Commercial real estate investors develop strategies to mitigate physical risks related to climate change

CRE stakeholders scrambling to develop mitigation strategies made an important discovery recently: There is a glaring absence of reliable, actionable climate risk data, and it has become a serious stumbling block for investors — not surprising when you consider modern portfolio theory is grounded in risk assessment. Key industry research firms such as MSCI, Moody’s Analytics, the Urban Land Institute and a growing bevy of climate risk startups continue to crunch numbers and refine data analytics. In short, climate risk assessment is all the rage.

“Lately, there has been quite a bit of interest in acquiring hazard and/or risk data from data companies across large geographic areas that can drill down to the asset level — ‘climate data technology providers’ — to jump-start the assessment process,” says Glenn Milner, JLL’s vice president of climate risk. “Most property owners are still in the process of figuring out exactly how to use risk assessment outputs t