Socially Responsible Real Estate. Who Knew?

Get with the Program... "A movement to encourage 'socially responsible' investment is taking baby steps into real estate." ... Hmm. What the heck is socially responsible real estate? ("Real Estate's Latest Movement," Wall Street Journal, Jul 5, 2006)

Well, it turns out that Prupim (Prudential Property Investment Managers) recently hosted a two-day meeting in London to find "ways to determine how institutional investors can be more environmentally responsible in the way they run their building portfolios." Did any PikeNet reader attend?

This could be a big deal. "If socially responsible [U.S.] investors allocated just 10% of their money toward real-estate companies, they would own two-thirds of the total capitalization of U.S. REITs..." That's the estimate of Gary Pivo, a University of Arizona professor. "But since there are no standards in place, [Pivo] adds, these investors 'are unsure of who deserves their support.'"

In the meantime, according to the Wall Street Journal, some U.S. institutional investors are already taking the initiative. CalPERS (California Public Employees' Retirement System) "recently established goals to reduce energy usage by 20% over the next five years in the $5 billion worth of buildings that it owns."

And Thomas Properties Group "is shopping for investors for a $500 million real-estate fund to buy or develop properties that have met the standards of the U.S. Green Building Council's program called Leadership in Energy and Environmental Design, or LEED."

Are your investors and tenants seeking "socially responsible" real estate?

-- Peter Pike