REDEVCO S VIEW ON BREEAM IN-USE. Derk Welling Head of Sustainability. Nationaal BREEAM congres MARCH 2017

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1 REDEVCO S VIEW ON BREEAM IN-USE Nationaal BREEAM congres 2017 Derk Welling Head of Sustainability 17 MARCH 2017

2 7,1 billion combined portfolio value 405 assets under management 2,204 leases 3.2 million total lease area (m2) 81% of invested volume BREEAM certified > 400 certificates Redevco is an investment management company specialised in retail real estate. It is our aim to maximise the performance of the various portfolios we manage for multiple investor clients. January

3 REDEVCO & BREEAM Selected BREEAM is the preferred tool to certify our new developments as of 2007 Initiated development of BREEAM Europe Retail which was launched in Oct 2008 Co-initiated launch of DGBC to promote BREEAM in the Netherlands Supported launch of BREEAM ES Supported launch of BREEAM DE CH AT Tested pre-launch version of BREEAM in Use in 2008 First BREEAM in-use certificates in 2011 To date: more than 400 BREEAM in-use certificates

4 GOUDA 2011

5 GOUDA 2012

6 ZAANDAM 2013

7 ZAANDAM 2014

8 BREEAM IN-USE CAN BE USED AS Reporting tool (public report, internal reporting, client reporting) Benchmarking tool Asset Management tool Tenant engagement tool Software tool FOR US IT IS NOT ABOUT CERTIFICATION BUT BUSINESS IN BALANCE ALL ABOUT CONTINUOUS IMPROVEMENT December 20168

9 OUR PARTNERSHIP WITH SOCIETY PUBLISHED FIRST PUBLIC SUSTAINABILITY REPORT IN ACCORDANCE WITH GRI GUIDELINES IN DUTCH REAL ESTATE SECTOR SOCIAL ECONOMIC ENVIRONMENTAL Business in Balance Directors' Meeting Brighton 9

10 BREEAM METHODOLOGY HAS CLEAR LINK WITH TOPICS ON OUR MATERIALITY MATRIX January

11 Share of investment volume [%] REVISITED OUR STRATEGY IN 2013 AIMING AT 10 CERTIFICATION MAKE DISTINCTION BETWEEN 2 STAGES Make distinction between 2 stages 1. Certification stage : establish proper, harmonised building dossier and procedures 2. Improvement stage: annual audit based on sample (square root method applied to complete portfolio) e.g. portfolio of 450 properties => annual sample of 22 properties to be reviewed 10 Stage 1: towards 10 certification Stage 2: improve by setting targets for BREEAM ratings Years BREEAM Certified Not certified Acceptable Years Pass Good Very Good Excellent Outstanding

12 CREATED ACTION PLANS WHICH SERVE AS INPUT FOR ASSET BUSINESS PLAN Primary aim is to ensure that sufficient CAPEX and OPEX is available to execute the planned BREEAM improvements and/or remove asbestos and set realistic targets (bottom-up)

13 MOVING THE NEEDLE: TARGETING 35 IMPROVEMENTS IN 2016 (2015: 10)

14 TOWARDS A GREEN PORTFOLIO ALLOCATION OF INVESTMENT VALUE OVER BREEAM PERFORMANCE ALL AUM CERTIFIED ACTUAL % 10 OUTSTANDING EXCELLENT VERY GOOD GOOD PASS ACCEPTABLE ACTUAL 2021 ACTUAL 2021 ACTUAL 2021 ACTUAL 2021 ACTUAL 2021 ACTUAL % 2% 5% 34% 4 49% 24% 14% 1% 1% % 31% 7 69% 4% 66% 10 7% 13% 6% 45% 18% 32% 32% 8% 3% 2% 42% 10 11% 55% 31% 39% 6% 75% 10 6% % 29% 34% 91% 10 34% 83% 48% 7% 9% 1 87% % 25% 71% 65% 63% 10 57% 59% 43% 4% 14

15 BENCHMARKING RETAIL PORTFOLIOS INTERNALLY AND WITH BREEAM AVERAGE SCORE Portfolio I Portfolio II Portfolio III Portfolio IV MATERIALS 63% 5 53% 35% 25% ENERGY 49% 31% 41% 29% 14% POLLUTION 48% 3 42% 41% 18% WATER 32% 21% 27% 25% 9% HEALTH & WELLBEING 57% 33% 43% 31% 15% WASTE 8 59% 58% 35% 25% LAND USE & ECOLOGY 2 1 8% 6% 1% TRANSPORT 76% 49% 67% 57% 25%

16 PORTFOLIO III UNDERPERFORMS THE BREEAM AVERAGE SCORE Portfolio III AVERAGE SCORE MATERIALS 63% 35% 57% 38% not certified 23% 24% 39% 71% ENERGY 49% 29% 55% 38% not certified 13% 26% 3 56% POLLUTION 48% 41% 42% 51% not certified 46% 4 37% 55% WATER 32% 25% 33% 44% not certified 19% 22% 2 14% HEALTH & WELLBEING 57% 31% 28% 43% not certified % 5 WASTE 8 35% 25% 56% not certified 34% 2% 35% 10 LAND USE & ECOLOGY 2 6% 2 not certified 3% 13% TRANSPORT 76% 57% 7 73% not certified 49% 52% 56%

17 % 72% 47% 76% 35% 44% 41% 6 63% 71% 66% 64% 41% 58% 64% 65% BENCHMARK 41% 45% 33% 56% 34% 29% 32% 52% 49% 46% 48% 54% 41% 53% 37% 52% BENCHMARK 44% 43% 47% 39% % 41% 48% 42% 5 46% 68% 35% 44% 44% BENCHMARK 23% 31% 35% 16% 29% 21% 21% 15% 32% 31% 41% 32% 37% 34% 35% 2 BENCHMARK

18 IMPROVE BREEAM RATING LEVERAGE INFLUENCE UP AND DOWNSTREAM SUPPLIERS TENANT Include BREEAM criteria in purchasing contracts Ensure external property managers have incentive to improve BREEAM rating Ensure sufficient budget (CAPEX/OPEX) avaialable in ABP Incorporate BREEAM criteria in Governance, Risk & Compliance framework Tenant Toolkit Include clauses in lease contract

19 COSTS CAN BE LOWERED TO EURO A YEAR BREEAM IN USE SHOULD BE CONSIDERED AS A SOFTWARE TOOL Improvements all certificates Fee Audit sample Evidence 1 st certification Continuous Improvements

20 FROM INCONSISTENT RECERTIFICATION DATES

21 TOWARDS FIXED RECERTIFICATION ANNUALLY

22 WE ARE HIRING SEARCHING FOR A SUSTAINABILITY ANALYST

23 THANK YOU FOR YOUR ATTENTION