LA-based climate fund aims to decarbonise property industry

FIFTH WALL, a Los Angeles-based venture-capital firm focused on real estate technology, announced on Thursday (Jul 21) that it has raised US$500 million for a climate fund to help decarbonise an industry estimated to account for nearly 40 per cent of the world’s carbon emissions.

The fund, which brings together some of the world’s largest owners and operators of real estate, will invest in software, hardware, renewable energy, energy storage, smart buildings and carbon-sequestration technologies.

While real estate emits about two-fifths of total global greenhouse gases during a building’s life cycle, estimates show that the industry has invested only US$94.6 million in climate technology research and development (R&D) in the last 10 years, said Fifth Wall.

The cost to retrofit existing US commercial buildings to decarbonise the infrastructure on which they run is estimated at US$18 trillion, said Brendan Wallace, co-founder and managing partner at Fifth Wall.

“This is really the first time the industry, acting collectively, has come together to invest in this critical tech to help decarbonise real estate,” he said. “Real estate is the single biggest lever we can turn on to mitigate climate change.”

Fifth Wall has received commitments from American Homes 4 Rent, Spanish bank Banco Bilbao Vizcaya Argentaria, British Land Co, CBRE Group , Brazil’s Cosan and the New Zealand Superannuation Fund, a sovereign wealth fund, among many others.

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The Climate Fund has already completed strategic investments in several companies, including Assembly OSM, Brimstone, Clarity AI, Electric Hydrogen, Icon, Sealed, Span, Turntide Technologies and Wildcat Discovery Technologies, Fifth Wall said.

The climate fund will bring Fifth Wall’s capital-under-management to about US$3.2 billion.

“The real estate industry is the single most contributed industry to climate change,” Wallace said. “It’s the culprit that was hiding in plain sight.” REUTERS