ENVIRONMENTAL Green Capital Expenditure In 2023, CLI conducted and provided to senior management a portfolio review on the required capital expenditure (capex) for its global portfolio, including CLAS, to meet the SMP environmental targets for carbon emissions, on-site renewable energy, energy efficiency, water efficiency and green certification. The goal of this review was to ensure that an appropriate amount of capex for relevant environmental initiatives and technologies was set aside in the annual budget. Time bands were included in the review to map out the phased implementation of the capex plans, and to provide management with insights on the medium-term capex requirements. The outcomes of the portfolio review were further combined with climate scenario analysis data. This allowed CLI and CLAS to better manage the transition risks of each individual property, generate further insights on the properties’ environmental performance, and customise property-specific strategies. Green Building Rating and Certification Green building ratings and certifications help to affirm the quality of CLAS’ properties. These ratings serve as an external validation that CLAS has considered these key environmental aspects in its project design, development and operations. Green-rated properties are also more resource-efficient to construct and operate, which aids in resource management. For properties in Singapore, the Building and Construction Authority (BCA) administers the Green Mark Certification. For properties outside of Singapore, the green rating certification is administered by government ministries and agencies, as well as accredited certification bodies including the World Bank Group’s International Finance Corporation (IFC) and Green Building Councils which are part of a global network recognised by the World Green Building Council. In 2018, Ascott signed an Memorandum of Understanding with IFC to pioneer a green certification for the serviced residence industry, as part of the IFC’s Excellence in Design for Greater Efficiencies (EDGE) programme. For development and redevelopment projects, green building rating targets are determined at the outset and the properties are designed and constructed to meet green certification standards. In June 2023, CLAS completed the development of Standard at Columbia, a freehold student accommodation property in South Carolina, USA which was designed to meet green certification standards. Shortly after, the property received the National Green Building Standard certificate. CLAS’ ongoing urban redevelopment project, Somerset Liang Court Property Singapore, is similarly designed to meet green certification standards. The development is expected to complete in 2026. Green certification of rental housing and student accommodation properties is relatively uncommon in the lodging sector. In 2022, CLAS embarked on and completed a market study to identify green certification typologies for these niche real estate asset classes, so as to green its rental housing and student accommodation properties. In 2023, CLAS achieved its first green certification for a rental housing property, Alpha Square Kita 15 jo in Sapporo, Japan, and first green certification for a student accommodation property, Standard at Columbia in South Carolina, USA. Alpha Square Kita 15 jo is also the first property and rental housing property in Japan to receive the EDGE certification. CLAS targets to green 50% of its portfolio of properties by 2025, and 100% of its portfolio of properties by 2030. Excluding renewals, 22 properties were newly greencertified from January 2023 to May 2024, bringing the total number of green-certified properties to 47 as at May 2024. Approximately 51% of CLAS’ gross floor area is now green-certified, up from 37% at the end of 2022. A list of CLAS’ green-certified properties can be found in Appendix A of this report. Percentage of properties certified to a recognised sustainability standard Dec 2021 Dec 2022 Dec 2023 May 2024 2030 Target By gross floor area 33% 37% 49% 51% 100% By number of properties 22% 25% 43% 46% 100% Excludes properties under development. 27 CAPITALAND ASCOTT TRUST
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