Climate Change Data

Environmental Metrics

ESG Focus Areas

• Energy efficiency
• Climate change
• Stakeholder engagement
• Employee wellbeing
• Community investment

Environmental Achievements

• 18.3% reduction in total Scope 1 and 2 GHG emissions compared to the prior year
• 97.9% landlord-controlled electricity from renewable sources
• 20.5% reduction in absolute landlord-purchased water consumption
• 34.1% reduction in average building water intensity

Social Achievements

• No employees were furloughed during the pandemic
• Agreed rent concessions and deferrals of £1.1m to support tenants
• Charitable donations totalled £8,000
• Implemented ESG principles within asset management initiatives

Governance Achievements

• Appointed an external consultant to assist in formulating ESG strategy
• Implemented ESG principles within asset management initiatives
• Established three key ESG objectives: future-proofing the portfolio, fostering a culture of inclusivity, and being a responsible business

Climate Goals & Targets

Environmental Challenges

• Covid-19 pandemic and its impact on rent collection and property valuations
• Supply chain disruptions due to the pandemic
• Tenant financial difficulties leading to rent arrears
• Maintaining high occupancy levels during the pandemic

Mitigation Strategies

• Proactive engagement with tenants, offering rent concessions and deferrals
• Prudent maintenance of a healthy cash position
• Curtailed non-essential capital expenditure
• Close relationship with lenders, securing covenant waivers
• Strategic disposals of non-core assets
• Implemented social distancing measures in buildings

Supply Chain Management

Responsible Procurement

• Using contractors with strong safety credentials
• Participation in schemes such as the Considerate Constructors Scheme

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: EPRA Best Practice Recommendations

Certifications: BREEAM Excellent, WiredScore Platinum

Environmental Metrics

ESG Focus Areas

• Environmental
• Social
• Governance

Environmental Achievements

• Improved EPC ratings across the portfolio, with 88.8% of EPCs rated A-D (2021: 75.7%).
• Incorporated energy efficiency measures into major building refurbishments.
• Reduced Scope 1 and 2 GHG emissions.

Social Achievements

• Maintained close relationships with tenants, achieving 98% rent collection.
• Established a Workforce Advisory Panel to enhance employee engagement.
• Donated £20,000 to charities nominated by staff.

Governance Achievements

• Appointment of a new CFO and Chairman.
• Completed a Board performance evaluation.
• Continued to integrate ESG into risk management processes.

Climate Goals & Targets

Environmental Challenges

• Economic uncertainty due to rising inflation, rising interest rates, and the cost of living crisis.
• Supply chain disruptions and increased construction costs.
• Evolving regulatory requirements for energy performance certificate (EPC) ratings.

Mitigation Strategies

• Maintained a conservative capital structure and strong relationships with lenders.
• Implemented a targeted upgrade and retrofit program to meet minimum energy efficiency standards.
• Engaged with tenants to improve environmental performance and reduce energy usage.

Supply Chain Management

Responsible Procurement

• Overbury, the contractor for St James’ Gate refurbishment, has a ‘zero waste to landfill’ policy and uses local suppliers with strong ESG credentials.

Climate-Related Risks & Opportunities

Physical Risks

• Flooding and storm damage

Transition Risks

• Regulatory changes, market shifts

Opportunities

• Development of energy-efficient products and services

Reporting Standards

Frameworks Used: EPRA, TCFD

Awards & Recognition

• Gamechanger at the Yorkshire Property Awards
• RICS Regional Development of the Year

Environmental Metrics

ESG Focus Areas

• Environmental performance of assets
• Inclusivity and stakeholder interests
• Responsible business practices

Environmental Achievements

• 96.2% of the portfolio is now rated A-D on EPCs (31 March 2022: 88.8%)
• Removed all G rated EPCs and significantly reduced E and F ratings
• 100% landlord controlled electricity from renewable sources

Social Achievements

• Moved to more appropriate office space with improved access and facilities at significantly less cost
• Workforce Advisory Panel provides a forum for employee feedback to the Board

Governance Achievements

• Established a new Executive Committee
• Adopted a new Matters Reserved and Delegations of Authority Policy

Climate Goals & Targets

Environmental Challenges

• Economic and geopolitical uncertainty impacting the commercial property market
• Cost of living crisis affecting consumer sentiment and inflation
• Potential for business disruption due to unforeseen events

Mitigation Strategies

• Regular monitoring of market indicators and strategy review
• Sensitivity modelling to test the robustness of the financial position
• Conservative gearing strategy and debt repayment
• Strong relationships with key lenders
• Active asset management to maximize value
• Comprehensive insurance program

Supply Chain Management

Responsible Procurement

• Our contractors participate in schemes such as the Considerate Constructors Scheme

Climate-Related Risks & Opportunities

Physical Risks

• Asset damage from extreme weather events

Transition Risks

• Government policy changes
• Reputational impacts
• Market shifts

Opportunities

• Improved commercial opportunities from energy-efficient assets

Reporting Standards

Frameworks Used: Greenhouse Gas Protocol, DEFRA Environmental Reporting Guidelines (2013), TCFD

Environmental Metrics

ESG Focus Areas

• Environmental
• Social
• Governance

Environmental Achievements

• Reduced direct emissions under Scope 1 from own office usage due to smaller office with reduced consumption.
• 100% of properties now rated A-D on EPCs, with 81.0% rated A-C (2023: 96.2% and 72.2% respectively).

Social Achievements

• Relocated head office to smaller office in Victoria, London, reducing annual occupancy costs by £0.25 million compared to previous offices.
• Continued engagement with tenants, understanding their needs and supporting them throughout their business cycle.

Governance Achievements

• Established an ESG Committee to oversee ESG related matters and ensure these are integrated into the business model and corporate strategy.
• Implemented a Short Term Incentive Plan (STIP) to align management incentives with shareholder interests.

Climate Goals & Targets

Environmental Challenges

• Softening yields across the property portfolio, particularly in the leisure sector, leading to a revaluation deficit.
• Challenging property and financial markets, including rising interest rates and economic uncertainty.
• Difficult investment market for leisure assets, with limited liquidity and volatile valuations.

Mitigation Strategies

• Proactive asset management plans to increase income, reduce void costs, and improve ESG performance.
• Significant debt reduction, resulting in a net cash position.
• Selective marketing of assets and deferral of sales until market conditions improve.
• Active asset management initiatives to drive value and prepare assets for sale.

Supply Chain Management

Responsible Procurement

• Prompt payment to suppliers within agreed terms.

Climate-Related Risks & Opportunities

Physical Risks

• Flooding (minor risk)

Transition Risks

• Regulatory changes, increased energy efficiency requirements

Opportunities

• Improved EPC ratings leading to higher ERVs and capital growth.

Reporting Standards

Frameworks Used: Greenhouse Gas Protocol, DEFRA Environmental Reporting Guidelines (2019), TCFD