FTSE Russell has unveiled the FTSE EPRA Nareit Green Index series. FTSE EPRA Nareit Green Index series a new series of real estate indices that tilt towards energy efficient and renewables linked properties.

While ESG (environmental, social, and governance) focused strategies have become abundant amongst equity ETFs, and are becoming increasingly popular with fixed income funds, real estate is an asset class that has yet to properly explore such tools.

The new series is seeking to change that by providing an extension to the FTSE EPRA Nareit Real Estate Indices. It globally recognized listed real estate benchmarks which are tracked by over $340 billion in assets.

The FTSE EPRA Nareit indices are managed in partnership with the European Public Real Estate Association and the National Association of Real Estate Investment Trusts.
The new green indices tilt the weight of consituents in their parent indices to favour those firms with higher Green Certification’ and lower ‘Energy Usage’ scores. A company’s Green Certification score is determined through the proportion of its total net leasable area that is dedicated to producing renewable energy, while it’s Energy Usage score is derived using its average energy consumption per square metre of net leasable area.

Source: Etf Strategy

Fulya Altunyay/ fulyaaltunyay@realestatecoulisse.com