Sustainability Policy / Sustainability Promotion System Message from Senior Management

Message from Senior Management

Introduction

We would like to take this opportunity to thank you for your exceptional support of Sekisui House Reit, Inc. (SHR)

In recent years, all aspects in the business environment surrounding the company have undergone dramatic changes. In such an environment where uncertainty is increasing, in order for SHR to aim for stable, medium to long term growth, it is essential that we engage in efforts to realize a sustainable society that will be the foundation for this growth.

What SHR is Aiming for

SHR has set a vision of “managing assets to better provide for people, society and the future”. This is a declaration of our determination to continue contributing to the creation of a more prosperous “future” by seeking to enhance the value of our assets under management together with our sponsor Sekisui House, and by providing social capital for a new era for the “people” and the “society”. We believe that addressing social issues through asset management that takes ESG (Environmental, Social and Governance) into consideration will contribute to the realization of a sustainable society and enhance the trust of stakeholders, thereby contributing to securing stable earnings over the medium to long term and maximizing unitholder value.

Recent Initiatives

Based on this idea, SHR has identified materiality (important issues), set KPIs (targets) and is actively pursuing initiatives to resolve the issues.
As a result of our efforts to reduce GHG emissions, including the introduction of renewable energy at most of our properties, we were able to achieve our initial target of reducing total Scope 1 and Scope 2 GHG emissions by 42% by 2030 compared to FY 2021 levels ahead of schedule. Therefore, in 2024, we have revised our reduction target upwards, setting a target of reducing emissions by a further 42% from the base year of 2023 accelerating our efforts. We also formulated a roadmap for reducing GHG emissions and will aim to achieve net zero by 2050.
In addition, we have identified "investing in real estate with excellent environmental performance" as one of our materialities and added ZEH (net zero energy house) properties developed by Sekisui House to our portfolio for the first time. As an immediate goal, we will aim to acquire 10 ZEH properties. The percentage of properties with green certification was 82.9% as of the end of October 2024.
In terms of governance, we have increased the number of supervisory directors on the Board of Directors of SHR by one since February 2024, and simultaneously, the ratio of female directors rose to 50%, further strengthening our governance structure.
Upon the materiality of “creating a rewarding workplace”, Sekisui House Asset Management, Ltd. is also taking various initiatives and have made significant revisions to our personnel system, such as incorporating elements linked to the price of SHR’s investment units into performance bonuses, in the hopes of further increasing employee motivation.
These ESG initiatives have been highly evaluated by external evaluations, and we were able to obtain a "4 Stars" rating in the 2024 GRESB Real Estate Assessment (Note 1), one rank higher than the previous year. Furthermore, we have acquired "AA" rating by MSCI ESG ratings, and in the 2023 CDP Climate Change Program (Note 2), we obtained a score of "A-" (the second highest score) in our first participation.
Going forward, we will continue to review our materiality and targets (KPIs) in response to changes in the environment, society, economy, and other factors, and focus on improving the sustainability of both society and SHR.

Toward the Realization of a Sustainable Society

SHR has acquired two urban rental housing (multi-family) properties in the U.S. for the first time, and has also been disposing office buildings in Japan, making a major shift in its policy to build a portfolio centered on residential properties. By incorporating both ‘stable growth’ in Japan and ‘active growth’ in the U.S., we will continue to strive to maximize unitholder value through the provision of high-quality real estate, that will become the social capital of a new era. As a REIT that leads the way in the era of the 100-year lifespan, we aim to continuously meet the expectations of our stakeholders and contribute to the creation of a prosperous future, while aiming to be a widely loved REIT for a long time to come.

We would like to ask the continued support and encouragement of our stakeholders in the years ahead.

  • GRESB Real Estate Assessment is an annual benchmark to evaluate ESG considerations in the real estate sector.
  • CDP Climate Change Program is a program for companies and cities to disclose information on climate change risks, and CDP is an organization that scores the level of environmental measures taken by companies and cities.

Sekisui House Reit, Inc.
Atsuhiro Kida
Executive Director (Right)

Sekisui House Asset Management, Ltd.
Toru Abe
President & Chief Executive Officer (Left)

役員写真