In the first episode of Series Three, Matt Flood, Head of Occupier Markets at Landsec, discusses how as a pioneering sustainable developer, ESG is embedded throughout their entire decision making process.
Outlining the importance of partnership, both with their occupiers but also with peers across real estate, he talks about how sustainability has impacted on the design, construction and operation of their development – The Forge.
Holly: Hello and welcome back to the Take 10 with Collier's podcast, I'm your host Holly Brown, head of client strategy here at Colliers.
On series three of the podcast we are talking net zero carbon and all things ESG. For our first episode of series three we welcome a guest from a developer that has been breaking all the net zero glass ceilings. Today's guest is Matt Flood head of occupier markets at Landsec. Matt started his career at DTZ in Leeds and then moved down to their London city office. He joined Landsec over seven years ago and now heads up their occupier markets team, which covers office leasing, retail leasing, commercial partnerships and media, Matt welcome to the podcast.
Matt: Thank you, great to be here.
Holly: Brilliant we're going to jump straight into the questions and you've spoken before about how Landsec are working with their customers to actually help them, you know, achieve their net zero carbon commitments, firstly how are you doing that, and secondly how has the conversation with your customers changed in recent years regarding ESG.
Matt: Yeah it's a really interesting one, it's a fascinating moment to be really engaging on this topic and we spoke to our customers very recently over the last few months to really understand where their perceptions were and their ambitions, and I think they broadly kind of merged into three groups.
Firstly you had those which had really made this a strategic priority at a corporate level and therefore you had this top-down drive to make it integral to their activities.
And the second group was where you had this kind of almost bottom-up pressure coming from their employee-base. You know there's clearly been this wider societal awakening around sustainability and the climate crisis, and that's now translating to people's decisions around where they want to work, who they want to work with, and so that started to force change at a boardroom level as well I think.
Finally, there's a third group where they still weren't quite on the same page in terms of the importance of this, but thankfully that was certainly the smallest group and one we feel is fading away.
And I think what really came through strongly was this need for partnership, this isn't something that we're all going to be able to tackle independently and particularly in real estate it's for the occupier and the landlord to really come together and understand how in partnership they can make a real positive change. And I think if you're a knowledge-based business like Colliers for example, there's only really two main levers you can pull and that's your real estate footprint and business travel. So what we need to do is work out how we can help them understand what the workplace can do to help support their ambitions and I think there's a couple aspects which are really powerful.
I think firstly the workplace can help people from a science-based perspective, so really actually hit their targets to reducing carbon, but secondly what I think is becoming increasingly powerful, is that the workplace can be this very, very tangible statement, it can be a really powerful statement around the brand and how sustainability is integral to what that business wants to be. So I think that's really exciting time, and thankfully rather than being a threat I think we've emerged from Covid really strongly with that momentum intact, which means we can hopefully go from strength to strength.
Holly: Matt I completely agree, and I think that momentum is really building, and it's a case of occupiers relying on their landlords to deliver accommodation that's accretive to their carbon goals. So working in that partnership approach is really what's going to set people apart and I think to retain and attract occupiers that you really want, you're going to have to adopt that.
So I think you're completely right there. It's safe to say that Landsec has always been a pioneer when it comes to both sustainable development and then your own environmental impact with this new wave of net zero carbon promises that we're sort of hearing across the market, do you think the playing field is levelling and if so how do Lansec as a business feel about that?
Matt: Yeah it's a great question, I think we were the first property company to commit to science-based targets and that's a huge amount of, huge source of pride for all of us that work at Landsec, but I think we have to acknowledge that this is an industry-wide effort and collaboration if we can have any chance of tackling this enormous challenge. So personally I think it's great to see more and more businesses making these commitments.
What's critical now is that those statements really translate into meaningful pathways. I think that will take people working together, collaboration, sharing, learning and best practice. To hopefully push us in the right direction, because as an industry we obviously make an enormous contribution to carbon emissions and therefore it's contingent on all of us to try and do more and work together towards that.
I still think we do have an element of competitive advantage, and perhaps that's just through being a first mover, but I think that what really comes through is the extent to which sustainability and ESG permeates all aspects of our business.
Our new CEO joined last year and he made it really, really clear that sustainability has to be the lens through which we make all our decisions, so rather than just being customer-driven or demand-led, this is something that really matters to us and everybody who works here. So, I think it's ensuring that it's really embedded, will help us achieve the best results we can for ourselves and then hopefully the benefits of those occupying and using our buildings.
Holly: Yeah that's really reassuring to hear actually, because the impact that real assets have on the carbon climate and the crisis that we now have is huge, and I guess if we don't all work together then we're not going to be able to reduce our impact as a whole, so I think it's really important that we all work together on it. That being said and Landsec does have some really exciting developments that are coming out of the ground and they're again going to break even more records when it comes to being net zero carbon in the UK. Could you tell us a little bit more about The Forge please and how occupiers responding to its environmental status.
Matt: Yeah yeah I'd love to, I mean The Forge is a huge exciting one for us it's our first kind of genuine net zero carbon development in both design and operation and so that's coming through due to complete next year. I think the real pioneering aspect of it is that we've embraced the design for manufacturing and assembly methodology and how we construct the building.
What that means is you have a lot of aspects which are built off-site and then transported in and the outcome is that we can reduce the embodied carbon by up to 19 per cent, compared to if you were building it in a more regular established fashion. And actually we got a grant from Innovate UK to reflect the fact that this was the first time this type of technology was being used in a commercial office building which is fantastic endorsement.
And then obviously beyond that we've ensured that our choice of materials is a high recycled content, they're locally sourced and then also the designed for a performance approach means you want to minimise the operational energy once it's finished, so there's a design aspect and then once it's in operation. So all the energy will be from renewable sources, it's 100% electric so no fossil fuels will be used in the running of the building, and then on top of that we'll have our own PV panels which can generate the renewable electricity on site as well. So yeah it's a really, really exciting project which it's great to see that starting to take shape ahead of finishing next year.
Holly: That's really brilliant, and has there been any conversations you've had with the occupiers that are sort of starting to look at some of the space and I know it's not PC-ing until next year, but has there been any sort of views from them as to the drive to move there because it's a sustainable building?
Matt: Yeah I think that's that's really interesting, and it's a trend we've always hoped for, but we're starting to see that come through. Is that because of its net zero carbon credentials it almost transcends the location that it's in, so those that might not have necessarily considered Southwark or the micro location where the building sits, the fact it is net zero carbon it can give a business that I say that really tangible example of what they want to be known for and how they want to show their commitment to sustainability, means that we've had people come and take an interest from all over central London, which is really, really exciting, hopefully that'll continue.
Holly: Yeah very exciting, it's so interesting to hear that the environmental well-being of the building is now driving more than location, I just think it's such an interesting thing and hopefully it's as you say certainly going to continue into the future.
Right Matt, we're running a little bit low on time so I'm going to get into my quick-fire question round, right I hope you're ready. Quick, quick answers nice and fast, so would you rather plant a rainforest or re-grow a coral reef?
Matt: Definitely coral reef.
Matt: I'm a big fan of diving, as and when we're allowed to travel, so yeah I’d love to see them come back to life again.
Holly: Me too. Good, would you rather build a wind farm or a solar farm in your back garden?
Matt: I’d love to live somewhere sunnier so I'll go with solar farm.
Holly: A good answer. If you could save one part of the world from global warming where would it be?
Matt: Ah that's tricky one, um my son loves polar bears at the moment so I'll go for The Arctic.
Holly: Very very nice. I'm sure my family would want me to say in Northern Ireland but I don't think that's quite the same.
Right final one, where would you rather work The Forge or Timber Square? I know it's a cheeky one!
Matt: That's like having to pick your favourite child, I'm not sure I can do that, but I'll go for The Forge because it's ready sooner and I'm keen to get in there.
Holly: Brilliant alright Matt thank you so much for joining the podcast, so it's been really interesting to speak to you thank you for your time.
Matt: Pleasure, thanks a lot.
Holly: Brilliant and so you can listen to more episodes of the podcast Take 10 with Colliers on all the usual places. We've got Apple podcasts, Google podcast, Spotify and YouTube. To find out who our next guest is please follow us on all of our usual social media channels which includes Linkedin, Instagram and Twitter. Thank you all very much for listening.