ESR Cayman ESG Report 2021

PILLAR 2 PROPERTY PORTFOLIO Environmental considerations are integrated into the Group’s properties during their design, construction and maintenance which cover the daily operations of these assets. We strive to continuously improve our properties by working closely with our customers, investors, contractors and local authorities throughout the entire process. When selecting sites for our development, a number of factors are considered including avoiding environmentally sensitive areas to limit adverse effects on wildlife and ecosystems, enhancing the connectivity of people and accessibility to the area and remediating actions of brownfield sites. Property design is another crucial step as we emphasise on the use of sustainable materials and resource-efficient innovative technologies to ensure that resilient and sustainable assets are built. Where applicable, we take advantage of the elements of the surrounding environment such as utilising natural ventilation and solar energy in particularly sunny regions to power our properties. During construction, we have implemented erosion and sediment control as well as responsible waste management to minimise the environmental impact. All of the assets in our portfolio have been developed in accordance with the applicable governing codes and construction standards. We have established an ESR Future Solutions Group (FSG) to perform indepth analysis on improving our assets and undertake sustainable asset enhancement initiatives. We have established five key areas in developing our diverse property portfolio to better meet the expectations of our various stakeholders and to adhere to regulations set out by governments in the markets which we operate in. The five focus areas that will be further detailed in this section of the report are as follows: • Sustainable & Efficient Operations • Sustainable Building Certifications • Climate Change Resilience • Flexible & Adaptable Properties • Strategic Locations Focus Areas 2025 Targets Status Sustainable & Efficient Operations 50% increase in solar power generation capacity We must add about 3.5MW on average each year over the next five years in order to exceed 52MW of solar power generation capacity (a 50% increase) by 2025. We were able to achieve our annual goal at the end of 2021, as the total installed rooftop solar capacity across all markets was 39.4MW, an increase of 4.4MW. 20% reduction in energy consumption intensity During the past year, several assets were selected to undergo asset enhancement initiatives in consideration to improve energy intensity. In addition, the Group began the study of a decarbonisation plan which will provide the long-term path to achieve further reduction measures. Sustainable Building Certifications 50% of our portfolio to obtain Sustainable Building Certifications 20% of GFA completed in 2021 has been either certified by recognised sustainable building standards or the certification process is underway. The details of all green certifications obtained in 2021 can be found in the ESG data summary. Climate Change Resilience Alignment with Recommendations from the Taskforce on Climate-related Financial Disclosures (TCFD) MSCI’s Real Estate VaR has been utilised by ESR in identifying climate related risks and opportunities by measuring current and future costs of climate change and the global warming impact on the asset portfolio. The asset management process will strategically be adapted to address the risks most relevant to ESR. Flexible & Adaptable Properties Design, construction and maintenance approaches to reduce material degradation ESR has continued to design and build properties with accessibility and adaptability in mind. Included in our assets is the Bucheon Logistics Park under our South Korea portfolio that has excellent connectivity to Greater Seoul and major transport infrastructures as well as state-of-the-art design and employee amenity roof space. For our Japan assets, we have the ESR Yokohama Sachiura Distribution Centre 1 located in Yokohama City with relaxing lounges, retail shops, sky decks and children’s day care centres known as BARNKLÜBBS provided to our tenants. Strategic Locations Building and expanding modern logistics facilities in key locations For each of these focus areas, we have created environmental targets that align with our commitments and actions of our operations to achieve a green and sustainable future. The table below illustrates the goals that are expected to be attained by 2025. ENVIRONMENTAL, SOCIAL AND GOVERNANCE REPORT 2021 23 PILLAR 2: PROPERTY PORTFOLIO