Environmental Activities (E)
The GLP Group's fundamental approach to facility design and operational processes is energy-saving. We strive to improve energy efficiency in both existing facilities and new facility developments. In accordance with the above policy, GLP J-REIT actively owns environmentally friendly buildings and introduces eco-friendly equipment, as well as develops rules for checking sustainability and environment protection items in the due diligence process when considering the purchase of a property. Thus, it takes utmost care in that its asset management operations pay consideration to the sustainability of society and environmental protection. At the facilities it operates, GLP J-REIT sets numerical targets and monitors the amount of energy and water used within the facility as well as the amount of waste. Furthermore, GLP J-REIT not only strives to save energy and reduce waste in common areas but also shares information on the amount of energy used and waste with tenant companies in an effort to reduce environmental load together with tenant companies by issuing an energy-saving guidebook according to energy use and recommending to stop idling engines within facility premises.
Initiatives towards Climate Change
We recognize that climate change is a material global issue and medium-to long-term risk. GLP J-REIT is working on mitigation of climate change together with GLP Japan Advisors Inc., the asset manager of GLP J-REIT, by reducing greenhouse gas emissions and adaptation of climate change for creating opportunities to achieve carbon neutrality by 2050 which is committed by GLP group.
Expression of Support for TCFD Recommendations
In August 2021, GLP Japan Advisors Inc., the asset manager, has signed off as a supporter of the Task Force on Climate-related Financial Disclosures (TCFD) , a body established by the Financial Stability Board, and participated in the TCFD Consortium, a group of domestic companies that support TCFD recommendations.
The TCFD released a final recommendation report to encourage voluntary, consistent climate-related financial risk disclosures for use by companies in providing information to investors, lenders, insurers, and other stakeholders.
The TCFD Consortium is an organization that was established with a view to encouraging concerted efforts by companies and financial institutions that support the TCFD and discussion of effective corporate disclosure and initiatives that link disclosed information to appropriate investment decisions on the part of financial institutions and other organizations.
For information regarding the implementation structures relating to ESG (here and hereafter, including responses to climate change) of GLP Japan Advisors Inc., the asset manager, refer to the “ESG Policy / ESG Promotion Structure” page.
GLP J-REIT took into consideration the following multiple scenarios in order to identify risks and opportunities relating to climate change risks that will affect it and to investigate the effects of these risks on its business.
- 1.5/2 °C scenario (significant impact from regulations)
A scenario in which laws and regulations are tightened to control climate change
- 4°C scenario (great impact of climate change)
A scenario in which natural disasters grow serious because of delays in addressing climate change
Identify risks and opportunities
|Category||Risk and Opportunity Factors||Financial Impacts||Type|
|Policy||Strengthening of energy conservation standards for buildings, reduction of the cost of energy creation and energy conservation through the evolution of technology||Accrual of retrofit costs to improve environmental performance||Risk|
|Reduction of water and utility costs through improved environmental performance||Opportunity|
|Introduction of carbon taxes, introduction of emissions trading systems||Increase in operating costs due to introduction of carbon tax, etc.||Risk|
|Disclosure systems relating to building energy efficiency assessments expanded and made mandatory||Accrual of costs for acquisition of environmental certification, etc.||Risk|
|Market||Changes in the stance of investors and lenders due to growing ESG awareness||Increase in investment opportunities by ESG-conscious investors, lower financing costs through ESG financing||Opportunity|
|Increase in companies that seek carbon neutrality||Higher occupancy rates at energy-generating and energy-conserving buildings||Opportunity|
|Reputation||Tenants' selection of properties with emphasis on environmental performance|
|Tenants’ selection of properties with BCP-oriented||Lower occupancy rates at buildings with high disaster risks||Risk|
|Acute||Increases in intense rain, storms and flooding, landslides, and high tides||Loss of business opportunities due to damage to buildings, increase in repair costs and insurance premiums||Risk|
|Chronic||Climate change, such as rising temperatures and sea level rise|
The risk management systems relating to sustainability of the asset management company to which GLP J-REIT has entrusted operation of its assets are as set forth below.
At the time of investment decision
When making new investments in assets under management, we conduct sustainability-focused due diligence to verify sustainability-related risks, including climate change risks, and make investment decisions at the Investment Committee after discussions at the ESG Committee.
The ESG Committee performs management and monitoring of overall risks relating to sustainability including climate change risks. Specifically, we monitor the environmental performance of the properties GLP J-REIT owns, manage progress toward various targets (see “Metrics and Targets" below for details), and consider necessary measures based on these as appropriate.
Metrics & Targets
Initiatives in renewable energy
Solar power generation facilities
Wind power generation
Initiatives in energy-saving
Updating air-conditioning equipment
Promoting the acquisition of energy-saving examinations
GLP Atsugi II
Initiatives in water resources
GLP J-REIT makes efforts to save water by updating toilet equipment when tenants move in or leave, and by using rainwater and well water.
Water-saving by updating toilet equipment
Installation of water-saving devices.
By installing water-saving devices, the amount of water that comes out of the faucet when the tap is twisted can be reduced.
Water-saving by using well water and rainwater
In an effort to save water, well water and rainwater are used to drain toilets as well as to water the plants in the facility.
Initiatives in waste management
Formed a business alliance with Hyperion, the operator of the second-hand logistics equipment purchase site "Matebank," and sold cheaply when moving in (purchase price 5-10% OFF) and expensive purchase when moving out (purchase price 5-10% UP). Realized. We support the cost reduction associated with the relocation and move-out of residents.
GLP J-REIT recognizes the importance of the various benefits that ecosystems bring about and works to preserve them by planting trees in our facilities.
Environmental considerations through collaboration with tenants and property managers
GLP J-REIT includes green lease clauses in standard lease contracts with tenants to reduce energy and water consumption, waste, and to collaborate in acquiring green building certification.
In addition, we carry out renovations to improve environmental performance in cooperation with tenants. We have been improving environmental performance and reducing running costs of properties through installation of LED lighting, air conditioning upgrades, and other works.
Environmental considerations through collaboration with tenants and property managers
In cooperation with tenants, facility managers (FM), and property managers (PM), GLP J-REIT is working proactively to reduce environmental load in our portfolio. Specifically, in addition to promoting the visualization of electricity consumption by sending meter data to our tenants, we are holding regular meetings with tenants and FM/PM and encouraging them to reduce engine idling and to save water and electricity etc.
Holding regular meetings with tenant and FM/PM
Consideration for the environment and regional revitalization in urban development
GLP Group develops facilities that are environmentally friendly and contribute to the regional revitalization.
Reduce environmental load through redevelopment
GLP Urayasu II
- Rebuilt and redeveloped an existing facility (B building) at GLP Urayasu II by GLP Group
- Upon redevelopment, the building acquired Rank A certification from CASBEE for Real Estate as it was able to reduce electricity use by installing LED lighting throughout the entire newly developed building and through large ceiling fans in air-conditioned areas
Consideration for the regional revitalization in urban development
The Group contributes to the revitalization of local economies and communities through the development of logistics facilities. For example, GLP ALFALINK Sagamihara is one of the largest logistics facility development projects in Japan, consisting of four logistics facilities and one common-area building on a vacant factory site in Sagamihara City, located in Greater Tokyo Area. Through the development, the project has generated various benefits for the region, including the creation of approximately 5,000 new jobs.
Before the development
After the development
（4 logistics facilities、1 common area building）
In developing the facility, we have created a comfortable working environment for the workers at the facilities, and GLP ALFALINK Sagamihara is the first ever logistics-related facility in Japan to receive WELL certification.
In addition, based on the concept of creating a logistics facility that is open not only to those who work at the facility, but also to the local community, cafeteria/restaurant in the facility is open to local residents, and a convenience store and café have been built inside the facilities. Furthermore, the facility hosts about 40 community events per year, attracting more than 10,000 visitors, which also helps to revitalize the local community.
cafeteria/restaurant open to local residents
Plaza and common building in ALFALINK Sagamihara
Examples of community events
When acquiring real-estate-related assets, etc., as a rule, experts conduct an environmental contamination survey prior to the conclusion of a purchase agreement, and the survey results will be evaluated and considered in accordance with the following “soil survey chart” based on the Asset Management Guidelines. Moreover, as a rule, our investment targets will be properties that are appropriately treated for soil contamination, etc., in accordance with the Soil Contamination Countermeasures Act (Act No. 53, 2002), other related environmental laws, and municipal ordinances or guidance.
In addition, GLP Group, including GLP J-REIT, conducts its own ESG due diligence when acquiring land, properties, etc., and checks in advance the impact on the environment and the community.
Soil remediation in redevelopment on contaminated sites
the Group conducts soil contamination surveys prior to the land purchase stage and does not normally find any contamination. In the exceptional case where soil contamination is found on a development site, the Group takes measures to remediate the soil and prevent the spread of contamination before developing the property. For example, in the development of logistics facilities on a former factory site in the Tokyo metropolitan area, minor contamination was found in some areas, and after identifying the extent of contamination, measures were taken such as replacing the soil with healthy soil. In such measures, we take measures to prevent soil contamination, such as installing water barriers as necessary to prevent the spread of contaminated soil outside the site.
Identification of the contamination
Replacement with healthy soil
Environmental considerations for development in undeveloped areas (green fields)
When developing logistics facilities in undeveloped areas, it is necessary to consider environmental impact of the development more carefully. GLP Group careful identifies risks through unique ESG-focused due diligence. Additionally, we have a policy of obtaining green building certifications to reduce the impact on the environment.