With energy consumption playing such a key role in our journey to net zero carbon, it’s no surprise that industry benchmarks like GRESB are responding.
If you’re responsible for ESG reporting in real estate, GRESB’s recent updates on energy efficiency standards are worth paying attention to. Their collaboration with ASHRAE marks a clear shift in how buildings will be scored, and it has real implications for how assets are managed and reported.
So, what’s changing and what does it mean for you? We’ll break it down.
Expectations around energy efficiency.
GRESB has always been a mark of respect in the real estate market. It’s been a stamp of excellence and a way to prove sustainable responsibility, while also driving real value and proving significant advantages during asset trades. Well, GRESB wants to make sure their scoring system remains ahead of the rest and continues to only reward the premium standard of real estate.
The new scoring system will reward buildings that do either, or both of the following:
Show consistent Year on Year improvements, or
Operate at a high level of energy efficiency, maintained continuously
This is in response to, and in preparation for, the increasing number of buildings which are performing at a consistently high level of energy efficiency and therefore don’t have as much room for year-on-year improvement. To fix that, GRESB is starting to include performance thresholds that define what a “highly efficient” building looks like. If a building meets or maintains that level, it can still score well, even without major year-on-year changes. This assessment rewards the best of the two outcomes.
Why like-for-like isn’t enough anymore.
The old system mainly rewarded “like-for-like” improvement, which meant a building was scored based on how much it improved its energy use compared to the previous year. That’s of course useful, but it didn’t always reflect whether a building was actually performing well overall.
GRESB still see value in tracking improvement, but now they want to combine it with thresholds so buildings are assessed not just on progress, but also on where they stand in absolute terms.
What are these thresholds based on?
This is where the partnership with ASHRAE comes in. ASHRAE is known for creating technical standards for buildings, especially around HVAC and energy use. The GRESB scoring system is now aligning with ASHRAE Standard 100, which includes:
- Energy Use Intensity (EUI) targets for existing buildings
- Adjustments based on building type and climate zone
- Targets based on real data from U.S. buildings (specifically the top-performing 25%)
These thresholds are updated every four years. They’re not based on emissions or grid decarbonisation, so they can be applied consistently, regardless of asset location.
What if your buildings don’t fit the ‘standard types’?
See here for the list of GRESB’s property type classifications to see where your assets qualify, you will find more in-depth information on alignment with ASHRAE building types in your GRESB portal.
GRESB and ASHRAE have aligned on over 55 building types in each climate zone so far. But if you manage buildings that don’t fall into those categories, there’s still some work ahead as GRESB is developing their own thresholds for less common asset types. In the meantime, buildings with strong performance should still benefit from the dual approach: either by improving each year or by maintaining efficiency above a set benchmark.
Is this achievable? Or just another checkbox?
According to GRESB, only 10% of assets in markets with strict area codes currently meet these new EUI thresholds (market being location and building type). That number drops as low as 5% in places with weaker energy codes. In other words, these targets are ambitious, but not impossible, and being set to continue their drive for building excellence. They’re meant to push the market without setting the bar so high that no one can reach it, but the reality is: many properties will need to step up.
That could mean investing in upgrades, introducing PropTech and data solutions, optimising operations, or reevaluating long-term strategies. The good news is, you don’t need to do this alone. Utopi’s end-to-end solution provides, environmental, utilities, and building performance tracking, at both an asset or portfolio level. Having this data at your fingertips on The Utopi Platform means that optimising and proving performance for GRESB applications and beyond is not based on guesswork, but reliable, auditable data. Even going as far as influencing 50% of the GRESB scorecard.
The Roadmap for GRESB.
GRESB is starting with energy, but they’ve made it clear this approach will eventually apply to other areas, like water use, greenhouse gas emissions, and renewable energy. Their end goal is to better measure real-world performance and make ESG scores more meaningful.
They also want to connect energy efficiency more directly to Net Zero readiness. That means buildings won’t just be measured on whether they’re reducing emissions or buying offsets, but on how well they’re actually performing day-to-day. As part of this, applicants can expect the GRESB weighting of energy efficiency to move higher than the current 2.5 scoring threshold.
What you should do now
If you’re reporting to GRESB or preparing to, here are a few things to consider:
- Review your building performance: Specifically, against EUI targets, not just YoY change.
- Understand your climate zone and building type: Under ASHRAE definitions.
- Close data gaps: Incomplete or inconsistent data will hurt your score more under this approach.
- Plan ahead: If you’re currently just scraping by with incremental gains, you may need a longer-term strategy to hit performance thresholds.
The Value of GRESB
It’s all very well discussing alignment with GREBs new EUI thresholds, but beyond sustainable certification, where does the value lie in reporting to GRESB?
Trade assets and manage with ease: Limit roadblocks to asset buying and trading by providing investors with reliable sustainability performance data and engaging asset managers with a clear framework for improvement.
Avoid asset stranding: Prevent your portfolio from falling behind resalable standards or suffering from a ‘brown discount’ by keeping building performance data visible, comparable, and actionable.
Achieve long-term impact and growth: Lay the foundation for resilience, prosperity, and success by optimising your portfolio for financial returns and positive impact.
Unlock new capital pools: Access sustainability linked loans, green investment funds, and attract sustainability driven investors with globally recognised and forward thinking ESG credentials.
As GRESB partners, Utopi’s Advisory Services team are experts in gaining GRESB certification, and can ensure both The Utopi Platform and Utopi ESG Technology can influence points across almost 50% of the current 2024 GRESB scorecard. Totalling 49.75 points across energy efficiency, tenant engagement, Net Zero targets, and much more. Let’s talk about how Utopi can support your portfolio’s attainment of GRESB.