FTSE Group, NAREIT and the U.S. Green Building Council (USGBC) have announced they are in joint development on the first investable green property indexes for both institutional and retail investors.
The new family of green property indexes, which is currently in the final stages of implementation prior to customer use, will be based on the FTSE NAREIT Index Series and green data from USGBC. The indexes will be designed to give investors a structured and disciplined way to measure and model the risk and reward profile of green property using the first codified, transparent definition of listed green property.
Furthermore, the indexes are being designed to provide investors with new ways to incorporate principles of sustainability into their property selections and portfolios, and access this investment theme through index-linked financial products.
‘To date, no comparable benchmark has been available,’ says Mark Makepeace, CEO of the FTSE Group. ‘We've already received expressions of interest from many large asset owners concerned about their exposure to a rapidly changing sector directly affected by the transition to the low carbon economy.’
‘Green building is a win-win, offering both environmental and economic opportunity,’ adds Rick Fedrizzi, president, CEO and founding chairman of the USGBC. ‘Greater building efficiency can meet 85 percent of future demand for energy in the U.S., and a commitment to green building has the potential to generate 2.5 million jobs. The sector has seen incredible growth and is projected to add $554 billion to the U.S. economy each year. This partnership creates significant investment opportunities for those ready to participate in this growing market.’