June 29, 2021
Written by Emma Cullen, COO UK, Fiera Real Estate
When I first started down our digital transformation path four years ago, I had no idea where it would lead. I hoped for greater efficiencies in the way that we operated, enhanced transparency, faster reporting timelines, verified data and a refined and auditable process. I had no idea what lay ahead. So, we scoped, we planned and dived into the unchartered territory of tech project management. We encountered dead-ends and began to realise that there were a lot of opinions, but not an equivalent number of solutions. We discovered that our internal brain was the gold dust and that the tech’s biggest issue was simplicity – its design being so much more important for the end-user than the technology. So, we switched paths – we took the idiom “the map is not the territory” and decided that we wanted our own optic on our own data. I found a wizard (thank you David Bender) and we developed internally so that the tech could fit our business. We designed our own database, built our own custom data applications and, through the vision of our Canadian cousins, created the infrastructure to connect with any third-party data source.
In parallel, ESG was moved to the forefront of investment decision making. The need to become part of the decarbonisation solution and be able to efficiently value, measure and integrate ESG issues into investment analysis was the goal. I needed another marvel (enter Jessica Pilz). Then we hit the sweet spot: data analytics needs a purpose and ESG and data analytics combine beautifully. We began to understand how we could leverage our data capabilities to keep us one step ahead in compiling our own ESG data. Lack of data quality remains a challenge for many looking to build ESG data baselines in real estate. Data collection can be tricky if you don’t have access to the raw data, so how do you build a baseline of utility data when you own the asset, but you have no control over its operations? How do you decide what is a reasonable baseline of data when there is no single standard and the frameworks around data are constantly evolving? For FRELIF, our long income portfolio with an underlying asset base of FRI leases, we identified a solution by working with a third-party data harvesting company. Most utility data is cloud based, so alongside intensive tenant engagement we effectively scraped their invoiced data from an online portal and dropped it into the data warehouse. We worked with our Operating Partner network so that project level ESG data could be fed directly into the warehouse. With a wealth of available data, we now have a robust foundational ESG data set from which we can properly target set, identify opportunity and manage risk. In doing so we are creating our own reporting framework from which we can satisfy the external need for performance metrics and properly target set.
In the absence of a single standard, as an industry we should be looking to work together and self-regulate by trying to reach agreement with our peers on what a reasonable baseline of standardised ESG metrics look like.
Until then, Fiera Real Estate will continue the global capture, harness and analytics of high quality ESG data through our digital platform to better understand how to meet our industry’s social and environmental challenges. At Fiera Real Estate, we remain responsible, resilient and engaged.