From a sustainability perspective, we look at this as an existential crisis

How would you define the Hines approach to ESG?

It’s in our DNA and has been a fundamental part of our business since the foundation of the company. We aspire to be a sector leader in sustainable development and encourage our partners to do the best to collectively pioneer new approaches and technologies, maximising the environmental and social value of every building, every investment. Environmental and social best practices have always been closely aligned with Hines and everything we do – long before the ESG acronym became such an integral part of real estate parlance.

What are the biggest issues the industry faces in addressing the challenge of ESG?

Real estate is not a small business. We are not creating a single product. From retail in Dublin to offices in India and logistics in Spain, every market and every asset brings its own set of issues and challenges – whether they be physical, cultural, economic or policy and planning. We also can’t work in isolation. Major projects involve working in partnership with our investors, tenants, the local authority and wider supply chain. Our vertically integrated approach, which combines ground-up operating expertise and local market presence, certainly establishes us in the driver’s seat of major projects to develop an asset which meets the expectations and needs of all our stakeholders, and of course makes a positive contribution to its surrounding community.

How does Hines articulate its social purpose?

It starts at the very top with our owners’ genuinely philanthropic nature and commitment to developing buildings that make a positive contribution to the community. We are a US-based global company with a portfolio spanning 205 cities and 24 countries. But it’s our local knowledge and relationships on the ground which truly help us connect with and understand the communities in which we are investing. Here in Houston, the three million-square-foot Galleria is a fantastic example where we integrated a mixed-use scheme with the community. The complex helped create the southwest zone of the city, bringing new and exciting amenities, while acting as a catalyst for the improvement of local infrastructure. We have capitalised on this experience to adopt a similar philosophy for developing large-scale mixed-use urban schemes which interact with and complement the local communities. The pioneering Porta Nuova mixed-use project in Milan and most recently Cherrywood – the largest new sustainable greenfield urban development in Ireland – are excellent examples of this approach, where making a positive physical, environmental and social impact on local areas is paramount.

Can you give some examples of environmental features and techniques you are adopting as part of your sustainable development?

We are seeing increasing demand for our expanding all-timber framed product T3 – which stands for Timber, Transit and Technology – utilising renewable all-timber construction to create a vintage aesthetic and warehouse environment with the efficiency and amenities of new construction.

We are also exploring innovative ways of advancing new technologies to reduce our carbon footprint, including embracing the use of new materials to reduce the environmental impact. We have begun to use drones to help us project manage, which is increasing both our accuracy and efficiency. From construction to the operations and management of the building, our focus is to harness the latest technologies to work with our partners towards net-zero carbon and net zero energy.

What impact do you think the pandemic will have on the future of ESG in real estate?

It’s too early to answer that question with any degree of accuracy. At Hines, we had a pandemic plan as early as 2003 which we actually updated last year, and no we don’t have a crystal ball!

As a real estate company, there is nothing more important to us than people; their lives and quality of experience in our buildings. The pandemic has accelerated the health and wellbeing trend we were already seeing grow before and will now become a critical part of our ongoing operations and engineering of buildings.

From a sustainability perspective, we look at this as an existential crisis and, combined with other global shifts such as climate change, it is bringing ESG front and centre. The need to demonstrate resilience, flexibility and adaptability throughout our built environment is fundamental.

We have seen more investor interest around ESG in the last six months than ever before. Because of the realisation that the crisis was caused by something unsustainable, we simply have to shift to a more sustainable built environment.