Further development of Climate Risk Monitor leads to more insight into climate risks

In 2021, we developed a tool called the Climate Risk Monitor which could identify the climate risks for real estate based on data from the KNMI Climate Effect Atlas and Climate Adaption Services (CAS). This tool has since been further developed and professionalised, based partly on the recent ‘Framework for climate adaptive buildings’ of the Dutch Green Building Council (DGBC). ‘Thanks to the contribution of the DGBC we can make an even more accurate environmental scan and soon an optimised building scan. Using these, we will know down to the level of individual building and plot of land exactly the scale of the various climate risks,’ says Marco van der Spank, a researcher who is involved within a.s.r. real estate in the ‘Climate Risk Monitor project’.

The current improved tool divides climate risks into four distinct themes: heat, drought, flooding and extreme precipitation. Then it gives a score for each climate risk theme to every building and plot in the real estate portfolios of a.s.r. real estate. The higher the score, the greater the climate risk. According to Van der Spank: ‘Heat stress, for example, is largely experienced in densely built-up areas. In cities, people are more likely to suffer from it during a heat wave, because the heat stays longer. Heat stress is more of an issue in buildings such as offices or apartment complexes where people are present for long periods of time, than in shopping centres, for example, where most users are only there temporarily. Using data from the Climate Effect Atlas, we can see where heat stress might have the greatest impact. We can also use this data to come up with measures to increase climate adaptation. For example, you can counter heat stress by greening gardens and roofs – something that we are already actively working on within the ASR Dutch Core Residential Fund . This also increases biodiversity.’

Interactive maps

According to Van der Spank, you can only guarantee long-term returns when objects are attractive to users and society. ‘Our focus is on the sustainable value development of real estate. That is how we can contribute to a liveable society for current and future generations. We can achieve this by reducing CO2 emissions, accelerating the energy transition and making our portfolios Paris Proof and climate adaptive. With the Climate Risk Monitor, we have set up a dashboard through a Geographical Information System (GIS) which combines the climate maps of the Climate Effect Atlas with the geo-data of our property portfolios in order to get the necessary data on the various climate risks. These are then plotted on interactive maps and these ‘risk maps’ give us an idea of the risks for our existing real estate portfolio. Because we can perform this risk analysis on any plot of land in the Netherlands, we can also see any climate risks that might be associated with possible new acquisitions. We are currently also working on an online application, a kind of climate app, with which our acquisitors and asset managers can see the most up-to-date climate risk data and include it in their investment advice. Because of the consequences of climate change, climate-adaptive buildings are essential.’

Tackling the consequences of climate change is a team effort

Testing for climate risks has become ever more important. Van der Spank: ‘The development of our Climate Risk Monitor has been partly dictated by legislation and regulations. Under the Sustainable Finance Disclosure Regulation (SFDR), part of the EU’s Action Plan for Financing Sustainable Growth, the financial sector has an obligation to provide information about sustainability. But even without this legislation, we would have actively started mapping climate risks. We have also worked as closely as possible with widely supported developments. As previously mentioned, DGBC is working in a broad alliance of financial institutions, knowledge institutes, advisors and governments on the ‘Framework for climate adaptive buildings’. This includes a straightforward methodology for determining physical climate risks at the level of the individual building. This optimised building scan will be implemented in the Climate Risk Monitor next spring and tested continuously. We at a.s.r. real estate applaud these widely supported initiatives and objectives. After all, tackling the consequences of climate change is primarily a collaboration between the various parties involved, including municipalities and water boards. That is why we continue to actively seek cooperation in order to keep responding to all of these developments.’