Rose Companies Portfolio Characteristics

Resilience

As we witness the effects of climate change – increased wildfires, stronger hurricanes, flash flooding-take hold in our country, ensuring the resilience of our portfolio is crucial. As an organization dedicated to providing housing and opportunity for our residents, we strive to build resilience into our business model at all levels. Thanks to our core mission of managing funds with a strong focus on social and environmental impact, we have spent years developing our approach to resilience planning and investment, which reduces risk to our investors and makes our communities stronger. The combined environmental and social focus of our firm enhances our portfolio’s resilience. Energy-efficient buildings are inherently safer in extreme climate conditions and the social cohesion spurred on by resident engagement and social programming creates community bonds that are critical during an emergency. To future-proof our portfolio, we have developed a resilience policy that addresses physical, social and transitional risk across three key stages of asset management and ownership: acquisition, design and operation.

ACQUISITION

During due diligence of investment properties, we undertake a series of assessments and studies to identify and mitigate risk. As we evaluate potential properties for acquisition, we consider the likely risks for a property based on its location, such as flood, earthquake, extreme storms, or tornados. We do not invest in properties with severe, imminent risk, such as those located in a flood-plain. However, some risks are so widespread that they are somewhat unavoidable – such as earthquake risk in California or tornado risk in the Midwest. In these locations, we evaluate building construction type, condition, and structural integrity for resilience against the local risks and will only move forward with properties that are well suited to withstand severe events. In our deal underwriting, we include budget for capital improvements to enhance the resilience of projects.

DESIGN

Understanding and anticipating regulatory risk such as New York’s Local Law 97 or Washington D.C.’s Building Energy Performance Standard, is fundamental to our approach to managing the financial risks associated with a transition to a low-carbon economy. Not only do we design and budget for our buildings to comply with current and anticipated energy, emissions, and sustainability targets, we also incorporate design for the future energy grid to ensure preparedness for a shifting energy market. We continue to design greener and more resilient buildings, in the face of ever-evolving physical risks due to climate change. We incorporate healthy building materials and sustainable practices into our development and operating strategies.

OPERATION

Recognizing the importance of moving away from fossil fuels, we actively take steps toward the electrification of our energy sources and purchase renewable energy credits and carbon offsets in local markets across the country. Through our green commitments and Rose Solar, we reduce the climate impacts of our communities and help make them more resilient in the face of climate change. We integrate management of physical risks into our overall risk management strategy, not just at the asset level through rigorous due diligence, but also at the portfolio level. Recently, we have conducted a portfolio-wide risk assessment of current and future climate hazards for each asset in our portfolio. Working with property and facilities staff and our insurance carriers, we evaluate which risks are most relevant to each property, assess current preparedness, and make recommendations to improve resilience.