In the reporting year, Swiss Prime Site developed a detailed CO₂ reduction pathway for the entire property portfolio. A CO₂ mitigation target that falls well below the 2-degree goal set out in the Paris Agreement is being pursued with planned investments of over CHF 650 million by 2050.

On 28 August 2019, the Federal Council decided that, from 2050 onwards, Switzerland should emit no more greenhouse gases into the atmosphere than can be captured and stored in natural and technological sinks. This means that our government is going considerably above and beyond its existing commitments under the Paris Agreement.

It has been two years since the publication of Swiss Prime Site’s first comprehensive sustainability report and we can now look back and take stock. Over the course of these two years, there has been a great deal of movement in the area of sustainability and the environment, at both political and social level. Climate activists are dominating the headlines and panel discussions, and the «green wave» has dominated numerous new elections of European parliaments, which are reacting with a clear stance on climate goals.

While the 2-degree goal, which we committed to back in 2017, was fairly difficult to understand as a scientifically derived value, «net zero» leaves no room for interpretation. That’s a good thing, but is the target actually achievable? This is precisely the question we aimed to answer when pursuing our own objective of developing a reduction pathway for the entire Swiss Prime Site property portfolio by the end of 2019.

This detailed reduction pathway, which is being published for the first time in this report, forecasts an influenceable 75% reduction in relative CO₂ emissions (intensity) by the year 2050 for the approx. 1.6 million m² of floorspace, assuming a continued average increase in area of 20 000 m² per year.

We are very optimistic that we can fall well below the limits of the 2-degree goal with all the measures available to us. It is also clear, however, that we will not be able to achieve «net zero» without the help of possibilities to offset. At the same time, assuming responsibility also means recognising the limits of what is possible and – in contrast to politics – not hastily spreading ideas that aren’t feasible in reality.

Responsibility and credibility

It paints a deceptive picture when governments, and thus individual companies, are already committing themselves to zero emissions without having any real idea about whether and how they can achieve this ambitious goal or how much they will have to invest in it. We have done the maths: more than CHF 650 million will be needed for investments in building shell renovations and replacement heating measures, which will need to be allocated appropriately over the next 30 years. In addition, we estimate the cost of carbon offsetting measures to be around CHF 2 million annually from 2050 onwards. But the good news is that we can afford this ambitious target without suffering financial losses or the total return being affected, as these costs have already been reflected in the individual property valuations.

We now see it as our clear-cut duty to take all necessary measures to consistently follow our reduction pathway and to represent it as an integral part of our long-term financial planning. At the same time, despite tackling the big challenge of continuously reducing CO₂ emissions, we must not lose sight of the other dimensions of our sustainability strategy. In particular, we have a responsibility to deal with the issue from all possible angles.

«We have a responsibility to pursue a long-term sustainability strategy that we can implement ourselves and which is part of our DNA.»

For Swiss Prime Site, assuming responsibility means considering a wide range of issues, continuing to evolve in all areas, and being a leading voice on relevant issues as one of the main players in the industry. The circular economy, green leasing, biodiversity and climate-adapted construction are just some of the current trends that we will be focusing our attention on in the coming months and years.

We earn credibility by addressing and dealing with these issues in specific projects. Removing, recycling and reusing an old aluminium façade as a fresh face for the same property in Zurich is just one example of the pragmatic approach we take to the complex topic of the circular economy.

Attitude and goals

Goals are supposed to be challenging, not formulated in a way that makes them easily attainable. We have analysed the progress made in the area of sustainability for the past two years and come to the conclusion that we have already achieved a great deal. Nevertheless, we are still only at the very beginning of a long journey and a real transformation.

«Goals are supposed to be challenging, not formulated in a way that makes them easily attainable.»

The fact that the issue of sustainability has taken on a whole new significance at Swiss Prime Site is also due to members of the Board of Directors – namely the Chairman, Hans Peter Wehrli, and Barbara Frei-Spreiter – having joined the Sustainability Board this year. This board will make a decisive contribution to the formulation of goals in future and to the long-term orientation of the sustainability strategy.

In this report, we want to show in detail the areas in which we have made progress, as well as those where we believe action is still required. The task is to convey our specific company stance not only to expert analysts and interested shareholders and stakeholders, but also to our own employees, and to provide transparent and detailed answers to the question of how Swiss Prime Site can create sustainable value.

I hope you enjoy reading this report and that it gives you many interesting insights into our sustainability-oriented business activities.

Urs Baumann
Head Group Sustainability & Innovation

During the 2019 materiality analysis, Swiss Prime Site determined which issues are particularly important to its stakeholders and to safeguarding its short-, medium- and long-term business success. The Company also evaluated which issues have a significant impact on economic, social and environmental development. The materiality analysis thereby forms the basis for the strategic focus of reporting, as well as for the integration of important financial and non-financial issues into the management of the group (GRI 102-49).

Differentiated approach in three fields of activity

Due to their different characteristics, the various business activities of Swiss Prime Site call for a differentiated view of the material issues. The materiality analysis was therefore performed from the perspective of the following fields of activity:

• Real estate (Swiss Prime Site Immobilien, Wincasa, Swiss Prime Site Solutions)
• Retail (Jelmoli)
• Assisted living (Tertianum Group)

This approach made it possible to tailor the issues more to the different activities and their company-specific characteristics during the analysis. In the area of assisted living, for example, the health and safety of guests was identified as a key issue, while in the retail area aspects such as brand strategy and customer footfall were covered. For real estate, optimum connection of the properties, as well as resource consumption and CO₂ emissions, were highlighted as key factors.

The issues, which are prioritised on the basis of their materiality, are arranged according to the six capitals that determine the structure of the sustainability roadmap: stakeholders, finance, infrastructure, innovation, ecology and employees. The six capitals correspond to the sustainability dimensions introduced in 2016 and reflect the Company’s integrated approach to creating sustainable value for the various stakeholder groups from a wide range of resources.

For each field of activity, the aim was to assess how important the particular issues are to the different stakeholders on the one hand, and to the business success of Swiss Prime Site on the other, and also how important the issue is with regard to the Company’s impact on sustainable development. This procedure is derived from the sustainability reporting guidelines of the Global Reporting Initiative (GRI), which describe how to evaluate stakeholder relevance and assess impact. Assessing business relevance as the third dimension ensures that the material issues are closely related to the core business and can be integrated into the strategic management. The process is therefore also compatible with the recommendations of the International Integrated Reporting Council (IIRC).

Integration of internal and external stakeholders

To assess business relevance, representatives of the company management were interviewed. In order to include the opinions of the most important external stakeholders, Swiss Prime Site conducted an online survey. A total of 36 members of the Executive Board and Management Board, as well as 23 external stakeholders, were invited to take part in the assessment. The Company also took into account the findings of the 2019 Stakeholder Panel. The impact dimension was assessed in an internal analysis. The next materiality review will be conducted as part of the 2021 Stakeholder Panel (GRI 102-46).

Results of the materiality analysis

The following illustrations show which issues were deemed to be material in the materiality analysis in the three dimensions «relevance to stakeholders», «relevance to long-term value creation» and «impact on sustainable development». The focus here is on the results of the core real estate business.

Inclusion of material issues in goal setting

The materiality analysis serves to align the financial and non-financial reporting with these material issues. The identified issues are systematically covered in this Annual Report and in the accompanying GRI Report. The materiality analysis also serves as a starting point for further improving the integrated management of financial and non-financial aspects. During the implementation of the sustainability roadmap, the Company defines goals from which it then derives measures that correspond to the material issues.

Swiss Prime Site sets itself long-term goals. When doing so, it is guided by national and international frameworks, such as the Energy Strategy 2050, the Paris Agreement and the Sustainable Development Goals (SDGs) of the United Nations. Sustainability management is focused on the material issues defined during the 2019 materiality process.

From these, Swiss Prime Site derives a sustainability roadmap, which includes responsibilities, short- and medium-term goals and corresponding implementation measures. This roadmap forms an integral part of the annual business-plan process. The roadmap is structured according to the six capitals of the «integrated reporting» approach. On the basis of this roadmap, Swiss Prime Site assesses the achievement of goals and defines additional measures if they are not met.

Sustainability goals are set across the six capitals, both at group level and for the individual group companies. Whereas the group’s overarching goals are described for all six dimensions, the main focus at the operational level for 2018 and 2019 was on the working environment, digitalisation and raising energy-efficiency levels in the group’s operations and its property portfolio.

The overview shows that the majority of the defined goals were met. However, the requirement for all employees to recommit to the Code of Conduct was not implemented. Instead, new employees were given a presentation on the Code of Conduct within the context of the Welcome Days.

There is further need for improvement with regard to implementing Building Information Modelling (BIM) for new development projects and reducing the turnover rate. Corresponding goals for 2020 were set during the reporting year. The data-protection concept was introduced as planned – a detailed evaluation of its functional adequacy is scheduled for 2020. To further reduce the impact on the environment, for 2020 Swiss Prime Site is aiming to cut revenue-related CO₂ emissions by at least 5%. Furthermore, initial discussions will be held in 2020 on how to certify the entire Swiss Prime Site Group according to ESG criteria from 2021 onwards. The Company fell far short of its goal of reducing the turnover rate to below 18%. Swiss Prime Site will therefore endeavour in 2020 to reduce the turnover rate to below 20%, which is still an ambitious goal.

The objectives of Swiss Prime Site are based on the Sustainable Development Goals (SDGs) adopted by the UN member states. The 17 SDGs and their 169 constituent targets came into effect on 1 January 2016 for a period of 15 years. They are part of the 2030 Agenda for Sustainable Development and are aimed at governments, the private sector, the scientific community and civil society. Companies can use the SDGs as points of reference to link their commitments and key performance indicators to sustainable development at the global level.

Contribution of the Swiss Prime Site Group

In accordance with the principle of materiality, Swiss Prime Site determined which SDGs it can influence most significantly with its business activities. To this end, the Company first assigned all SDGs to the six dimensions of the sustainability roadmap. The following goals are less relevant to Swiss Prime Site or cannot be influenced by it: SDG 1 (No Poverty), SDG 2 (Zero Hunger), SDG 3 (Good Health and Well-Being), SDG 6 (Clean Water and Sanitation), SDG 7 (Affordable and Clean Energy), SDG 10 (Reduced Inequalities), SDG 14 (Life Below Water), SDG 15 (Life On Land), SDG 16 (Peace, Justice and Strong Institutions). In addition, due to the clearly defined statutory provisions that apply to employers and employees in Switzerland, SDG 5 (Gender Equality) was excluded on the grounds that all businesses are expected to observe the goal anyway as a matter of course.

In a second step, seven of the 17 SDGs which were identified as priorities in the initial process were then mapped onto the structure of Swiss Prime Site and its business fields using an additional matrix. The following goals were considered to be material to Swiss Prime Site: SDG 4 (Quality Education), SDG 8 (Decent Work and Economic Growth), SDG 9 (Industry, Innovation and Infrastructure), SDG 11 (Sustainable Cities and Communities), SDG 12 (Responsible Consumption and Production), SDG 13 (Climate Action), SDG 17 (Partnerships for the Goals).

From these seven SDGs, Swiss Prime Site derived the following adapted goals:

Focus on safe, resilient and sustainable cities and settlements

It had already been suggested during the 2017 Stakeholder Panel that a guiding principle be defined for the Swiss Prime Site Group’s corporate responsibility. The Company considers SDG 11 «Sustainable Cities and Communities» to be a suitable starting point for such a guiding principle, as several trends that have a significant influence on the core business can be classified under it. Among others, these include urbanisation, intergenerationality and climate-adapted design of living spaces. Focusing on individual goals not only fosters communication with stakeholders but also opens up the development of new products and services. Swiss Prime Site is therefore aiming to make its own contribution to the «Smart City» strategy, which is based on SDG 11. This will be the responsibility of the Sustainability Board that was newly appointed in 2019.

At the heart of Swiss Prime Site’s business model lies the evolution of «space within living space». Project development, construction and management, as well as company and third-party utilisation of properties, are key steps in this process. Swiss Prime Site develops and maintains sites and properties in accordance with the highest quality standards and in alignment with current and future market requirements. The aim is to ensure long-term value creation and continuous growth of the property portfolio. In pursuing this objective, the Company takes a holistic approach to corporate management, which, along with economic performance, also takes into account social and environmental aspects and is therefore geared towards safeguarding the Company’s long-term business success.

Alignment with customer and market requirements

The resilience of the business model is continuously assessed in light of social, political and regulatory developments and adjusted if necessary. Relevant trends, such as digitalisation, demographic changes or immigration can lead to expansions and adjustments of the value creation chain. Other influencing factors include market trends that necessitate the revitalisation of properties which are no longer suited to current needs, or changes to the interest rate environment. Alongside these macro and market trends, the needs of the main stakeholders also shape the environment in which Swiss Prime Site’s business model is embedded. The challenge is to address the concerns of customers, investors, the public sector, project partners and employees on a continuous basis.

Vertically integrated group companies

The different value creation stages of the business model are vertically integrated across the five group companies Swiss Prime Site Immobilien, Wincasa, Tertianum, Jelmoli and Swiss Prime Site Solutions. The real estate portfolio comprising CHF 11.8 billion in properties is actively expanded and optimised by Swiss Prime Site Immobilien through acquisitions, developments, conversions, construction, financing and where necessary divestments. Wincasa plays an important role in the group structure by managing the properties of Swiss Prime Site Immobilien and third parties. The business model also allows use of part of the property portfolio: As a service provider in the assisted living sector and a premium department store respectively, Tertianum and Jelmoli use properties in the portfolio and therefore contribute also to the further strengthening of the business model. Swiss Prime Site Solutions has been offering comprehensive services for third parties as an asset manager since 2017. These range from acquisition, to development, conversion and construction, through to financing and divestment.

The portfolio of services provided to support the initial investment therefore covers every phase of the real estate life cycle, which broadens the earnings base while also spreading the risk.

Benefits for all group companies

The group structure of Swiss Prime Site enables its group companies to benefit from each other in a number of ways, be it by exchanging resources and expertise or from the fact that they can provide each other with access to different markets. In Swiss Prime Site Immobilien, Tertianum and Jelmoli can rely on having an owner with significant investment power, while they in turn represent reliable tenants and help the properties to retain their value. For Wincasa, Swiss Prime Site Immobilien is a key client who can develop innovative services. In return, Wincasa provides Swiss Prime Site Immobilien with important local insights into current market trends and client needs. Swiss Prime Site Solutions also benefits in myriad ways from the group structure. For example, the financial services were developed in close cooperation with Swiss Prime Site Immobilien. There is also a regular exchange of knowledge between asset managers in the two group companies. Together with Wincasa, Swiss Prime Site Solutions can offer additional «one-stop» services.

All group companies also benefit from overarching processes. Swiss Prime Site uses an innovation management system that spans the whole group. Future scouts working across the group identify trends that are relevant for the development of business in all group companies. Furthermore, marketing and branding as well as modern information technology architecture and contemporary employee development underpin the business model to further develop the concept of «space to living spaces».

Swiss Prime Site sees value creation as a comprehensive concept. Accordingly, business activities do not just focus on fulfilling financial objectives; they also look at non-financial aspects to ensure long-term value creation. The Company follows an integrated approach which focuses on innovation activity and added value for shareholders, customers, employees and suppliers as well as on responsible management of resources and the environment and positive relationships with other stakeholder groups.

Swiss Prime Site thus strives to continually optimise its value creation in accordance with the following six capitals of the International Integrated Reporting Council (IIRC):

Stakeholders

Relationship capital refers to the value of the network of all relationships with Swiss Prime Site customers and stakeholders. Sharing common objectives and values and creating trust is a strong basis on which to exchange valuable information. These relationships ultimately increase our reputation and add value to the company brand.

To strengthen stakeholder relationships, the Company maintains regular dialogue with all stakeholder groups and coordinates communications measures in a timely and appropriate manner. All group companies stay in close contact with customers in order to ensure they are satisfied and to react quickly to any new requirements. In 2019, another stakeholder panel took place, in which the topic of corporate responsibility was discussed with key internal and external stakeholder groups. Regular communication with investors and analysts was also a priority throughout the reporting year. This resulted in an increase of the number of registered shareholders to 11 266. In 2019, all agenda items at the Annual General Meeting were approved by the shareholders.

Finance

A stable and future-oriented company is based on financially sustainable management. Financial capital incorporates all the financial resources that Swiss Prime Site utilises to develop and render products and services. In addition to income from operating activities, financial capital includes funds released from targeted divestment and funds raised on the capital markets.

In 2019, Swiss Prime Site generated CHF 628 million in operating profit, 31% up on the previous year. Thanks to skilfully executed investments of around CHF 521 million and responsible management, 2019 was also a good year for shareholders. Earnings per share were CHF 8.00.

Infrastructure

One of Swiss Prime Site’s core tasks is to continue developing its products and services across the group and to ensure that they meet the needs of its customers and markets. Infrastructure encompasses real estate that is developed, used, rented or sold, as well as all the facilities that are used to provide our other real estate-related services.

The attractive spaces held in the portfolio were further enhanced in the reporting year by the completion of several construction projects including the YOND new build in Zurich Albisrieden and the redevelopment of Stücki Park in Basel. In addition, innovative products such as the Flex Office co-working spaces were developed. The portfolio currently comprises 187 properties. Total floor space increased to 1 604 451 m², while proactive management reduced the vacancy rate to 4.7%.

Innovation

Intellectual capital is founded on the continuously developing expertise within the Swiss Prime Site Group and the intangible assets developed in collaboration with partners, such as patents, brands, software, rights and licences. Systems and processes that derive from these assets create specific competitive advantages in the market and actively help to capture future potential.

The positive performance achieved by Swiss Prime Site also reflects its forward-looking innovation strategy. Prior to the Accelerator Workshops conducted in 2019, approximately 250 start-ups were assessed for potential collaboration. The selection of topics considered by the Future Board also expanded further in the reporting year and led to six specific innovation projects.

Ecology

Natural capital refers to environmental resources from renewable and non-renewable sources needed now and in the future to render services. Managing soil, energy and water resources responsibly is a major priority for activities across our real estate business.

Swiss Prime Site acts to protect the environment and conserve resources, whether in its daily operations or in investments in real estate and its management. At the same time, the focus is clearly directed at the real estate portfolio, where invested capital realises the greatest impact. In 2019, Swiss Prime Site developed a CO₂-reduction pathway for the property portfolio, based on ambitious energy consumption and emissions goals. The Company also analysed the portfolio with the aim of driving forward the increased use of solar energy. The CO₂ intensity of the real estate portfolio (incl. services within properties of the Swiss Prime Site real estate portfolio) in 2019 totalled 22.27 kg CO₂ per square metre.

Employees

The human capital of Swiss Prime Site encompasses all the knowledge, skills and experience of employees needed to bring the desired products and services to the market. The motivation and innovative spirit of the people who work for Swiss Prime Site are intrinsically linked to the implementation of our strategy and the successful sale of our products and services.

Swiss Prime Site’s success depends on how well it manages to retain and attract qualified employees, promote and expand their skills, empower them to assume more responsibility and motivate them. In a competitive market for talent, Swiss Prime Site's objective is always to have the best specialists at its disposal. In the reporting year, it invested around 1.4% of its wage bill in the training and development of its 6 506 employees. The medium-term goal of reducing the employee fluctuation rate to less than 15% is being maintained.

In the reporting year, Swiss Prime Site developed a detailed CO₂ reduction pathway for its entire property portfolio. With planned investments of more than CHF 650 million by 2050, particularly in cladding renovations and heating replacement measures, the goal is a CO₂ reduction pathway significantly above the 2-degrees goal of the Paris Climate Accord. In order achieve carbon neutrality in line with the goals of the Swiss government, Swiss Prime Site will also consider CO₂ compensation measures.

Background

Scientific scenarios such as those published by the Intergovernmental Panel on Climate Change (IPCC)1 predict that the effects of climate change already seen today will speed up and worsen by 2050. The forecasts assume that the costs of rectifying damage to the climate and adaptive measures will rise significantly. The consequences of unchecked climate change will affect Switzerland, too. According to the climate scenarios published by the National Center for Climate Services (CCS)2, Switzerland can expect major changes such as more drought, more frequent extreme weather and significantly more heatwaves.

The political situation will change, too. In August 2019, the Swiss Federal Council increased its climate goals, which form part of the discussion about revising the CO₂ law. The climate goals state a reduction pathway for Switzerland by means of which net emissions can be reduced to zero by 20503. The Swiss Government’s energy strategy4 and the Energy Law that was introduced in 2018 represent significant legislative changes. In addition, many cantons and cities are debating initiatives which would increase requirements for buildings and mobility. The assumption is that city and site developments will insist on medium-term climate budgets which contain emissions limits for real estate developments and managers. Against the background of these developments, Swiss Prime Site has defined its own far-reaching reduction goal and a CO₂ reduction pathway for its own property portfolio.

Initial situation

Swiss Prime Site supports the goals of the Paris Climate Accord5 (2-degrees goal) and a long-term, carbon-neutral Switzerland, to which business needs to be a significant contributor. Previously, the Company pursued a wide range of initiatives and projects to reduce CO₂ emissions. These ranged from energy control, organisational optimisations, potential analyses for the installation of photovoltaic systems through to promoting e-mobility, but most of them proceeded independently from one another. Swiss Prime Site therefore set itself the goal in 2017 of developing a CO₂ reduction pathway for the property portfolio which would align existing projects and initiatives with a long-term, overarching goal, linked by clear guidelines.

The energy management project initiated in 2012 served as the basis for the creation of a standardised CO₂ balancing process across the whole group, which significantly improved the availability and quality of data. The resulting transparency regarding energy consumption and the associated CO₂ emissions contributed significantly towards the development of the reduction pathway and enabled future progress to be reviewed.

The focus of the CO₂ reduction pathway is on the energy consumption (scope 1 and 2) of the property portfolio, which constitutes far and away the greatest part of the Company’s CO₂ emissions. The reduction pathway factors in a total of 165 properties and an annual portfolio growth totalling 20 000 m². As Swiss Prime Site’s property portfolio is comparatively young and technologically advanced, energy consumption and CO₂ emissions are relatively low, making the challenge of further improvements much harder.

Developing the reduction pathway

The first step in working out the reduction pathway was to look at all the different areas in which Swiss Prime Site has a direct impact on CO₂ emissions and in which effective measures can therefore be defined. The influence of external factors, such as break-through technologies, was not initially included. The key action areas are in electrical energy, heating and cladding renovations. Swiss Prime Site takes into account the renovation cycles of the existing properties and the assumed annual growth of the stock (10 000 m² à × kg CO2e/m²) and new build developments (10 000 m² à × kg CO₂e/m²).

By looking at a range of possible actions in the four main areas of activity, Swiss Prime Site was able to calculate three reduction scenarios. Based on these, Swiss Prime Site decided to follow the most ambitious scenario as a reduction pathway and reduce its relative CO₂ emissions by 75% by 2050. This goal is clearly more ambitious than the 2-degrees goal of the Paris Climate Accord.

In order to achieve this defined reduction pathway, a drastic reduction in relative CO₂ emissions is required, from an annual 22.27 kg CO₂per square metre (2019) to approx. 5 kg CO₂ per square metre by 2050. The investment costs already budgeted for cladding renovations (windows, façades, roofs) in the property valuations total CHF 610 million. A further CHF 40 million has been budgeted for heating replacement measures. Any additional costs will need to be elaborated on in stages as part of an analysis of the individual property and spread appropriately over the period of 30 years. Swiss Prime Site is also striving to distribute clusters of measures, such as those planned for 2029 and 2030 according to property valuations, for example, (cf. Figure 3), more evenly over the years, making the reduction pathway smoother.

Currently, Swiss Prime Site does not believe it will be possible to reduce CO₂ emissions to net zero by 2050 through these reduction measures alone. That is why the Company is intending to offset the remaining unavoidable CO₂ emissions through compensation measures, particularly projects within Switzerland. Swiss Prime Site estimates that from 2050, annual compensation costs to offset unavoidable CO₂ emissions will total around CHF 2 million. This calculation is based on the assumption of a future CO₂ tariff of CHF 200 per tonne.

How the reduction pathway will be realised

In order to realise its ambitious reduction pathway, Swiss Prime Site has set clear objectives to be implemented in existing properties and future projects. The Company is guided in this process by the Swiss Sustainable Building Standard (SNBS). New build projects and total renovations will include sustainability aspects as early as possible in the planning phase and will factor these in throughout the property’s life cycle. In the event that certification becomes a requirement, since 2019 all new build projects must qualify for SNBS Level 4.7 The requirements for this level will become even stricter in the future, with the primary objectives focusing on CO₂ intensity.

In addition to these quantitative targets, Swiss Prime Site can also define other criteria to ensure that new builds are emission-free in the medium-term and generate energy in the long-term. These targets include density of use, life cycle costs, mobility, flexibility of use, summer heat protection, accessibility and densification. Complying with additional criteria, however, will depend on the progress of innovation in construction. Swiss Prime Site follows this market carefully and regularly assesses which innovations can be used to increase energy efficiency and reduce the CO₂ balance.

For existing properties, the greatest reduction potential lies in the procurement of electricity and heat as well as in renovation measures. Swiss Prime Site has defined short-, medium- and long-term targets for existing properties which are based on SNBS criteria and must be included in the individual property strategies. Building certifications are checked on a case-by-case basis, particularly in total renovations. Complying with the CO₂ reduction pathway requires the measures set out in Figure 4 to be implemented from 2020. Additional reductions can be made by implementing stricter measures from 2025 and 2035.

Operationalise climate goals

To operationalise the quantitative and time-based goals set out in the CO₂ reduction pathway to reduce CO₂ emissions in the buildings portfolio, Swiss Prime Site developed a holistic energy concept. This contains specific recommended actions to implement the CO₂ reduction strategy for properties. Measures for new build projects relate to both the procurement of energy and how it is produced, stored, distributed, consumed, measured and billed.

In the case of existing real estate, the holistic energy concept will determine the specific property strategies and multi-year plans across the whole portfolio, in which investments to reduce CO₂ emissions are planned long-term and aligned with the valuation.

The holistic energy concept will therefore ensure that the CO₂ reduction pathway is operationalised, measured and evaluated as a defined goal within the Company. It should be clear at any given moment where the Company is on the reduction pathway and under what circumstances any timely compensation measures may need to be carried out.

¹ The Intergovernmental Panel on Climate Change (IPCC): AR5 Synthesis Report: Climate Change 2014, Online, source: https://www.ipcc.ch/report/ar5/syr/

² CCS (Ed.) 2018: CH2018 - Climate scenarios for Switzerland. National Centre for Climate Services, Zurich.

³ Swiss Federal Office for the Environment 28.08.2019: 2050 Climate Goals, Online, source: https://www.bafu.admin.ch/bafu/en/home/topics/climate/info-specialists/climate-target2050.html

⁴ https://www.bfe.admin.ch/bfe/en/home/policy/energy-strategy-2050.html

⁵ Swiss Federal Office for the Environment 2018: Paris Accord, Online, source: https://www.bafu.admin.ch/bafu/en/home/topics/climate/info-specialists/climate--international-affairs/the-paris-agreement.html

⁶ For comparison: The CO2 price in the EU Emissions Trading System was around EUR 24 per tonne in 2019.

⁷ The evaluation scale comprises Levels 1-6; for new builds, all indicators must be level 4 for SNBS certification.