1315_Nareit Testimonials_REITwise_Huber_v2
04/06/2023 | by Nareit Staff

Betty Huber, partner at Latham + Watkins, participated in a video interview in conjunction with Nareit’s REITwise: 2023 Law, Accounting & Finance Conference held March 21-23 in Phoenix, Arizona.

Huber said that in compliance with the SEC climate proposal, 70% of REITs have already disclosed their scope 1 emissions (direct emissions from operations) and scope 2 emissions (greenhouse gas emissions from purchased energy or power). About 40% of REITs have disclosed their scope 3 emissions (greenhouse gas emissions from a company’s supply chain or value chain).

“[Scope 3 emissions] include your tenants and what they’re emitting. So…under a triple net lease structure, what do you know? How could you possibly know?” Huber questioned, noting that it’s quite difficult for triple net lease REITs to calculate their scope 3 emissions.

She said that in new leases moving forward, REITs will likely need to include covenants to better access this kind of information, and also being information sharing with peers to see what other REITs are doing.

Huber also said that the ESG working groups at all of the REITs she manages include representatives from the legal, finance, accounting, and sustainability teams.

“All four of those arms and possibly others are getting together and trying to find some common knowledge and language, to speak and to respond and comply with regulation, comply with customer requests and employee demands and interest in being greener,” Huber said.