Danish pension provider PFA, the country’s second-largest real estate investor with approximately DKK 67bn investments, has joined the climate initiative Reduction Roadmap 2.0.

Reduction Roadmap 2.0 calls for the legal carbon emissions limit for new buildings to be reduced to 5.8 kg CO2e per square meter per year on average from 2025, down from 12 kilos of CO2e per square meter per year.

"At PFA, we support the Paris Agreement and have a goal of reducing CO2 emissions from our Danish properties by 35 per cent by 2025 compared to 2019. But if we are to reach the goal of a greener real estate sector, it is crucial that we have ambitious common rules for CO2 reductions. The initiative from Reduction shows a good way for the construction sector to contribute to meeting the 1.5 degree scenario of the Paris Agreement," PFA head of real estate, Peter Morgan, said.

The engineering company Artelia and the architectural firms CEBRA and EFFEKT are the initiators of Reduction Roadmap 2.0, which targets the construction of new detached houses, apartment buildings and office buildings in Denmark.

"When investors like PFA join with a portfolio of over DKK 60bn, it's clear that construction that aligns with the Paris Agreement is scalable. It's the money that sets the direction, and if the investments move, the industry moves with them. Therefore, we are of course extremely pleased that PFA, together with almost 600 companies, wants to change the legislation so that we can move the industry quickly and together," CEBRA partner and Reduction Roadmap co-founder, Mikkel Schlesinger, said.

For a number of years, PFA has worked with various sustainability initiatives; since 2019, all PFA properties have been certified with DGNB Gold, which is based on the UN's definition of sustainability.

PFA also takes into account the so-called EU taxonomy, which sets a number of requirements for, among other things, climate change mitigation, biodiversity and decent working conditions. In February 2024, PFA was therefore able to announce that properties worth more than DKK 15bn are now classified as sustainable investments according to the EU taxonomy.

"A very large part of Denmark's investment capacity is in the pension sector. This gives us a great responsibility to manage these funds responsibly. At the same time, we firmly believe that sustainable investments in real estate and returns go hand in hand, and we are increasingly seeing that Danes and companies are demanding properties that meet high environmental and climate standards," Morgan added.

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