New European real estate guidance launched for low-carbon future

New guidelines have been introduced to help European real estate CEOs navigate and succeed in a low-carbon economy by developing robust climate transition plans. 

Transitions Plans Guidance

These plans are crucial for companies to maintain viability and attract investment, as they outline how business models, assets, and financing will adapt to protect and enhance long-term value. Companies with credible plans are more likely to secure capital, favourable financing, and stronger relationships with stakeholders, while those without face increasing risks from investors, banks, and insurers.
The "Transition Planning Real Estate Guidance" builds upon the global Transition Planning Taskforce (TPT) Disclosure Framework, offering a sector-specific approach. It helps CEOs create actionable plans by focusing on ambition, action, and accountability. This framework enables companies to demonstrate how they will manage climate risks, prioritise retrofitting and resilience, and align capital expenditure and operations with a low-carbon pathway. It also highlights immediate and medium-term transition requirements.
Sector-specific guidance is vital for real estate due to the unique challenges of long-lived physical assets, complex ownership structures, tenant dynamics, and planning constraints. The guidance provides practical advice on how real estate organizations can translate climate ambition into tangible actions, including:
Identifying key transition risks and opportunities.
Integrating climate assumptions into financial modeling and valuations.
Aligning governance and internal operations with climate goals.
Coordinating efforts with tenants, suppliers, lenders, and advisors.
Preparing for evolving regulations and investor expectations.
Suzy Glass co-CEO, BRAE, explained: “Real estate’s response to climate change cannot be business as usual. That business-as-usual approach has typically seen climate issues mostly managed by ESG teams. Transition planning does not add an extra reporting burden but instead provides an umbrella to move existing initiatives from being asset-level and compliance-driven to climate action being led strategically from the boardroom. That shift in governance is essential if companies are to demonstrate credible leadership to investors and lenders.” 
James Hooton, managing director of Missions at the Green Finance Institute, added: “Decarbonising the real estate sector calls for coordination between policy, developers, investors and businesses to mobilise the billions in investment required,” says “This guidance is an important tool to help the real estate sector move beyond incremental asset-by-asset change and shift their approach to attract investment and build resilient, future-ready businesses.”
This new guidance was developed with significant contributions from the Institutional Investors Group on Climate Change (IIGCC), the Green Finance Institute (GFI), the Global Real Estate Engagement Network (GREEN), and BRAE, a climate and innovation strategy consultancy. Additional input came from the Institute for Human Rights and Business (IHRB) and ShareAction. The initiative also has the backing of industry organisations such as AREF, EPRA, INREV, the Loan Market Association, and the Urban Land Institute.