Dive Brief:
- CBRE is tapping risk analysis platform Climate X to provide climate risk data to occupiers and property owners as part of its sustainability planning and reporting efforts.
- The partnership agreement will enable CBRE’s sustainability specialists to translate climate risk scenarios and hazards into more straightforward information that can help clients evaluate locations and identify potential climate risk-related threats, according to a news release Thursday.
- “Companies are operating in a world of increasing climate risks while also trying to advance their efforts to reduce emissions across their portfolios. This challenge will become more daunting as global temperatures continue to rise,” CBRE Chief Sustainability Officer Rob Bernard said in a statement.
Dive Insight:
In addition to prompting energy efficiency improvements and emissions reduction-related measures, climate change-related pressures are increasingly driving property owners and operators to focus on portfolio- and building-level resiliency. The U.S. experienced 28 separate billion-dollar extreme weather events in 2023, totaling $92.9 billion in recovery costs and exceeding records for both the number and cost of such events, according to a May report from the Deloitte Center for Financial Services.
In total, these events accounted for a 56% increase from 2022 and a 180% rise from levels in 2013. Assuming a similar annual trajectory, there could be as many as 42 separate billion-dollar extreme weather events by 2030, the report says. The proliferation of extreme weather events across the U.S. has contributed significantly to a jump in insurance costs for commercial real estate properties in the past 10 years, with the average cost per building jumping from $1,558 in 2013 to $2,726 in 2023.
Climate X’s platform is aimed at helping owners and operators to calculate the risks associated with such events, such as coastal flooding, drought, extreme heat, landslides, storms and wildfires. By partnering with the risk analysis firm, CBRE can better help clients calculate capital expenditure requirements and return on investment for retrofits and acquisitions that increase adaptation and resilience, according to the release.
“Climate change is redefining how and where companies operate,” ClimateX CEO and co-founder Lukky Ahmed said in a statement.
Ahmed noted that the platform will enable CBRE to provide clients with ROI-driven approaches to mitigating the climate impacts across an asset’s lifecycle, while CBRE’s Bernard said that the agreement will simplify the complexity of handling climate change-driven risks to better handle decarbonization strategies “at a global and asset level.”
As CBRE seeks to simplify the complexity of sustainability initiatives, it will continue to expand its focus on climate risk and its potential impact on clients’ local and global portfolios, it said.
The agreement with Climate X follows two other sustainability- and climate-related partnerships CBRE forged in 2023. One was an agreement with Deepki, announced last May, to deploy its landlord-focused real estate sustainability data intelligence platform to commercial properties. CBRE said this would enable customers to collect energy, water and waste consumption data, providing a comprehensive view on environmental performance at the portfolio and asset levels.
CBRE also formed a strategic partnership with carbon accounting software provider Emitwise in September, enabling customers to collect greenhouse gas emissions data from its supply chain and provide carbon accounting capabilities to its suppliers.
