in 2020 has improved to 125.48 kWh/sq m, which is much lower than the Asean benchmark of 160 kWh/sq m.
A growth catalyst
AREIT’s office buildings are also economic growth drivers by attracting international and local business locators to its properties. These locators have contributed an estimated P6.2 billion to P9.8 billion in capital expenditures to the country’s economy. The top locators from the business-process outsourcing (BPO) altogether have generated more than 100,000 Filipino jobs.
The company advocates good corporate governance that sustains value for all its stakeholders. Transparency, disclosures and compliance with REIT Rules are adhered to, including best practices on internal control and professional management to safeguard its assets. AREIT also established a Board Sustainability Committee to provide oversight and strategic direction for its sustainability practices and ESG initiatives.
“While we remain very focused on AREIT’s key investment fundamentals namely: prime locations, stable occupancy of quality tenants, contracted escalations, professional management experience, as well as ALI’s sponsor track-record, we believe that working towards carbon neutrality and net zero emissions will advance AREIT towards becoming a truly green and sustainable REIT,” Mills said.
All-around sustainability
Romolo Valentino Nati, executive chairman and CEO of IDC, believes sustainability will become more and more important for developers to pursue in the future.
For IDC, Nati said the concept of sustainability must start from the understanding that resources are not infinite. “We need to find ways to satisfy the needs of the present generation without compromising the ability of future generations to meet their own needs in due time,” Nati said.
On top of that, builders must also understand that everything they do has an impact on the environment. As the indigenous Native American saying goes, we do not own the world, we just borrowed it from our children.
Nati pointed out in an interview with the BusinessMirror that sustainability also covers social sustainability and financial sustainability. “All those things must go together,” he said.
He also sees sustainability as an opportunity rather than a threat. It is an opportunity because it will lead developers and in general investors in all sectors, to become more conscious about sustainability and allocate more resources to achieve that. Nevertheless, it is a potential threat because it can be used by companies as a mere empty marketing tool that could lead to greenwashing creating false solutions and misled advocacy. This could even lead to more consumption of disposable material if marketers and social media use a greenwashing message to spur demand for altogether new classes of “stuff” for sale, in addition to what is already in use.
He also urged developers to get a reputable third-party organization to guarantee the end-user of a product’s commitment and concrete contribution to sustainability.
Doing it the IDC way
Every IDC project begins with an assessment of the site’s characteristics. This includes elevation, latitude, wind data, topography, and other physical traits that the final building will harmonize with. The assessment also considers more subjective assets that the site may have. For example, the stunning view of Mount Makiling from Miramonti Residences, or the sweeping vista from high hills to Macalajar Bay from IDC’s Primavera City.
Since every project is unique, IDC strives to optimize the site and its conditions. This is where development is an art and not just a process.
In order to have a positive impact on the environment, IDC believes there is a need to adopt green development principles on a massive scale. Although it is a huge challenge especially when consumers are distracted by so many other options, the obstacle can be overcome by showing that green is not only more efficient, but also more comfortable, more beautiful, and more harmonious. “We deliver the proof of this in the form of our actual tangible structures at the right price point. This is what we offer to the Philippine real-estate market,” Nati said. Nati also pointed out that price point is also an essential part of the solution. He said IDC aims to make green buildings more accessible.
Images courtesy of Utente di Microsoft Office and Rolly Barayang
Read full article on BusinessMirror