What are ESG funds?
ESG stands for the three criteria: Environment, Social and Governance, which indicate the three most important characteristics for determining the sustainability of an investment. The ESG criteria provide investors with information on how sustainable an investment is.
Sustainability refers not only to ecological aspects here, but also to social aspects. Funds with a corresponding ESG approach therefore ensure that investments take environmental and social aspects into account, as well as corporate governance issues.
Studies have shown that the consideration of ESG criteria can have a long-term positive influence on the corporate concept and the financial success of an investment. So-called transition risks (e.g. regulatory changes) in particular can be significantly reduced. These risks are non-linear and can be extremely costly if not adequately addressed.
Why we look for sustainability in real estate
A glance at the figures shows that sustainability – and in particular ecological sustainability – is more important in the real estate sector than ever before. The reason for this: Buildings in the EU alone are responsible for 40% of energy consumption and 36% of greenhouse gas emissions.
With the “Green Lease” concept, the GBI Group is committed to sustainable project development. Social and economic aspects are mutually considered, in accordance with the purpose of the Moses Mendelssohn Foundation.
We certify our building projects according to the latest standards and incorporate future legislative changes aimed at climate protection. We consistently implement energy-saving concepts. Emissions and waste are reduced and we strive to minimise consumption in construction and operations.
The KfW 55 Standard is achieved in all residential projects as a minimum, and the possibilities for realising KfW 40 are intensively reviewed.
The advantages of ESG funds at a glance
An ESG fund comprises the following factors:
| Tenants | Owners | Properties | |
| Environmental | Low ancillary costs due to low energy consumption | Stable performance because the importance of energy efficiency will increase | KfW Efficiency House 55 or better |
| Social | Affordable subsidised housing | Stable and secure rental income because there is little fluctuation and vacancy in the subsidised segment | Public transport links, car sharing |
| Governance | Green Leases | Good reputation due to sustainable buildings and affordable rents; negative effects of future regulations are reduced | Green reporting & audits |
Acquisition profile of the ESG fund
In 2021, GBI launched an ESG housing fund together with a renowned partner, meaning that we will also be acting as an end investor in the future. Sustainable investments support adaptation to climate change, environmental protection and the fight against social injustice.
We are therefore making a positive contribution to the environment and society. For our fund, we are seeking appropriate projects from the following areas:
Subsidised housing and student accommodation
- Locations in Germany
- At least 10,000 residents and / or city commuter areas
- Mainly Bavaria, Baden-Württemberg, NRW and Hamburg
- Cities with positive population development
- From approx. 50 units
- Residential areas with a balanced social structure
- Good transport connections for private and public transport
- Student accommodations without operators or with non-profit operators
Portfolio properties
- Good tenant structure (less than 10% vacancy)
- Good building fabric
- Acquisition of properties with subordinate commercial use (quota 30%) possible
- Portfolios
Project development
- Forward deals & forward funding
- Conclusion of purchase contract after planning permission
- KfW 55 Standard as a minimum
- High degree of space efficiency, economical floor plans
- Free of pollution legacy
- Acquisition of properties with subordinate commercial use (quota 30%) possible
- Acquisition of properties with subordinate privately financed housing possible
- Portfolios