NABERS is a national ratings system that measures the environmental performance of Australian buildings. QIC Real Estate submits properties in the QPF, QTCF and QOF / QGOF portfolios for NABERS Energy and Water assessments annually. NABERS Energy and Water assessments commenced for QACPF and QARP portfolios in FY24.

The following average portfolio NABERS ratings were achieved in FY24:

Table 2: QIC Real Estate NABERS ratings¹⁰

¹⁰ Lodgement fees are paid on behalf of QIC to NABERS for each individual rating undertaken.

¹¹ Ratings shown for QPF, QTCF, QACPF and QARP are those received in each financial year, which are based on the performance period for the previous financial year for ratings shown in FY23 and FY24, and for the previous calendar year for ratings shown in FY22, FY21 and FY20.

¹² Ratings shown for QOF/QGOF are those received in each financial year, which are based on the performance for the previous annual period of September to August for ratings shown in FY23, FY22, FY21 and FY20.  Ratings shown for FY24 represent the performance period for the previous financial year.

¹³ QACPF and QARP commenced obtaining NABERS Energy and Water ratings in FY24.

The ongoing implementation of environmental initiatives aims to deliver continuous annual improvements in these ratings, in line with the ESG objectives identified in Our Approach. Prior year NABERS Energy and Water ratings were impacted by COVID-19 lockdowns in Victoria and New South Wales, which has likely partially contributed to score uplift for funds more heavily weighted with assets in these geographies.

Refer to later sections within this Our Performance section of this report for more information on our energy and water performance during the year.

QPF

NABERS Energy and Water ratings for Shopping Centre Base Building: 100%¹⁴ of QPF’s shopping centre portfolio has been rated by NABERS Energy and Water.

• Claremont Quarter, Perth, WA
• Castle Towers, Sydney, NSW
• Westpoint, Sydney, NSW
• Canberra Centre, Canberra, ACT
• Eastland, Melbourne, VIC
• Watergardens, Melbourne, VIC
• Woodgrove, Melbourne, VIC
• Hyperdome, Logan, QLD
• Robina Town Centre, Gold Coast, QLD
• Grand Central, Toowoomba, QLD
• Werribee, Melbourne, VIC
• Epping, Melbourne, VIC
• Coomera Town Centre, Gold Coast, QLD
• Merrifield City, Melbourne, VIC

QTCF

NABERS Energy and Water Ratings for Shopping Centre Base Building: 100%¹⁵ of QTCF’s shopping centre portfolio has been rated by NABERS Energy and Water.

• Claremont Quarter, Perth, WA
• Castle Towers, Sydney, NSW
• Westpoint, Sydney, NSW
• Canberra Centre, Canberra, ACT
• Eastland, Melbourne, VIC
• Watergardens, Melbourne, VIC
• Woodgrove, Melbourne, VIC
• Hyperdome, Logan, QLD
• Robina Town Centre, Gold Coast, QLD
• Grand Central, Toowoomba, QLD
• Werribee, Melbourne, VIC
• Epping, Melbourne, VIC
• Merrifield City, Melbourne, VIC

QOF

NABERS Energy, Water and Waste Ratings for Office Base Building: 100%¹⁶ of QOF’s office portfolio has been rated by NABERS Energy, Water and Waste.

• 111 George Street, Brisbane, QLD
• 33 Charlotte Street, Brisbane, QLD
• 54 Mary Street, Brisbane, QLD
• 63 George Street, Brisbane, QLD

QACPF

NABERS Energy and Water Ratings for Shopping Centre and Office Base Building: 100%¹⁷ of QACPF’s shopping centre portfolio has been rated by NABERS Energy and Water.

• Pittwater Place, Sydney, NSW
• Big Top Shopping Centre, Maroochydore, QLD
• Forest Lake Shopping Centre, Brisbane, QLD
• Kippa-ring Shopping Centre, Brisbane, QLD
• Nerang Mall, Gold Coast, QLD
• The Village Upper Mount Gravatt, Brisbane, QLD
• 301 Grand Junction Rd, Ottoway, SA
• 60-70 Purling Ave, Edinburgh, SA
• 1 Chandos St, St Leonards, Sydney, NSW

QARP

NABERS Energy and Water Ratings for Shopping Centre Base Building: 100%¹⁸ of QARP’s shopping centre portfolio has been rated by NABERS Energy and Water.

• Craigieburn Junction, Melbourne, VIC
• Bathurst City Centre, Bathurst, NSW
• Domain Central, Townsville, QLD

¹⁴ 100% of rateable portfolio for NABERS Energy ratings. Merrifield City (VIC) has recently commenced NABERS Water ratings, with the first rating undertaken in FY24.

¹⁵ 100% of rateable portfolio for NABERS Energy ratings. Merrifield City (VIC) has recently commenced NABERS Water ratings, with the first rating undertaken in FY24.

¹⁶ 100% of rateable portfolio. Development site at 62 Mary St excluded.

¹⁷ 100% of rateable portfolio. Industrial assets are excluded from our NABERS ratings currently due to the nature of these assets meaning the tenant/s typically have full operational control of the entire asset.

¹⁸ 100% of rateable portfolio.

Green Star¹⁹ is an internationally recognised sustainability rating system for buildings, fitouts, and communities. The Green Star Performance Benchmark provides a holistic sustainability performance measure in relation to the operation of existing buildings.

QIC Real Estate submitted all retail and commercial assets (excluding peripherals) for Green Star Performance Year 1 ratings and in FY24 we achieved a 3 Star Green Star Performance Portfolio rating using v1 of the tool. Refer to downloadable ESG Performance Data for individual asset ratings.

¹⁹ QIC is a member of the Green Building Council of Australia who administer the Green Star sustainably building rating tools, and QIC pays an annual fee.

GRESB²⁰ is one of many tools used by institutional investors to engage with their investments, with the aim of understanding the sustainability performance of their investment portfolio and the global property sector.

QIC Real Estate has participated in GRESB reporting since 2012 for QTCF and QPF, and started reporting for QOF / QGOF, QIC Australia Core Plus Fund (QACPF) and QIC Active Retail Property Fund (QARP) in 2016.

We continue to work closely with GRESB through our memberships with the Green Building Council of Australia and Property Council of Australia, and their broader membership base, to ensure the GRESB benchmark continues to evolve as a useful tool for investors to understand and compare performance, reward demonstrated leadership in real performance, and appropriately measure the industry's contribution to mitigating climate change impacts and the many other significant ESG challenges faced by Australian real estate managers. Our 2024 results, alongside prior year results, are detailed in Table 3.

²⁰ QIC is an investor member of GRESB and pays an annual fee.

²¹ Average score of all GRESB participants in 2024.

Table 3: FY24 GRESB ratings*

*GRESB survey responses are completed using a financial control reporting boundary.

A summary of our GRESB results follow.

• GRESB results shown for each year relate to the prior calendar year performance period. For example, our 2024 results relate to the CY23 performance period.
• All five real estate funds received a 5 Star GRESB rating in 2024, placing them in the top quintile or 20 per cent of performance globally. 5 Stars is the highest rating available in GRESB reporting, recognising global industry leaders.
• Improvements were seen in the 2024 scores for QPF, QTCF, QACPF and QARP when compared to 2023 results. This is largely attributed to the continued roll out of our large scale on-site solar program, resulting in more renewable energy use by our assets, and extending the use of building certifications such as NABERS and Green Star across more of our asset portfolio.
• QOF / QGOF’s score declined slightly in 2024 compared to 2023. This is due to occupancy levels across this portfolio of office assets being slower to recover post COVID-19, where an increase in year-on-year resource usage and decline in recycling rates was experienced due to higher occupancy levels during the rated performance period (CY23) compared to the previous year.
• GRESB results across QPF and QTCF have fluctuated in prior years due to COVID-19 related lockdowns causing significant changes in year-on-year resource use and waste generation across this asset portfolio. The QPF and QTCF portfolio includes a large portion of properties in Victoria, New South Wales and the Australian Capital Territory (ACT), where significantly more lockdown days were experienced than in other Australian States and Territories during CY20 and CY21, impacting GRESB scores across 2021, 2022 and 2023.

FY24 performance data provides an opportunity to compare our performance across two years of ‘back to normal’ operating hours and foot traffic, given FY23 was the first financial year since FY19 not impacted in some way by COVID-19 related lockdowns. Several initiatives were undertaken throughout FY24 to improve our performance across the retail and office portfolios against various environmental sustainability metrics. The impacts of these initiatives are evident in the data presented in Table 4 below. 

QIC Real Estate’s large-scale onsite solar rollout program continued to drive improvements in our FY24 performance, with the completion of additional rooftop solar systems at Woodgrove (1.8MW), Eastland (1.1MW), Pittwater Place (0.2MW) and Forest Lake (0.8MW). Renewable energy generated by onsite solar systems accounted for 18% of QIC Real Estate’s total direct energy use in FY24, contributing to a reduction in grid-sourced electricity use, and the avoidance of more than 17,800 tonnes of scope 2 carbon emissions.

Natural gas use decreased by 22% in FY24 compared to FY23. This decrease has been experienced across most sites. A shorter, milder winter, combined with boiler/heating lock-out efficiency measures implemented at several sites, has meant significant reductions in space heating across the portfolio. As weather is a contributing factor to this item, we do not expect that 100% of this energy saving will necessarily be retained in future years performance. 

Total energy use across the portfolio decreased by 3%. The main drivers behind this change are related to lower natural gas use and key plant and equipment upgrades across the portfolio which improved energy efficiency.

Scope 1 carbon emissions decreased by 35% in FY24 compared to FY23. In addition to lower consumption of natural gas (the largest scope 1 contributor), an updated methodology for reporting on Hydrofluorocarbons (a refrigerant gas used in air conditioning systems) was adopted in FY24, using a top-up quantities methodology. The improved reporting more accurately presents refrigerant gas use and related carbon emissions as it is based on actual data instead of relying on industry standard leakage rates to estimate related carbon emissions. However, as this methodology reacts to proactive maintenance and upgrade works, although overall figures are significantly lower than for previous years, we expect figures reported in future years to be more volatile than the previously used methodology. 

Scope 2 carbon emissions decreased by approximately 9%²² in FY24 when compared to FY23. This is due to the continued roll out of our large-scale onsite solar program and the implementation of various energy efficiency initiatives reducing electricity consumption across the portfolio. In FY24 we have additionally commenced reporting scope 2 carbon emissions using an updated emission calculation methodology, and have presented our scope 2 carbon emissions in Table 4 below for the current reporting year using both a Location Based methodology (previously used) and a Market Based methodology (newly adopted).  We plan to continue using a Market Based methodology in future reporting years. This switch in methodology aligns with best practice, in particular as more of our direct electricity use is sourced from renewable energy from our onsite solar installations.

The recycling rate across QIC Real Estate's asset portfolio remained steady at 37% in FY24, equivalent to that of FY23. We expect our performance to improve as additional waste diversion initiatives are delivered throughout FY25 and beyond as part of the national waste contract implementation. With reference to the Greenhouse Gas Protocol 'Corporate Value Chain (scope 3) Accounting and Reporting Standard', our reported scope 3 carbon emissions include Category 3, 5, 13 and 15 emissions from fuel and energy related activities, waste generated in operations, downstream leased assets and investments. scope 3 carbon emissions (tCO2-e) decreased by 18% in FY24 comparing against FY23.

Table 4: Key performance data

Note: This table presents aggregated data from QIC Real Estate's portfolio of retail, office and industrial assets. The FY24 data in the table has received limited assurance. Data from assets that QIC Real Estate does not have operational control²⁵ over is excluded, including our joint venture assets, Coomera Town Centre and Claremont Quarter.

Our calculation methodology for scope 2 emissions from electricity consumption has changed for FY24 where we present our scope 2 carbon emissions for the current reporting year using both a location-based methodology and a Market Based methodology. We plan on using the market-based methodology for FY24 onwards as per Section 2.2 of the National Greenhouse Account Factors issued by the Australian Federal Department of Climate Change, Energy, the Environment and Water. Intensity metrics are calculated by dividing annual usage data by gross lettable area, allowing presentation of relative annual performance while accounting for changes in portfolio structure over time.

This downloadable spreadsheet presents asset level FY24 environmental performance data for each of QIC Real Estate's five funds: QIC Real Estate FY24 Asset Environmental Performance Data.

To calculate the emissions related to major tenants' energy use, QIC Real Estate has:

• Used actual FY24 energy use figures provided by the tenant, or
• Used actual CY23 energy use figures provided by the tenant, or
• Estimated FY24 energy use based on actual FY24/CY23 energy intensity (kWh/m²) of an alternative tenant that most closely matches the expected operational profile of the tenancy that requires estimation. This method was applied to approximately 31% of the total gross lettable area occupied by major tenants across the portfolio of retail assets which accounts for 7% of scope 3 emissions.

²² Comparing location-based emissions in FY24 with location-based emissions in FY23.

²³ Our calculation methodology for scope 2 emissions from electricity consumption has changed for FY24 where we present our scope 2 carbon emissions for the current reporting year using both a Location Based methodology and a market-based methodology.  We plan on using the market-based methodology for FY24 onwards as per Section 2.2 of the National Greenhouse Account Factors issued by the Australian Federal Department of Climate Change, Energy, the Environment and Water.

²⁴ Scope 3 emissions include: emissions from upstream and downstream in the energy supply chain associated with the energy consumption of the base buildings, scope 1 and 2 emissions from specialty tenants on embedded networks, scope 1 and 2 emissions reported by major tenants not on embedded networks, and downstream emissions from waste generation. In previous reporting periods scope 3 emissions from upstream and downstream in the energy supply chain associated with the energy consumption of tenants have been included in reporting, we have refined our approach this year to exclude these amounts. Decrease in scope 3 emissions in FY24 when compared to FY23 can be primarily attributed to decrease in grid CO2e intensity resulting in lower electricity scope 2 and 3 emission factors.

²⁵ The term ‘operational control’ has been adopted from the definition provided in the National Greenhouse and Energy Reporting (NGER) Act of Australia where operational control refers to having the authority to introduce and implement any or all of the following policies for a facility: operating, health and safety, and environmental. Only one corporation can have operational control over a facility at any given time. This concept is crucial for determining a corporation’s registration and reporting obligations under the NGER Act and plays a key role in broader ESG reporting transparency.

QIC Real Estate continued to monitor our annual performance against a set of short-term targets during the FY24 year. These targets can be seen in the table below, along with a status update on our performance against them.

Our current FY25 short-term targets can be viewed in the ESG strategy section.

Table 5: Performance against FY24 goals

²² Comparing location-based emissions in FY24 with location-based emissions in FY23. 

²⁴ Scope 3 emissions include: emissions from upstream and downstream in the energy supply chain associated with the energy consumption of the base buildings, Scope 1 and 2 emissions from specialty tenants on embedded networks, Scope 1 and 2 emissions reported by major tenants not on embedded networks, and downstream emissions from waste generation. In previous reporting periods Scope 3 emissions from upstream and downstream in the energy supply chain associated with the energy consumption of tenants have been included in reporting, we have refined our approach this year to exclude these amounts. Decrease in Scope 3 emissions in FY24 when compared to FY23 can be primarily attributed to decrease in grid CO2e intensity resulting in lower electricity Scope 2 and 3 emission factors.

²⁶ FY23 scope 2 carbon emissions figures use a location-based calculation methodology.  FY24 scope 2 performance outcomes using a market-based methodology have received an additional carbon reduction benefit due to our change from location-based to market-based calculation methodology. To compare like-for-like year-on-year performance, the FY24 location-based calculation methodology figures should be used.

²⁷ QARP’s net zero carbon emissions operating status relates to existing assets held in the fund as at 30 June 2024 which are 100% owned and managed, using a Climate Active certification pathway and definition of operational carbon emissions which includes scope 1, scope 2 and some scope 3 (noting certification is not yet complete and is due for finalisation in Q2 FY25). Note that while the asset level Climate Active certifications for Domain Central, QLD, Craigieburn Junction, VIC and Bathurst City Centre, NSW, once finalised, will apply from 1 July 2023, QARP’s stated date for having achieved net zero carbon emissions is 1 April 2024 onwards to allow for the Fund’s divestment of Hinkler, QLD on 27 March 2024.  Any future asset acquisitions into the Fund will be assessed for their ability to achieve net zero carbon emissions, noting that at least 12 months of operating data covering a full financial year would be required before certification could be contemplated and achieved. The performance outcomes stated here relate to our FY24 targets, noting that our FY24 performance includes Hinkler until it’s divestment on 27 March 2024.

²⁸ Refer to Our Progress for details on our Modern Slavery approach. For further information, read QIC’s latest Modern Slavery Statement.