Environmental, Social and Governance (ESG) Policy
Our long standing mission is to deliver superior risk-adjusted returns over the long term for our investors.
Since 2011, Second City Real Estate (SCRE) and its affiliates have acquired over USD $1.75 billion in real estate. The firm utilizes a strategic, fact based and diligence-driven investment approach that by definition includes a multitude of environmental, social and governance (ESG) considerations.
SCRE believes these ESG practices lead to better investment outcomes while considering the firm’s broader impacts on the environment and society. The firm takes its responsibility seriously and continually monitors the broad consequences of every investment to ensure we are adequately taking our stakeholders’ needs into account.
When making private real estate investments, SCRE takes the following considerations into account:
- Environmental, public health, safety and social issues associated with targets when evaluating whether to invest in a particular property, as well as during the period of ownership. Remediation plans are created to mitigate any property specific issues.
- Proactively seeking opportunities to lower resource consumption, including water and utilities by making strategic capital investments.
- Being accessible to relevant stakeholders either directly or through representatives of property management companies, as appropriate.
- Strict adherence of all regulatory compliance as well as meeting elevated voluntary compliance initiatives (such as LEED, Energy Star, etc).
- Encouraging our property management firms to advance these same principles in a consistent manner and ensuring proper governance oversight covering risk management, personnel safety and potential conflicts of interest.
At SCRE, portfolio investment decisions are always made in the best interests of our clients. We strive to operate and improve our real estate in a best-in-class manner, with the goal of lowering water/energy consumption and providing high quality working/living spaces for our tenants. Supporting these investment decisions is the belief that prudent management of environmental, social and governance issues can have an important impact on the creation of long term investor value.
Specific examples of past SCRE ESG initiatives include:
- Replaced over 4,200 toilets with low-flow models that are estimated to generate net utility savings of $6.7 million over the next 10 years.
- Replaced numerous older/less efficient commercial chiller units with high efficiency models that require significantly lower energy for our office building portfolio.
- Retrofitted thousands of light fixtures and replaced with LED lights which are estimated to reduce energy consumption by ~60-80%.
- Upgraded elevators (where economically feasible) to a Destination Dispatch system which groups people based on their target floors. This results in both shorter elevator wait times for our tenants but also a reduction in energy consumption due to the efficiency.
- Installed 600 kW of solar panels on multi-family properties in Texas; estimated to produce 850,000 kWh per year.
- Separately metered utilities for residential apartments and required the tenants to directly pay based on their own usage. This has resulted in tenants being more disciplined about their utility consumption (versus the perception they are “free”).
- Installed Nest thermostats at various properties which has lowered overall electricity consumption.