Environmental

Vesteda constantly aims to improve it’s 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 stimulate a circular approach in the use of 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 sustainability standards.

Portfolio sustainability improvements

Vesteda’s participants approved a plan in 2015 to improve the energy performance of the portfolio.

In 2024, we invested €34 million and improved the energy performance of 2,018 residential units. The measures included the installation of high-efficiency boilers, DC ventilators, LED lightning in common areas, insulated glass, the insulation of roofs, cavity walls and under floors, and the installation of solar panels. Vesteda installed a total of 13,935 solar panels last year. At year-end 2024, Vesteda had a total of 47,613 solar panels in its portfolio, generating approximately 12.5 million kWh annually.

The percentage of homes in our portfolio with a green energy label (A, B, or C) increased to 98% in 2024, from 96% the previous year. The percentage of A labels increased to 58% in 2024 from 50% in 2023, due to the renewal of energy labels of existing homes and new acquisitions. The main deviation from the 99% target is the delay of one renovation asset. Going forward, Vesteda will report on actual energy performance.

Energy labels (%, weight in units)

Healthy and safe homes

We want to provide our tenants with healthy and safe homes. This means that central heating boilers are checked regularly, lifts are checked frequently and combined heat and power installations are provided with new filters whenever necessary. We also strive to have homes without high-risk asbestos. The quality of drinking water in our complexes is also essential. 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 were monitored or executed by our Operations department:

• Legionella: Up until 2024, approximately 80% of our multi-family complexes were 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: An external partner inspects our homes if the presence of asbestos is suspected, for example based on the year of construction or other information. If asbestos is found, Vesteda takes appropriate action, including clean-ups and providing information for tenants and third parties.

• Central heating installations: Over the course of two years, nearly 80% of all our central heating systems were inspected.

• Combined heat and power installations: In 2024, we inspected more than 60% of the combined heat and power installations in our complexes. The remaining installations will be inspected before the end of 2025.

• Lifts: Nearly all lifts were inspected in 2024, and 92% were approved. We will inspect the remaining lifts in 2025. In addition, we conducted separate inspection and tests on the emergency audio connections of all lifts.

• Fire safety: We inspected almost all our multi-family complexes in accordance with the Dutch building decree. In addition, in 2024 we inspected the fire extinguishing equipment, water pipes and emergency lighting at a total of 179 complexes.

Sustainable supply chain

Since 2016, we have asked 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.

Circular portfolio investments

We encourage and apply the use of circular materials in our new-build construction projects, as well as in renovation and maintenance projects. By conducting research into circularity, we aim to measurably increase our impact, as well as that of other stakeholders.

Physical climate risks

Due to the changing climate, the real estate sector and its residents are faced with physical climate risks such as heat stress and flooding. In 2021, in collaboration with Climate Adaptation Services and Sweco, Vesteda created an internal risk monitoring tool to gain insight into the physical climate risks within our portfolio. The uniqueness of the tool lies in the integration of both environmental risks and building-specific characteristics. We use this tool to monitor the physical climate risks for Vesteda’s residential portfolio, and this provides valuable information and potential measures to reduce the risks.

Climate risks and impact on Vesteda’s portfolio 2024

The previous graph shows that the risks to our total portfolio are low. We continue to address all elevated climate risks in our portfolio for assets that align with our long-term strategic objectives. In 2024, we addressed almost all high climate risks, ensuring mitigation to normal levels. For one complex we did not meet the policy requirements regarding flooding caused by heavy rainfall. We are currently awaiting an external expert opinion to take appropriate mitigation measures. By 2025, we will have planned measures to mitigate heat stress and flooding due to heavy rainfall at asset level. We address all other elevated climate risks in a mitigation plan per asset.

Climate risk: heat stress

Climate risk: flooding due to heavy rainfall

Measuring and managing resource consumption

Our goal is to manage and reduce the usage of resources (energy, water) to minimise the production of greenhouse gases in our portfolio. We measure the energy consumption of our common areas as well as from our tenants, in collaboration with energy suppliers and grid operators. Please refer to Annex 4 for all energy consumption data according to INREV guidelines. For 2024, the heating consumption has not been received; therefore, the coverage is 0%.

The reporting on managing and reducing resource consumption is according to the INREV GRI reporting standard. The overview showcases an overall increase of 1.2% (measured in kWh). The overall increase is due to the increased gas consumption in tenant spaces.

Common areas

In 2024, with regards to the common areas, our electricity consumption decreased by 3.6%, and gas consumption by 13.3%. The reduction results from our efforts and investments in improving the sustainability of the portfolio. Since not all utility providers have finalised their annual statements yet, the coverage in 2024 is lower than in 2023.

In a like-for-like comparison, consumption is evaluated for areas where data is available for twelve months in both 2023 and 2024. The square meters of common areas are calculated based on a representative sample, indicating that the actual common area square meters, on average, represent approximately 14% of a building.

Tenants

In 2024, tenant electricity consumption decreased by 3.6%, while gas consumption increased by 4.4%. The like-for-like comparison is conducted for areas where data is available for twelve months in both 2023 and 2024. Despite our continued sustainability efforts, gas consumption for tenants increased.

Besides the decrease in electricity consumption, there is also an increase in the generation of solar energy. This helps in lowering greenhouse gas emissions and decreasing expenses for our tenants, which improves affordability.

Paris Agreement

As part of our focus on climate change mitigation, we have a 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 the kWh/sqm consumption and CO₂/sqm emissions of our portfolio. Using the 'Trias Energetica principle', we will first focus on reducing the energy demand of our homes.

CO₂ Roadmap

Our target is to reduce our energy consumption by 60% in 2030, compared with 1990. To achieve this goal, we accelerated our sustainability investments, including investments in climate adaptivity. The roadmap is dynamic, since policies and targets are subject to change. We are well on our way to achieving our 2030 target, having reduced our CO₂ emissions by over 50% compared with 1990.

After 2030, we will continue to focus on further reducing energy consumption and on switching to sustainable 'green' energy sources to realise a 95% reduction in CO₂ emissions by 2045. Our goal is to ensure that the remaining energy consumption consists of CO₂ emission-free energy.

CO₂ footprint of our organisation

Vesteda aims to continuously reduce the CO₂ emissions of our organisation. In 2024, the total CO₂ footprint of our organisation was 297 tonnes of CO₂, or 1,338 kg per FTE. This includes ten regional offices. Our 2024 carbon footprint decreased by 21.7% per FTE compared with the previous year.

Based on the GHG protocol, scope 1 continues to account for the majority (67%) of our total emissions, compared with 1% for scope 2 and 32% for scope 3.

CO₂ emission per FTE

The reduction in our CO₂ footprint is largely due to the further electrification of our vehicle fleet and additionally, the relatively mild winter in 2024 likely contributed to lower heating-related emissions.

Mobility remains the largest contributor to our CO₂ footprint. However, Vesteda continued to reduce these emissions by increasing the share of fully electric vehicles in our fleet. By the end of 2024, 80% of our fleet was fully electric, compared to 66% at the end of 2023. The total CO₂ emissions from mobility decreased by 25.6% compared to 2023, demonstrating our commitment to sustainable travel and operations.

Transport-related CO₂ emissions per FTE

Circularity within our organisation

In 2024, several steps were taken to advance circularity and sustainability within the organisation. The procurement policy was reviewed, leading to initiatives that will take place in 2025, aimed at enhancing circular procurement practices.

Efforts were also made to improve waste management by exploring alternative collection services for better data and transparency.

Vesteda remains committed to circularity and sustainability, continuously looking for ways to improve resource efficiency and reduce environmental impact across all aspects of our organisation.

EU Taxonomy

The Taxonomy Regulation establishes the framework for the EU Taxonomy by setting out four conditions that an economic activity must meet in order to qualify as environmentally sustainable.

A qualifying activity must:

• Contribute substantially to one or more of six environmental objectives, being:

• • Climate change mitigation

  • Climate change adaptation

  • Sustainable use and protection of water and marine resources

  • Transition to a circular economy

  • Pollution prevention and control

  • Protection and restoration of biodiversity and ecosystems

• Do no significant harm to any of the other environmental objectives.

• Be carried out in compliance with minimum (social) safeguards.

• Comply with technical screening criteria.

The technical screening criteria specify the performance requirements for any economic activity that determine under what conditions that activity makes a substantial contribution to a given environmental objective and does not significantly harm the other objectives. For the financial year 2024, all six objectives listed above have been laid out in more detail and are applicable for reporting.

The fund’s eligible activities contribute to climate change mitigation and fall under category 7.7 ‘Acquisition and ownership of buildings’, as set out in Annex I to the Delegated Regulation (EU) 2021/2139^[1].

The fund’s Taxonomy alignment is set out in the SFDR Disclosure document (Annex 3) and is reported in terms of the market value of the fund’s real estate assets.

Sustainable Development Goals (SDGs)

Vesteda embraces the UN’s Sustainable Development Goals, which define global sustainable development priorities and aspirations for 2030. This common set of 17 goals and 169 sub-targets calls for worldwide action from governments, business and civil society to end poverty, ensure prosperity for all, and protect the planet. We consider the following SDGs the most relevant to our activities, based on what we do and our ambitions: Affordable and clean energy (7), Sustainable cities and communities (11), Responsible consumption and production (12) and Climate action (13). The following figure shows our SDG actions mapped along our value chain.

Our value chain and SDG actions

Global Reporting Initiative (GRI)

Vesteda reports on the basis of GRI Universal Standards. For more information, please see the About this report section and Annex 2 of this report.

GRESB

The Global Real Estate Sustainability Benchmark (GRESB) provides a tool to compare the sustainability of real estate investment funds. The GRESB survey is designed to identify the sustainability performance of the real estate sector and is now a widely recognised and well-respected initiative. The environmental benchmark rates environmental management practices and their implementation, making it possible to compare different real estate investments on a national and international level. Vesteda believes that GRESB is helping to increase transparency with respect to the sustainability of real estate funds. To contribute to the continued evolution of the benchmark, Vesteda joined GRESB as a member in 2013.

In 2024, Vesteda was again awarded five out of five stars and climbed to the top position in the reference group in the Netherlands and the world, which resulted in Vesteda being named the GRESB Global Sector Leader Residential. The five-star rating is the highest attainable rating in the annual GRESB benchmark survey, representing the 20% best scoring participating funds worldwide. Vesteda is committed to remaining a top player in the field of sustainability at a national and international level.

ESG breakdown GRESB 2024

GRESB score 2024

UN PRI

The Principles for Responsible Investment (UNPRI or PRI) is a United Nations-supported international network of financial institutions. Its goal is to understand the implications of sustainability for investors and support signatories to facilitate the incorporation of these issues in their investment decision-making and ownership practices. 

Vesteda achieved five-star ratings across all three applicable modules: 93% in Policy Governance and Strategy, 98% in Direct – Real Estate, and a perfect 100% in Confidence Building Measures. We are committed to maintaining these high standards and continuously improving where possible.

UN PRI summary score card

Accelerating our path to sustainability

We will continue to implement our CO₂ Roadmap and strive to realise our ambitions to become Paris Proof by 2045 instead of 2050. Our goal for 2030 is to realise a 60% energy reduction in kWh/sqm compared with 1990. We will continue with the large-scale renovations of our residential complexes to reduce energy demand of our homes and total cost of living for our tenants. Furthermore, we are actively increasing awareness and motivation among our tenants to reduce energy use. We are investing in new climate-proof buildings and we are taking measures to lower the physical climate risks of (very) high-risk assets. Finally, we are implementing the sustainability impact score of our new acquisitions and standing assets.

• 1 Commission Delegated Regulation (EU) 2021/2139 of 4 June 2021 supplementing Regulation (EU) 2020/852 of the European Parliament and of the Council by establishing the technical screening criteria for determining the conditions under which an economic activity qualifies as contributing substantially to climate change mitigation or climate change adaptation and for determining whether that economic activity causes no significant harm to any of the other environmental objectives (Text with EEA relevance)