Environmental

Vesteda constantly aims to improve our sustainability performance, which helps us safeguard the attractiveness of the fund and optimise our long-term risk/return ratio. Our objective is to reduce the consumption of energy and water, and cut CO₂ emissions. We also aim to use circular materials, increase biodiversity around our complexes and improve the climate adaptivity of our portfolio. Finally, we encourage our business partners to have the same high standards in terms of sustainability.

Portfolio sustainability improvement

In 2015, Vesteda’s participants approved a plan to improve the energy performance of Vesteda’s buildings. Our ambition for the future is to have green energy labels (A, B or C) for 99% of our portfolio by year-end 2024. It is nearly impossible to achieve 100% green labels, considering the state of city centre buildings and historical buildings, as well as local government regulations.

In 2022, we invested €19 million and improved the energy performance of 1,160 residential units. This includes 368 homes improved through large complex renovations. The measures include the installation of high efficiency boilers, DC ventilators, LED lightning in common areas, insulated glass, insulation of roofs, cavity walls and under floors, and solar panels. Vesteda installed a total of 6,224 solar panels. At year-end 2022, Vesteda had installed a total of 23,543 solar panels in its portfolio, generating approximately 6.1 million kWh annually.

The percentage of homes in our portfolio with a green energy label (A, B, or C) increased to 94% in 2022, from 93% in the previous year.

Energy labels (%, weight in units)

Note: the requirements for energy labels tightened in the past years. Labels are valid for a maximum of 10 years.

Healthy and safe homes

We want to provide our tenants with healthy and safe homes. This is just as important as a pleasant home and living environment. This means that our homes are free of high-risk asbestos, central heating boilers are checked regularly, lifts are checked frequently and combined heat and power installations are provided with new filters if necessary. The quality of gas pipelines and drinking water is also essential. In addition, Vesteda has drawn up risk maps for every residential building. Although these measures are of a more technical nature, they can have a positive impact on the lives and well-being of our tenants. To ensure the health and safety of our homes as effectively as possible, we took the following precautionary measures that are monitored or executed by our Operations department:

• Gas pipes: We are investigating the amount and the quality of steel gas pipes in our portfolio. We expect to have a complete overview by the end of 2023. The pipelines are replaced if the quality cannot be guaranteed or if there is an opportunity to make the property more energy-efficient and sustainable.

• Legionella: Approximately 80% of our multi-family complexes have been inspected for legionella risks in the central part of these buildings. If Vesteda is not the sole owner of a building, we ask the owners’ association to initiate the inspection.

• Asbestos: Almost all our complexes are inspected for asbestos, if this could be present based on construction year. If asbestos or signs of asbestos were found, Vesteda took appropriate action, including clean-ups and providing information for tenants and third parties.

• Central heating installations: We aim to inspect all central heating installations once every two years. For open combustion devices, we aim for an inspection every eighteen months. Over the course of two years, nearly 80% of the central heating systems where inspected.

• Combined heat and power installations: Our goal is to inspect the installations every two years and place new filters, if necessary. In 2022, more than half of the installations were inspected. The remaining installations will be inspected before the end of 2023.

• Lifts: Nearly all lifts were inspected in 2022, and 95% were approved. An inspection for the remaining lifts will take place in 2023. In addition, the emergency audio connection of all lifts were inspected and tested seperately.

• Fire safety: Nearly all our multi-family complexes are inspected in accordance with the Dutch building decree. In addition, in 2022 we inspected the fire extinguishing equipment, water pipes and emergency lighting at a total of 115 complexes. Furthermore, following new regulation, all our complexes where checked for smoke detectors. When a smoke detector was missing, a new one was installed.

Sustainable supply chain

Since 2016, we ask our largest suppliers to sign the IVBN sustainability declaration. Although signing is voluntary, it does give Vesteda the opportunity to start a constructive dialogue and it enables us to promote our core values and influence our suppliers. The next step will be to improve our impact, by rolling out a sustainability scan with questions on policies, targets and results. In collaboration with IVBN members, we conduct an annual survey which addresses a number of issues, covering the ESG topics. The input gives us a good understanding of sustainability in the chain. In 2022, 97% of the respondents signed the sustainability declaration.

Circular portfolio investments

Vesteda is committed to circular construction. We encourage and apply the use of circular materials in our new-build contruction projects, as well as for renovation and maintenance projects. From our position as an investor, we can make an important contribution in partnerships with our stakeholders.

Physical climate risks

Due to the changing climate, people are faced with physical climate risks such as heat stress and flooding. In 2021, together with Climate Adaptation Services and Sweco, we created an in-house tool to provide us with insights into the physical climate risks of our portfolio. The tool is unique because we combined environmental risks with building-specific characteristics. We use this tool to monitor Vesteda’s physical climate risks, providing valuable information and potential measures to mitigate the risks.

Climate risks and impact on the Vesteda portfolio

The risks to our total portfolio are low, and we will address and mitigate these effects on the few high-risk properties. We are now focusing on two types of risks: heat stress and flooding due to extreme rainfall. We will start with assets with a very high risk for these two risk types, with the aim of mitigating these risks by 2024. For assets with a high risk, we aim to have a mitigation plan by 2025. All other elevated climate risks are addressed in a mitigation plan per asset.

Climate risk: heat stress

Climate risk: flooding due to heavy rainfall

Measuring and managing resource consumption of our tenants

Our goal is to manage and reduce our use of resources (energy, water) and to reduce the production of greenhouse gases. We aim to structurally reduce the energy consumption in our investment portfolio. We started this project in 2016, when the focus was initially on common areas. Due to collaboration with grid operators it is now possible to also measure the energy consumption of our tenants.

Common areas

In 2022, our electricity use for common areas decreased with 2.2% and gas consumption with 8.0%. Our portfolios green electricity was 92%. The remaining non-sustainable energy have existing energy contracts that cannot be changed yet or are operated by residents associations where we have no influence on the type of energy purchased. Since not all utility providers have finalised their annual statements yet, the coverage in 2022 is lower than 2021.

In like-for-like, the consumption is compared for areas for which the consumption is available for twelve months in 2021 and 2022. The square metres of the common areas are calculated based on a representative sample in which we measured that the actual common area square metres on average represent approximately 14% of a complex.

Tenants

In 2022, the tenant consumption decreased with 2.7% for electricity, 7.9% for gas and 17.2% for district heating. In like-for-like the consumption is compared for areas for which the consumption is available for twelve months in 2021 and 2022. Data available for ten months or more is extrapolated and included for twelve months in the overview. The energy crisis and our continuous sustainability efforts helped in lowering the energy consumption of our tenants.

Total

The total energy consumption of our total portfolio including intensity measures was as followed.

Besides reduction in energy consumption, the generation of solar energy increased. In 2023, Vesteda will install more solar panels on single-family homes.

Intensity performance indicators

Paris Agreement

As part of our focus on climate change mitigation, we updated our CO₂ roadmap, in which we commit to the Paris Agreement by reducing our carbon footprint. In the CO₂ roadmap, we focus on two main KPIs, which are kWh/square metres and CO₂/square metres of our portfolio. Using the 'Trias Energetica principle', we will first focus on reducing the energy demand of our homes.

CO₂ Roadmap

Our energy reduction target has been revised from 50% to 55% by 2030, relative to 1990. To achieve these goals we will materially accelerate our sustainability investments, including investments in climate adaptivity. The roadmap stays dynamic, since policies and targets may change. We are well on our way to reducing our energy consumption by 55% in 2030. Our current reduction is over 50% in energy consumption and in CO₂ emissions, compared with consumption in 1990.

After 2030, we will focus on further reducing energy consumption and on switching to sustainable 'green' energy sources, in order to realise a 95% reduction in CO₂ emissions by 2050. The goal is to ensure that the energy consumption that remains is mostly CO₂ emission free.

BREEAM in-use certifications

In 2022, we fully certified our portfolio with BREEAM in-use. It was an extensive project, which was completed within one year time. This resulted in 634 certificates for 27,444 homes. This certification helps us to gain insight into the sustainability performance of our complexes. The outcome of the certifications is used to determine the improvements at asset level to lower the energy consumption and improve sustainability performance. The BREAAM in-use certification will also contribute to a higher GRESB score in 2023.

CO₂ footprint of our organisation

Vesteda aims to reduce the CO₂ emissions of our organisation. In 2022, the total CO₂ footprint of our organisation was 467 tonnes of CO₂, or 2,149 kg per FTE. This includes nine of our ten regional offices for which data is available. Our 2022 carbon footprint amounts to an increase of 1.1% per FTE compared with the previous year. Based on the GHG protocol, scope 1 accounts for the majority (69%) of our total emissions, compared with 3% for scope 2 and 28% for scope 3. 

CO₂ emission per FTE

To reduce energy usage at the head office, we now switch off the lighting in the restaurant and meeting rooms during daytime hours. We have also lowered the heating temperature by 1 degree centigrade and the heating is switched on an hour later. This intervention has had an impact on heating-related consumption in Amsterdam, although the consumption of electricity did increase as more colleagues came into our offices in 2022. Together with our suppliers, we are currently exploring opportunities to make our offices more sustainable and realise energy savings.

The CO₂ generated by mobility still accounts for the majority of our total CO₂ footprint. In 2022, we continued to reduce these emissions by making our car fleet more sustainable. As a result, 38% of our car fleet was fully electric at the end of 2022. The total CO₂ emissions of our mobility was 7.9% higher than in 2021, due to less car travel in 2021, an increase in the number of cars, and more car travel in 2022. The figure below shows the transport-related CO₂ emissions per FTE in the period 2012 through 2022.

Transport-related CO₂ emissions per FTE

Circularity within our organisation

In 2022, Vesteda drew up and actively pursued the implementation of a roadmap to improve circularity within our organisation. We also drew up a sustainable procurement policy together with a third party, to make sure that we purchase products more responsibly. We informed Vesteda employees about this to increase the awareness of the relevance of circularity. We increased the number of waste flows at Vesteda's head office. Together with our suppliers, we created a sustainable range of waste flows for sanitary, office and catering items, favouring FSC-certified products and minimising packaging waste.