ARETE Group has implemented ESG strategy
The ARETE Investment Group considers responsible investing as one of its priorities. For this reason, we have successfully implemented an ESG strategy for the ARETE INDUSTRIAL fund. As a result, we have become one of the first so-called “light green” real estate funds in the Czech Republic. Responsible and sustainable investment not only brings value to individual investors but also to society. We take pride in being one of the pioneers in the Czech capital market to introduce international standards. “It is clear that capital appreciation can be achieved in a socially responsible manner. Therefore, our ARETE INDUSTRIAL investment fund evaluates not only financial but also social, environmental, and ethical factors in its investment decision-making process,” explains ARETE’s ESG Manager, Josef Novotný. The implementation of the ESG strategy is just the beginning. We also aim to further develop and extend our sustainability policy in the future and potentially expand our criteria considered for the fund’s investments. As a participant in the financial market, we are obliged to report under the European SFDR (Sustainable Finance Disclosure Regulation) directive whether and how we achieve or aim to achieve a sustainable policy. The ARETE INDUSTRIAL SICAV a.s. fund has chosen to support a sustainable finance policy as defined in Article 8 of the SFDR directive. Taking a comprehensive view on ESG issues in the fund’s investment activities, we address all three letters of the ESG acronym. The letter “E,” representing Environment, involves assessing the impact of companies’ activities (primarily properties, in our case) on the environment. From ARETE Group’s perspective, this includes the use of renewable resources in the ARETE INDUSTRIAL fund’s real estate portfolio and taking active care for its surroundings. We also focus on meeting social criteria represented by the letter “S” (Social) through collaboration with local stakeholders. For example, we contribute to local development by working with municipalities. The fund’s second pillar in the social area is the proportion of satisfied tenants with long-term lease agreements, as well as the evaluation and selection of tenants with business activities that are sustainable for the local region in the long-term. The letter “G” (Governance) represents criteria for responsible company management. Our priorities in this area primarily involve full compliance with legislative and regulatory requirements, fair practices, and adherence to ethical standards reflected in the ARETE Group’s Code of Ethics. The ARETE Group primarily supports sustainability in these areas:Environment We reduce energy demand and carbon footprint of our assets: At least 80 % of the properties in the ARETE INDUSTRIAL fund portfolio must have BREEAM certification rating of “Very Good.” We will install photovoltaic panels on all roofs within our property portfolio where technically feasible. We commit to achieving zero use of electricity produced from fossil fuels by no later than the end of 2050. We are committed to reducing direct greenhouse gas emissions and aim to achieve net-zero emissions by no later than the end of 2050. We support biodiversity: Within our group, we will continue our long-term collaboration with organizations that support biodiversity protection. Our support primarily involves providing financial contributions to their activities, cooperation, and consultation during new construction projects. We have committed, as a group, to plant one tree for every 500 square meters of a newly built lettable area. We support the protection of conversation areas and endangered wildlife species. Water Resource Protection and Waste Management: We have been working on waste reduction and recycling in the construction of buildings. At least 60% of waste from new construction projects will be designated for recycling. Social We care for the health, safety, and well-being of employees and tenants: We regularly ask our tenants and group employees about their satisfaction with their workplace environment. This includes lighting, air circulation and filtration, adequate breakout areas, and collaboration on monitoring and reducing CO2 emissions and other sustainability factors. We commit to conducting an annual tenant and employee satisfaction survey. We create sufficient breakout areas in all ARETE Group spaces. Within the group, we promote long-term collaboration with tenants. For ARETE INDUSTRIAL, the fund’s goal is to enter into long term lease agreements for a period of five or more years and to maintain occupancy levels within the fund’s portfolio at a minimum of 90 %. We support local communities: We have been supporting local communities and nonprofitcorganizations. In the past year, we contributed one hundred thousand Czech crowns to the Olympie football club in Zdice. We also provided a financial grant of half a million Czech crowns to the town of Zdice for community development. Similarly, we supported the town of Rokycany and local associations with a total amount of one hundred and sixty thousand Czech crowns. Our employees regularly participate in voluntary activities to support the environment, such as tree planting and waste cleanup. We support charitable organizations, including the Czech Ski School of Amputees (CSSA), which assists individuals with lower limb amputations. We, also contributed to ALSA, Nedoklubko, and the Chance for Cancer Children Foundation through participation in charitable beach volleyball tournament. Governance We advocate ethical values in management and governance: We commit to an ethical code and whistleblowing rules. We have established a policy for proper governance, and in the future, we will collaborate with suppliers who also adhere to the ARETE Group’s Code of Ethics. We regularly inform and train company employees on the above policies and rules, including the ESG strategy, its implementation, and the subsequent compliance with individual criteria. We promote gender equality and ethical values: As a group, we have consistently advocated and supported gender equality. We fill job positions primarily based on the assessment of candidates’ experience, skills, and abilities. The values and work habits of candidates, which must align with our corporate culture and ethical code, also play a role in selection. In terms of compensation, the group has implemented a fair and non-discriminatory remuneration policy to close gender pay gap.
Looking to increase the value of your buildings? Bet on renewable resources
Our colleague Tomáš Novotný explains in a text for Wealth Magazín why it is worth betting on renewable energy sources when developing and acquiring industrial real estate. “Installing renewables can dramatically increase the market value of your property. The increased interest of tenants in ESG-compliant energy-efficient buildings has already been discussed, but there are other aspects that increase their value. One of them is, for example, gaining prestigious energy efficiency certifications with good results,” says Tomas in the text. Read the full article below:https://wmag.cz/chcete-zvysit-hodnotu-sve-budovy-vsadte-na-obnovitelne-zdroje/
We Have Completed A New Hall Within The Arete Park Valašské Meziříčí
We have successfully finished the construction of a new phase of the industrial park, ARETE Park Valašské Meziříčí. The new hall will offer 10,000 square meters of new premium space to its tenant, DB Schenker. With the completion of the new hall, the total area of the complex within the ARETE INDUSTRIAL fund’s portfolio has now expanded to 20,000 square meters. Our Valašské Meziříčí park features modern solar panels covering the entire roof and charging stations for personal electric vehicles, aligning with our ESG principles. Valašské Meziříčí is an appealing location due to its convenient access to Olomouc, Ostrava, and the Slovak border. Within the complex, we have plans to introduce the third phase, covering approximately 4,500 square meters. Updates on the construction progress will be shared accordingly.
You can’t fool the market. Real estate will get cheaper if money remains expensive
Co-founder of ARETE, Robert Ides, describes the macroeconomic influences affecting the real estate market in his article for Wealth Magazín. Currently, the real estate market is impacted by factors such as the high cost of money and vastly different expectations of buyers and sellers. However, fluctuations in real estate prices are a natural market phenomenon. Once the high cost of money decreases, the real estate market is likely to pick up momentum, and property values will increase. “Market cyclicality is nothing to fear. It’s natural and helps to balance the market in response to changes in money prices,” explains Robert in the article. Read the entire article below:https://wmag.cz/trh-neosalite-nemovitosti-zlevni-pokud-penize-zustanou-drahe/
Philanthropy and socially responsible behaviour are important to us at ARETE
Philanthropy and socially responsible behavior are important to us at ARETE. We have a long-standing positive experience with investments from international foundations into our funds. We are pleased that the returns we have achieved in the past have contributed not only to our success but also to securing necessary resources for philanthropic purposes. However, the nature of philantropy itself has been changing in recent years. We are gradually shifting from spontaneous collections and the bequeathing of entire estates to philanthropic entrepreneurship. Learn more in an article by our colleague, Josef Vojta, on philanthropic capitalism for Wealth Magazine. Full article: https://www.linkedin.com/feed/update/urn:li:activity:7080089092989841408
The approach of ARETE to ESG
At ARETE, sustainability, social policy, and responsible corporate governance. This is why we proudly embrace a comprehensive strategy of ESG commitments. The strategy is based not only on environmental responsibility and the sustainability of our business but also on ethical principles and a commitment to the sustainable development and prosperity of local communities. We are driven by ethical principles and committed to openness and fairness in our relationships with our tenants, investors, business partners as well as our employees. We have developed our complex ESG strategy in collaboration with the renowned consulting agency Ernst & Young, which is among the absolute leaders in the industry. Pillars of our ESG approach E (Environmental) Respect for the environment is essential to us. We aim to promote a sustainable and environmentally friendly approach to the development and operation of our buildings. We continuously seek further opportunities to minimize the environmental impact of our business. Our environmental goals: We will secure BREEAM certification for all newly constructed buildings Photovoltaic panels will be installed on all technically suitable roofs By the end of 2050, we will end the use of fossil fuels to generate electricity in all our buildings We will plant one tree for every 500 square meters of newly built rental area S (Social) Our constant commitment is to develop sustainable and prosperous local communities. We always prioritize health and safety first. Likewise, the satisfaction of our suppliers, tenants, business partners, and our own employees is our priority. Our social Goals: At least 90% of our tenants will have long-term leases of five years or more We will support local non-profit organizations and local charitable projects Each year we will conduct at least two employee volunteer activities G (Governance) All business activities of ARETE are based on ethical standards and moral values. It is essential for us to apply these values in our relations with suppliers, tenants, employees, and business partners. Our governance goals: All our employees will complete training on the company’s Ethics Code of Conduct We will commit at least 90% of our key suppliers to the Supplier Code of Conduct In 2022, we prepared all processes and investment strategies so that we could responsibly subscribe to the principles of ESG (Environmental, Social, and Governance) and sustainability. This year we are continuing our activities and plan to complete the full implementation of ESG.
The real estate market is increasingly influenced by ESG principles. Sustainability is also crucial for us at ARETE.
Likewise, tenants and investors in the real estate market perceive the situation similarly, often making decisions based on adherence to ESG values. The pursuit of sustainability presents a significant opportunity not only for the industrial property segment but for the entire real estate market. “We are building our portfolio of manufacturing and logistics properties with a focus on its energy efficiency, ecological friendliness, and overall attractiveness to tenants who value ESG principles,” explains our colleague Tomáš Novotný in the article for Wealth Magazine. Full article: https://wmag.cz/esg-tu-s-nami-zustane-a-bude-ovlivnovat-trh-s-nemovitostmi/
We have completed a new hall within ARETE Park Plzeň, Borská pole
The industrial park project in Plzeň is exceptional because it is the first overall revitalization of a brownfield by our development team. A complete revitalization of the former meat processing plant has taken place, which has been transformed into a modern complex providing not only a warehouse but also production and sales areas for GIENGER. GIENGER, which operates throughout Europe, focuses on wholesale activities in the field of heating, sanitation, installations, and utilities and has a tradition of more than a quarter of a century in the Czech market. The complex, which includes the above-mentioned hall with a total area of more than 3,600 m2, is gradually being completed and fully occupied by multinational companies with excellent ratings that have signed long-term lease agreements. In line with the ARETE Group’s ESG principles, we are finalizing the BREEAM certification, thus respecting all modern standards associated with the pursuit of sustainable and socially responsible construction.
Is it worth entrusting your property to professionals?
The economic slowdown, increased interest rates, and availability of financing have resulted in the growing popularity of sale and leaseback transactions, not only in industrial real estate. A sale and leaseback of a property can free up a company’s hands and bring in the much-needed capital needed to modernize and implement advanced technologies. “A sale and leaseback free up real estate tied-up capital for the company. Primarily, this can improve the company’s financial ratios and balance sheet structure, reduce the debt burden and improve cash flow and liquidity. In times of higher interest rates, it also reduces the need to take on new loans and accelerates the repayment of old liabilities,” explains our colleague and ARETE CIO Miroslav Barnas in a text for Wealth Magazín. Full article here: https://wmag.cz/vyplati-se-sverit-vasi-nemovitost-profesionalum/
Industrial real estate segment targeted by ARETE Industrial
Robert Ides, co-founder of ARETE, was a guest on Slovak Televízia TA3’s Biznis programme. The topic was the industrial real estate segment, which is the focus of our fund ARETE INDUSTRIAL. Among other things, Robert explained: ✅️ Why ARETE decided to invest in this part of the real estate market ✅️ Whether real estate can withstand the crises we are going through and retain its value ✅️ And why the Central European region is one of the best places to invest in logistics and manufacturing real estate You can watch the full interview here: https://www.ta3.com/relacia/28571/priemyselne-reality-maju-perspektivu
