Nuveen Real Estate commits to net zero carbon global portfolio by 2040

• Commitment puts Nuveen Real Estate ten years ahead of Paris Accord targets
• The firm currently manages c. $133 billion of assets worldwide, and has made this pledge across all existing and future assets
• Real Estate pathway is part of Nuveen’s broader commitment to addressing climate risk across its $1trillion+ investment portfolio

Nuveen Real Estate, one of the largest real estate investment managers globally, has publicly committed to making the global property portfolio it manages, worth $133 billion, operationally net zero carbon by 2040.  

The ambitious target exceeds the commitment that the World Green Building Council states is necessary to meet the Paris Accord, by a decade.

Michael Sales, CEO, Nuveen Real Estate and Real Assets, said: “Our net zero carbon pathway makes a bold, clear commitment to achieving net zero across our global real estate portfolio by 2040. We believe this is essential to create a better world for future generations, but it will also help mitigate climate risk across our real estate strategies and future-proof our investments.”

Abigail Dean, Global Head of Strategic Insights at Nuveen Real Estate, commented: “ESG has sat at the heart of our investment strategies for well over a decade. As the world moves towards a net zero carbon future, governments around the world will, rightly, increase environmental regulations to achieve this, but we believe it is important to move towards this target as soon as possible. That is why we are proud to have committed to achieving net zero carbon across our entire global real estate portfolio no later than 2040, ahead of these broader targets. 

“We work with a broad range of institutional clients and blue-chip occupiers and share their sustainability aspirations. Our pathway provides a route-map to net zero carbon through real estate, touching upon numerous other industries at the same time, and aiming to achieve carbon savings of up to 50-80% for a traditional real estate asset.” 

Nuveen Real Estate’s platform covers a broad scope of strategies – equity, debt and development – and locations, meaning it has had to align closely with its clients to provide a pathway that benefits them in terms of performance and aligns with their own ESG targets. The firm sees direct correlation between improved sustainability credentials and a protection of value at asset level. 

Across its $133 billion portfolio, Nuveen Real Estate has committed to reviewing each asset and creating a net zero business plan for every building, ensuring buildings operate as energy efficiently as possible and work alongside occupiers to guarantee tenant emissions are aligned and included in a building’s net zero carbon strategy. 

“Although some measures are relatively easy to implement, there are still some big challenges for the real estate industry in reaching net zero, particularly in the standardisation of measurement and the collection of data. Landlord and tenant collaboration will be key to overcoming these hurdles.

“Having a global portfolio has allowed us to adopt some of the measures we have taken in Europe in the U.S., but it is important that local and federal governments provide clear standards for the industry in order for occupiers, landlords and developers to more easily implement sustainability strategies. It is expected that the appointment of the Biden Administration and the progression of the strategy to tackle climate change will herald a new era. We understand the importance of achieving this target and believe that we can be trailblazers in helping to achieve a net zero carbon economy globally”, added Dean.

A focus on energy reduction has been the bedrock of Nuveen’s approach to sustainable real estate investment and management for well over a decade. In 2020, for example, the firm was recognised by the U.S. Department of Energy as a Better Buildings Challenge Goal Achiever for outperforming its  10-year commitment to reduce portfolio-wide energy-use intensity by at least 2% annually, across its 30 million sq ft of U.S. real estate portfolio.

In 2019, Nuveen, alongside its parent company TIAA, created a Climate Risk Task Force in order to understand climate-related risks across its entire business and develop recommendations on governance, risk management processes, disclosure and measurement. It was subsequently named to the UN Principles for Responsible Investment (PRI) 2020 Leaders' Group for its strong climate reporting. All Nuveen investment professionals receive training on climate risk in order to facilitate integration into investment decision making across the firm, globally.

You can read Nuveen Real Estate’s full net zero carbon pathway here.