Columbia Threadneedle: Green to gold - realising opportunities from the carbon transition

At Columbia Threadneedle Investments we have long been vocal in our view that decarbonisation presents a positive opportunity to align environmental and financial outcomes. Incorporating green energy infrastructure into the development and refurbishment of our assets reflects the tactical implementation of that strategic conviction.

Future-proofing assets to align with occupiers’ green ambitions demonstrates good stewardship and offers significant potential to add value to existing land and buildings. Through the delivery of green energy to occupiers and wider communities we are able to generate additional revenues for investors.

The two principle drivers of value are power generation, primarily derived from rooftop solar photovoltaic (PV) panel installations, and power provision, typically through electric vehicle (EV) charging. Revenues can also be derived through power storage (batteries), leveraging the arbitrage in the electricity price differential at various points in the day, although this is less tested and typically attracts higher capital costs.

Additionally, we see opportunity through traditional refurbishment and development initiatives to deliver an enhanced specification to the occupational markets, and benefit from greater rental growth.

"Incorporating renewable energy at scale has the potential to improve energy resilience for occupiers, to the extent that some assets can be operationally net carbon negative. The scarcity of these assets ensures appeal to a wide range of occupiers and investors"

James Coke, Fund Manager & Co-head of Institutional UK Real Estate