NIPPON REIT Investment Corporation

Securities code:3296

JAPANESE

Environmental Initiatives

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From the perspective of improving unitholders' value in the long term, NIPPON REIT recognizes that environmental consideration is an important issue in the real estate investment management business and works to reduce its environmental impact through measures such as the renovation of existing facilities and the improvement of the management of the properties held by NIPPON REIT. Moreover, NIPPON REIT aims to achieve environmentally friendly investment management by taking facility users’ comfort, biodiversity and other factors into consideration.

1. Energy Management

1-1. Premise

Based on the Sustainability Policy articles “1. Effort to save energy and reduce greenhouse gas emissions” and “2. Realization of a recycling-oriented society,” NIPPON REIT has set reduction targets for energy consumption and greenhouse gas emissions to improve the environmental performance of its real estate portfolio.
In order to achieve these targets, NIPPON REIT’s asset management company, SRA implements measures to improve the operational performance of buildings, conduct energy efficiency retrofits and engage tenants on energy efficiency based on its “Energy Conservation Policy,” which stipulates operational policies for improving energy efficiency of the real estate portfolio, and “GHG Emissions Reduction Policy,” which aims to create a low-carbon society.

1-2. Reduction Targets for Energy Consumption and Green House Gas

Sustainability Policy ①・③

In accordance with the Act on the Rational Use of Energy, we have set a goal of reducing energy consumption intensity and CO2 emission intensity of the entire portfolio by 1% per year on average over the next five years or by 5% over the five years from fiscal year 2016.
At SRA’s Sustainability Promotion Conference, budget and performance management (ascertaining the degree of achievement against the actual value target, comparing and analyzing with the previous fiscal year) is performed, generally on a quarterly basis. Furthermore, we have identified issues for each property and made improvements by referring to results of CO2 reduction potential and energy-saving diagnoses made by a third-party organization.

Note: Calculated based on Japanese fiscal year which starts from April 1 and ends on March 31.

FY2016
(Base Year)
FY2017 FY2018 FY2019 FY2020 Rate of change
(cf.2016)
Energy Consumption Total (MJ) 467,828,166 467,719,396 460,970,411 457,258,994 424,633,654 -9.2%
Intensity (MJ/㎡) 1,520 1,422 1,252 1,176 1,045 -31.2%
CO2 Emission Total (tCO2) 23,292 22,483 23,302 22,052 19,403 -16.7%
Intensity (tCO2/㎡) 75 68 63 57 47 -36.8%
Water Consumption Total (㎥) 244,964 254,822 270,526 305,605 239,361 -2.3%
Intensity (㎥/㎡) 0.82 0.78 0.72 0.77 0.59 -28.0%
Amount of Waste Amount of Non-hazardous Waste 2,519 2,863 2,995 2,664 2,072 -
Amount of Incineration (t) 1,035 1,348 1,404 1,130 941 -
Recycling Quantity (t) 1,422 1,514 1,591 1,534 1,130 -
Recycling Rate 56.4% 52.9% 53.1% 57.6% 54.6% -
energy_graph
co2_graph
water_graph
waste_graph

2. Environmental Considerations by Engineering Management

2-1. Reducing Energy Consumption

■ 2-1-1. Introduction of LED

Sustainability Policy ①・②

led_before led_after

Utilizing the government’s subsidy program, NIPPON REIT is actively promoting the introduction of LED lighting to reduce energy consumption. The energy consumption of the underlying properties is reduced, and a brighter and more comfortable environment is provided by converting lighting fixtures in common areas and leased areas, and emergency lighting fixtures (guide lights and emergency lights) to LEDs.

LED Lighting Conversion 18 Properties
19.4% of Gross Floor Area

■ 2-1-2. Switching to Renewable Energy-Derived Electricity

Sustainability Policy ①

Pigeon Building

Pigeon Building

100% of the 407,974kWh expected electricity-use per year is covered by renewable energy generated by biomass power generation (FIT). This will provide expected CO2 reduction effect of 193t per year.

La Verite AKASAKA

La Verite AKASAKA

100% of the 205,763kWh electricity used per year is covered by renewable energy generated by hydroelectric power generation. This will provide expected CO2 reduction effect of 95t per year.

FORECAST Kameido

FORECAST Kameido

100% of the 375,248kWh electricity used per year is covered by renewable energy generated by biomass power generation, (FIT) This will provide expected CO2 reduction effect of 177t per year.

Note: The calculation period of each property differs based on the timing renewable energy was introduced. Please note that for Pigeon Building, a reference amount is indicated as the expected electricity-use per year.

2-2. Water Conservation

■ 2-2-1. Installment of Water Saving Device (Example: FORECAST Gotanda WEST)

Sustainability Policy ①

Water-saving equipment for toilet has been introduced in several properties held by NIPPON REIT as a part of the initiatives for saving water. In addition to its water-saving effect, this equipment contributes to the reduction of electric power for the water pumps and CO2 emissions.

Before After Reduction rate
18.0ℓ/toilet flush 9.2ℓ/toilet flush 48%

Note: The table above indicates the average amount of water used per toilet flush before and after the installation of the water-saving equipment.

3. Stakeholder Engagement to Improve Property Performance

3-1. Green Lease

Sustainability Policy ①・⑤

Green lease agreements are concluded with tenants to ensure mutual cooperation between individual building owners and tenants in promoting environmental measures.

What is Green Lease Agreement?

It is an agreement specifying that building owners
and tenants shall cooperate with each other to
reduce environmental burden.
The agreement contains provisions to facilitate
renovation toward more environmentally-friendly
office buildings by reducing building owners'
investment burden through sharing the economic
merits generated as a result of energy-saving
renovation works among building owners and tenants.

greenlease

3-2. Tenants and Stakeholder Engagement to Improve Property Performance

Sustainability Policy ①・⑤

  1. NIPPON REIT prepared letters to tenants requesting reduced energy consumption, distributed manuals for office users and put posters on each floor to raise awareness about energy efficiency.
  2. The property management company receives ESG - related training for the purpose of promoting increased awareness of environmental consideration in daily operations.
  3. For electronic toilets, the temperature settings for the heater and water for cleansing are controlled and adjusted for each season.
  4. Electric water heaters in staff kitchens are managed and their temperature settings are adjusted for each season.
  5. The temperature settings and hours of operation of air conditioning and lighting for common use space are adjusted by means such as timer control, Environmental Management Systems (EMSs) and human presence sensors for lighting.
The poster of "In the power saving"
In the power saving

4. Environmental Pollution Prevention

Sustainability Policy ③

Prior to finalizing an agreement to purchase real estate, a due diligence is always conducted by an expert to verify legal compliance. NIPPON REIT also conducts a due diligence in advance to check for the presence of soil contamination or specified hazardous substances, such as asbestos, to identify and avoid properties that are a risk in terms of their impact on the natural environment.

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