Measurabl, a technology platform for ESG data management, has acquired building management software company WegoWise. The deal expands its data capabilities and provides access to the residential real estate market.
WegoWise’s utility data automation and analytics software, as well as its services for residential real estate, will be integrated with Measurabl’s existing ESG platform.
Lack of available data is discouraging investment in real estate, as the sector is exposed to both physical climate risk and increasingly strict regulation.
Technological solutions provide a potential solution for challenges around measuring, reporting and improving real estate ESG ratings.
Measurabl aims to help its clients optimise their ESG performance, monitor their exposure to physical climate risk, develop decarbonisation strategies and gain access to sustainable finance.
Its platform allows users to automate their data collection, sync and centralise data while automatically detecting and resolving any errors, set targets on either a broad or a granular basis, monitor progress and communicate their efforts by generating customised reports on demand.
These reports are appealing to stakeholders and can be compared against internationally recognised benchmarks or used to secure valuable certification.
Measurabl’s product has previously only been available for commercial real estate, but its acquisition of WegoWise will now allow it to accommodate the residential market’s increasing demand for ESG data management services.
By integrating WegoWise’s data automation and analytics software, which supports building owners and managers in tracking and improving their assets’ efficiency, into its platform, Measurabl will also begin providing streamlined access to utility data.
Mat Ellis, Measurabl’s founder and CEO said that, “Our product vision is to deliver ESG solutions for every real estate stakeholder — from owners to lenders, occupiers to residents — from meter to market”.
He sees the acquisition as, “another major step in delivering on our expansive vision of removing barriers to sustainability data and making it accessible across the entire real estate industry.”
The challenges of real estate ESG
The built environment is estimated to contribute nearly 40% of global emissions, contradicting economy-wide net zero commitments and demonstrating the ESG failings of the real estate sector.
A 2022 report by the Intergovernmental Panel on Climate Change suggests that around 60% of these emissions could be cut before 2050, but only if sustainable development strategies, resource efficiency and renewable energy policies are introduced.
This places the real estate sector in a complicated position, as although vast amounts of capital will be needed to fund its transition, its physical climate risk is being compounded by increasingly strict regulation that discourages potential investors.
In October 2021, 73% of respondents to a Deepki survey of 100 institutional commercial real estate investors and professionals expected buyers to avoid real estate assets that were lagging behind in ESG ratings.
Another Deepki survey, conducted in 2022 and involving 250 European pension funds, revealed that 40% of respondents had seen their commercial property assets depreciate by between 21 and 30% year-on-year due to ESG failings. A further 18% had observed depreciation of up to 40%.
Despite these findings, the real estate sector still holds some appeal among ESG investors because it provides positive opportunities such as innovative green development, social housing and the rehabilitation of public spaces.
Investors must weigh these positive and negative factors against one another and consider how returns may be affected. An accurate assessment of risk exposure and potential opportunities, however, requires suitable data that is often difficult to access.
The issues with real estate ESG data collection are highlighted by Deepki’s 2022 research, in which 53% of surveyed property investors claimed they struggle to gather high-quality insights on their assets.
Meanwhile, the stringent reporting requirements of efforts to improve data transparency for real estate investments, such as the EU’s introduction of the Sustainable Finance Disclosure Regulation, can result in bottleneck situations as investors grapple to provide a clear picture of their portfolio’s performance.
Obtaining comprehensive ESG data is therefore a paramount objective for the real estate sector, as investors need to understand their portfolio’s alignment with regulatory demands, decarbonisation objectives and desired returns.
Is technology the solution?
Deloittes’ Real Estate Predictions 2022 outline how automated, granular provision and analysis of utility data will soon be a key requirement of real estate ESG reporting.
According to the international consulting firm, “automated data collection and reporting grants building owners and developers the ability to measure structured ESG metrics, especially in terms of environmental impact”.
Its interview respondents showed enthusiasm for technological solutions through higher expectations for returns on smart buildings due to the influence of connectivity on ESG ratings.
In addition to meeting ESG criteria, gaining access to relevant insights will support building owners and developers in developing and implementing strategies for improvement, driving new business opportunities and gaining a competitive edge.
Novel technologies will continue to emerge, evolving to address ongoing complications such as standardisation or the integration of qualitative data that might provide stronger metrics for measuring social and governance factors.