A New Trinity for Measuring Data Centre Sustainability (Cushman & Wakefield)
The Asia Pacific data centre market is one of the fastest developing regions and is on track to become the world’s largest over the next decade. Explosive growth in data centre demand across the region, however, has deepened the sector’s environmental impact.
Leaders in the data centre industry have responded by becoming powerful voices for sustainable change and as per a recent webinar on Data Centres in Australia Driving the Sustainability Agenda, they are interested more in collaborating than competing and agree that newer standards and gauges can unlock the next green wave of impact and value.
Data centres have traditionally relied on Power Usage Efficiency (PUE) as the sustainability metric of choice. While substantial improvements in PUE standards have been made over the years, measuring PUE alone fails to capture the full environmental impact of data centres.
In this report, we explore how PUE, in combination with Water Usage Efficiency (WUE) and Carbon Usage Effectiveness (CUE) can form a more holistic measure of sustainability performance.
Under the Lens: India’s Data Center Explosion (ANAROCK)
The unprecedented crisis created by the COVID-19 outbreak has propelled the data center business providing an unexpected tailwind. Technology adoption and digitization across the sectors were fast-tracked globally and India also leap-frogged at least a decade in the past couple of years.
The lockdown and subsequent restrictions threw life and business out of gear. However, this very black swan event became a massive catalyst for digital adoption across the country.
The government’s initiative and drive towards a digital economy was accelerated further as all aspects of daily life from banking, education, and shopping were forced to switch and adapt to the digital ecosystem. This had led to increased use of data consumption and internet bandwidth across the country, driven by the ever-expanding reach of social media, increased use of smart devices, data localization, increased adoption of cloud services, and digital transformation journeys of several Indian companies.
India accounts for 14% of the world’s mobile subscriptions and 15% of the total mobile data traffic. This is likely to increase to 17% by 2027 as our economy is poised to grow despite a global slowdown and other economic headwinds. Hence, it is evident that a substantial volume of data will be generated that will require enhanced storage capacity.
While the presence of data centers is primarily in the major metropolitan locations as of now, soon tier II & III cities will emerge and offer quality supply for this new-age asset class. As manufacturing and warehousing spread out across the country to deliver and service demand from the non-metro market, data centers in the future are more likely to make their way to such locations.
Our survey of IT-ITeS professionals across the country reveals that improvement in operational efficiency is the topmost priority. The specialized operators in this domain are likely to rule the market as most companies are comfortable paying a premium for the efficiency in services and eased operations.
Our latest publication on the preparedness for the future of data centers reveals many more interesting and lesser-known details on this sunshine sector.
AEW published a research report on climate risk. The report, authored by Hans Vrensen, Head of Research & Strategy, explores how physical climate change, in particular river floods and rising sea levels, will impact European real estate returns, and the importance of a proactive investment approach.
Tech Cities: The Global Intersection of Talent and Real Estate (Cushman & Wakefield)
With a significant growth forecast for the global tech sector in the next 10 years, the evolution of tech cities around the world as hubs of tech talent and suitable commercial real estate will continue. In this report we assess how tech cities are competing for business across key talent, real estate, and business environment metrics.
Key Takeaways
46 top tech markets were identified based on 14 criteria, across Talent, Real Estate, and Business Environment metrics.
Talent is a critical factor for tech companies when determining location, with the tight labor market increasing competition for the right talent.
Hybrid work and historical inflation are major considerations when making Real Estate decisions.
National and local business environments will continue to play a strong role in tech companies’ location selection.
Monetary Authority of Singapore (MAS) Sustainability Report 2021/2022
This report sets out MAS’ strategy on climate resilience and environmental sustainability to strengthen the resilience of Singapore’s financial sector to environmental risks, develop a vibrant green finance ecosystem, build a climate-resilient reserves portfolio, and incorporate sustainable practices.
Climate Reporting in ASEAN: State of Corporate Practices
Landmark research from Global Reporting Initiative (GRI) and the National University of Singapore (NUS) Business School has, for the first time, shed light on how companies in the ASEAN region are addressing their obligations for climate-related reporting.
Analysis of the top 100 largest listed companies in six Southeast Asian nations – Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam – finds 70% (420 companies) published climate-related disclosures in 2020/2021. Climate Reporting in ASEAN: State of Corporate Practices analyzes those 420 businesses, focusing on their approach to reporting, materiality, risks and opportunities, governance, strategy, targets, and performance.
Key findings of the research include:
Most of the companies (84%) report their material topics on climate change, yet only one quarter (26%) describe long-term factors related to their climate risk strategy;
62% of companies disclose their greenhouse gas emissions (ranging from 5% in Vietnam to 80% in the Philippines);
A majority of businesses (56%) identify climate-related opportunities, compared with less than half (47%) sharing plans on risk mitigation;
Three-in-four companies (74%) disclose metrics on climate-related performance, however, 46% do not share how targets are discussed;
Two-third (68%) assign climate responsibilities to a sub-committee, while 8% link management remuneration to climate
In terms of climate reporting:
A significant majority of sampled companies (85%) use the GRI Standards, ranging from Singapore (99%) to Vietnam (65%);
In the six markets, reporting using other frameworks is low: 19% use TCFD, 16% apply IIRC, and 14% use SASB;
At 76%, reporting on the Sustainable Development Goals is widespread by the companies in all six countries, with those from Thailand (95%) and Indonesia (93%) leading the way.
Tackling Scope 3 emissions: The opportunities and challenges for service businesses (Cushman & Wakefield)
By Alton Wong, Executive Director, Co-head of Sustainability Services, Greater China, Cushman & Wakefield
For businesses in carbon-intensive industries, the challenge of reducing Scope 1 emissions (direct emissions from owned or controlled sources) can be great.
For service-based organizations, Scope 1 emissions may represent only a single-digit percentage of their entire carbon output. In these cases, the majority of their emissions are Scope 3 – they originate further up or down their supply chain through the activities of their suppliers.
So how do service businesses, like financial institutions and consultancies, reduce what they cannot control?
The data challenge
Any carbon reduction journey begins with reporting: you cannot manage what you cannot measure. While we have seen an increase in queries on ISO14064 – the international standard for reporting greenhouse gas emissions – reporting requires data, and capturing reliable data is the greatest challenge we see across the region.
In many cases, the data needed even to establish a baseline year – the year to which emissions will be compared – is not captured. While most, but not all, companies have utility data, few capture emissions for business travel or employee transport. This problem is compounded when tackling Scope 3 emissions.
Collaboration is the only way forward
As a service organization ourselves, Cushman & Wakefield’s Scope 3 emissions account for greater than 98 percent of our total emissions. That is why a key pillar of our net zero commitment is to engage our clients in their own carbon reduction journeys.
For businesses like ours, achieving a net zero commitment – which includes Scopes 1, 2 and 3 – is dependent on our supply chain doing the same. The good news is that it is a two-way street: by reducing our own direct emissions (by implementing energy efficiencies such as updated HVAC and LED lighting, for example) we are also bringing down the Scope 3 emissions of our clients. Similarly, when our clients implement energy efficiencies (their Scope 1), they reduce our Scope 3.
As more companies set net-zero targets, it is increasingly apparent that we are all in this together. At Cushman & Wakefield we have our own data challenges to overcome – especially around Scope 3 emissions. Like all companies, we are working hard to constantly improve, and to share our learnings with others, because we know that we will not reach net zero alone.
Alton Wong, MRICS
Executive Director, Head of Advisory Services, Valuation & Advisory Services, Greater China Co-head of Sustainability Services Cushman & Wakefield
Alton Wong, MRICS
Executive Director, Head of Advisory Services, Valuation & Advisory Services, Greater China Co-head of Sustainability Services Cushman & Wakefield
Alton is the Executive Director and Head of Advisory Services in the Valuation & Advisory Department, Greater China as well as Co-head of Sustainability Services, with over 16 years of experience in valuation and advisory services, particularly for due diligence, auditing, public document and financing purposes in Hong Kong, Mainland China and other Asia Pacific countries.
Leading the Greater China Advisory Services team, Alton provides valuation, feasibility and market study, market positioning, performance assessment, development advisory services etc., which covering different areas of alternative investments, including senior housing, logistics property, data centre and life science park.
He also has extensive experience in environmental, social and governance (ESG) advisory services, covering ESG ratings, Global Real Estate Sustainability Benchmark (GRESB), Task Force on Climate-related Financial Disclosures (TCFD), energy solutions, sustainable development, green/ wellbeing building certifications services etc. He is also our committee member of C&W’s Global Corporate Social Responsibility team.
Alton is also one of the drafting members of the HKIS Valuation Standards 2017 and 2020 editions.
An increasing number of institutions, especially financial institutions, have started to disclose climate-related risks and opportunities in alignment with the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD).
MSCI ESG Research LLC data and metrics can be used at the portfolio, sector and security level to support reporting on the four pillars of the TCFD recommendations: governance, strategy, risk management and metrics and targets.
Asia Pacific ViewPoint – Landlords and Tenants Must Collaborate to Achieve Sustainability (CBRE)
With the pandemic now well into its third year, most office occupiers in Asia Pacific are displaying a clear shift towards embracing real estate strategies that recognise that COVID-19 is here to stay for the long-term.
Among these approaches are a sharper focus on wellness and sustainability in the workplace, with CBRE Asia Pacific’s 2022 Spring Office Occupier Survey finding that most tenants are implementing or at the very least considering a range of related initiatives.
This ViewPoint by CBRE Research expands upon the survey findings and identifies the main challenges and priorities facing landlords and investors as they look to respond to growing occupier demand for green buildings, leases and technologies.
Climate Positive, Proof Positive: Approaches and Rating and Benchmarking Systems for Sustainable Real Estate (Cushman & Wakefield Greater China)
Cushman & Wakefield Greater China’s report begins by considering and explaining what climate positive is and means. Secondly, the report looks at a number of selected climate-positive approaches for sustainable real estate. Thirdly, the report examines two proven rating and benchmarking systems that can go some way to help enterprises achieve their climate positive goals, and they are:
At the enterprise level – The Task Force on ClimateRelated Financial Disclosures (TCFD), and;
At the real estate level – The Global Real Estate Sustainability Benchmark (GRESB).
Kemmu Kawai joined Longevity Partners Japan in September 2022 as the Country Director. Based in Tokyo, he oversees all operations and activities in Japan, the Asia-Pacific region and beyond. He brings him more than 16 years of experience in finance where he specialised in real estate and credit investments. Before joining Longevity Partners, he served as a Portfolio Manager at Norinchukin Bank and as Investment Manager at Center Point Development.
