Investors‘ FAQ (Status May 2022)
Is sustainability part of our corporate strategy?
Yes, it is.
As one of Germany’s leading listed real estate companies, Branicks Group AG has committed to a sustainable development: To ensure its long-term financial success, the company’s senior management attaches great importance to ESG aspects (“environmental, social, governance”) in addition to economic themes.
Sustainability and ESG have therefore been a fundamental and integral component of our corporate strategy since 2010. In 2021, we expanded our 360-degree approach true to the claim “know how and know why” to include four clear beliefs on E, S, G and digitisation, and repositioned the company for optimal ESG alignment in organisational terms.
How does Branicks Group AG report on its sustainability activities?
Since March of 2011, Branicks Group AG has published its own annual Sustainability Report. As a publicly traded company, we orient ourselves to the internationally recognised reporting standards issued by the Global Reporting Initiative (GRI standards) and by the European Public Real Estate Association (EPRA sBPR). Our report is compiled in accordance with the “Core” option of the GRI standards.
As one of Germany’s leading listed property companies, Branicks Group AG participates in the established ESG ratings to measure its performance.
To view our rating scores, click here.
Is there a clear organizational anchoring of ESG in the company?
Yes, it is.
The senior management (CEO/CFO) of Branicks Group AG is responsible for the sustainability topic. Since 2021, the Head of Sustainability has masterminded and coordinated the company’s sustainability activities as well as the ESG reporting processes and contents, reporting directly to the CEO. In addition, an ESG Committee was set up in 2021 whose members include, aside from the CEO and the Head of Sustainability, the heads of all corporate units, so as to integrate all departments when making important decisions regarding the ESG strategy alignment and the ESG targets.
The operational implementation and application of the ESG measures is the responsibility of each organisational entity.
Is sustainability part of the real estate product strategy?
Yes, it is.
Branicks Group AG has pooled its proprietary Commercial Portfolio and the managed properties from the Institutional Business segment in a single real estate management platform.
(LINK: For details on the current assets under management, please see the financial reports of Branicks Group AG)
On the basis of our company-wide 360-degree value-add approach (MATCH – TRANSACT – OPERATE – DEVELOP), we developed an ESG management approach for our properties and funds that covers everything from the first matching (MATCH) to the initiating and structuring of transactions (TRANSACT) all the way to the operation of the real estate (OPERATE) and to upgrades and refurbishments (DEVELOP).
In our Institutional Business, we design innovative products and convince our investors of their concepts (MATCH) in close collaboration with our third-party alternative investment fund management (AIFM) companies.
In a parallel effort, we acquire the right kind of assets in order to sell them at a profit when the opportunity presents itself (TRANSACT). Moreover, we practice an active management of the respective (fund) products based on their investment strategy (OPERATE) and, subject to the investors’ consent, pursue the development of individual investments and properties (DEVELOP).
In the context of fund products, we are guided by the respective fund investment strategy and the specific ESG characteristics (MATCH) as well as by investor decisions regarding special ESG measures or ESG ratings (e. g. GRESB, ECORE).
The annual review on all levels, from the corporate level down to the building level, serves as a major steering instrument.
What criteria/objectives with an ESG character do you use for the portfolio and as part of the investment?
We orient ourselves to the existing laws and regulatory frameworks (e. g. energy, Sustainable Finance Disclosure Regulation) when deriving our criteria and targets while also taking input from the open exchange with our stakeholders into account.
The environmental topics “energy and energy efficiency,” and therefore the topics “emissions and decarbonisation” as well, represent material topics identified by Branicks and its stakeholders.
The tasks of rolling back CO₂ emissions and reducing the environmental issues count among our priorities. We want to contribute actively to the decarbonisation of the European buildings sector, and in 2022 defined a measurable climate target toward this end. Another material ESG target of Branicks Group AG is to expand the share of “green buildings” in its existing property portfolio, which was implemented when we issued the company’s first ESG-linked promissory note over the amount of EUR 250 million in 2021 with this specific target in mind.
Are building certificates (DGNB, BREEAM, LEED, etc.) used for external quality assurance?
Building certifications (under the DGNB, LEED and BREEAM regimes) are one of several external quality assurance tools Branicks Group AG uses, but they are neither exclusive nor applicable in all circumstances. We are making pinpoint use of the building certification tool depending on asset class, year built, the choice of new-build versus standing property, investment strategy and ESG strategy.
In addition to in-house quality assurance by our experienced management, we are also relying on tools like due diligence (DD) examinations and the technical due diligence (TDD) and ESG due diligence components. This goes for acquisitions in particular.
Additional management approaches include ESG portfolio ratings like ECORE and, in future, the scoring models of our AIF management companies or else our own in-house scoring models, which integrate property-, portfolio- or fund-relevant requirements. In addition, regulative provisions play a role, e. g. those from the Sustainable Finance Disclosure Regulation and the Taxonomy Regulation.
Is sustainability anchored in the investment process?
Yes, it is.
Conducting an ESG due diligence is an integral component of our acquisition process.
Before green-lighting a given property for acquisition, Branicks conducts an ESG due diligence to assess the energy efficiency and other energetic parameters of the building and the resulting environmental impact (e. g. CO₂ emissions). The potential for green building certifications and the fulfilment of ESG characteristics by a given fund, as the case may be, is examined for each investment asset and confirmed by third-party experts.
Is the company involved in ESG-relevant networks?
We participate actively in national and international sustainability initiatives of the real estate industry. In this context, our goal is to anchor sustainability-related subjects even more firmly within our organisation, and to promote the exchange of experience and information within our industry.
Together with other industry players, we engage in efforts to boost awareness for real estate businesses and their concerns, especially in the trade associations German Property Federation (ZIA) and European Public Real Estate Association (EPRA). Our membership in the European Association for Investors in Non-Listed Real Estate Vehicles (INREV) underlines the significance of third-party business in our Institutional Business segment.
On top of that, Branicks Group AG is part of the ECORE–ESG Circle of Real Estate, an initiative to advance the ESG compliance of real estate portfolios. The ECORE members developed a scoring standard for making sustainability in real estate portfolios transparent, measurable and comparable. This constitutes the basis for the continuous optimisation to achieve CO₂ neutrality. The Branicks Group has already been involved in the development of a European standard for measuring the sustainability performance of properties and portfolios since 2020. Between February and May 2021, Branicks took part in the ECORE piloting with selected properties in order to subject the developed ESG scoring model to a field test and to actively support its further development into a future-ready ESG assessment model for buildings and funds.
We are moreover in close dialogue with our AIF management companies (German “KVG”). Our ambition here is to play an active partner role in the structuring of a given fund product and to contribute the experience we gained through the active management of third-party real estate assets in our care, and through the ESG management of our proprietary real assets.