AEW, a global real estate investment and asset manager, released a new climate-related risk report that examines the combined impact of the costs associated with the energy transition, or greening of assets, and losses from physical hazards on projected prime European real estate returns. The conclusions are based on a portfolio of 964 properties selected (but not owned) by AEW to best reflect the four main property sectors across 196 European market segments in 20 countries.
Improved availability of data has allowed AEW to include, for the first time, an estimate for the average climate-related risk premium linked to physical climate hazards — such as floods, wildfires and wind stress — in its research. AEW’s previous reports analyzed costs associated with the energy transition and building decarbonization. This new, expanded methodology provides investors with a more detailed and realistic estimate of the returns required to fully compensate for these risks when inves
