Retail REIT Kimco Realty Incorporating Green Provisions Into Leases

Will Teichman, director of sustainability with retail REIT Kimco Realty Corp. (NYSE: KIM), joined REIT.com for a video interview at NAREIT’s 2015 Leader in the Light Working Forum in Reston, Va.

Kimco issues a corporate sustainability report based on Global Reporting Initiative (GRI) guidelines. Teichman explained the rationale behind using GRI.

“The GRI standard establishes some basic parameters around which you can create a corporate responsibility report, but there’s a fair amount of flexibility there in terms of finding the content,” he said.

Teichman set up two different categories of corporate responsibility investors. The “responsible investment community” focuses on a detailed set of issues, driving industry surveys and data collection initiatives.

“They have very specific opinions and things that they’re looking for as investment filters,” he said.

The second group consists of traditional investors, who have grown more interested in sustainability, according to Teichman.

“I think they’re probably less familiar with the nitty gritty details in terms of sustainability performance, but they have become concerned that they believe leading companies should have activity in this space,” he said. “In the traditional investment community, corporate responsibility has become viewed as a proxy for effective management.”

Teichman also discussed the rise of green leases, which have clauses in place with sustainability guidelines for tenants.

“At Kimco, we really like to think of a ‘greener’ lease,” he said. “When it comes down to the sustainability components of a lease, it really comes down to specific lease provisions. What we’ve worked to do over time is to improve our base form lease incrementally to include more clauses or to modify existing clauses to promote sustainable activity on the part of Kimco as well as our tenants.”