Vicinity Centres (ASX:VCX) is in the process of becoming the largest investor in solar power of any shopping centre group in Australia.
It will invest $28m over the next 12 months across its SA and WA assets via the installation of 39,000 solar panels that will generate 17.4 GWh of energy each year. The energy generated by the solar and battery systems will be used on-site for both Vicinity and retailers reducing reliance on the grid. The project is a good example of how financial returns and sustainability objectives can work in unison. We expect Vicinity to achieve mid teens IRR on investment from its solar energy programme.
In recent discussions with management, it is clear the company is looking for energy related initiatives that benefit as many stakeholder groups as possible. At the same time as shareholders being financial winners from the initiative, in a win for the environment Vicinity is reducing overall energy usage. From FY15 to FY17 the total portfolio gross lettable area (GLA) reduced by 4.6% while the total energy usage of the portfolio has reduced by 14.4% over the same time period. Vicinity is within the investment universe of the Ethical Partners Australian Share Fund.
During December 2020 the Fund returned 2.11% versus the S&P/ASX 300 Accumulation Index of 1.32%, outperforming the market by 0.79% (after fees). Overweight positions in Renewable Energy and Transition Commodities and an underweight position in Healthcare contributed to relative performance while an overweight position in Food Products and an underweight position in Information Technology detracted from relative performance.
Ethical Partners has made a submission to to the inquiry on the Climate Change Bill. In our view it is clear that we desperately need whole of government support around the important elements of this bill.
Biodiversity is a very important area of engagement for us at EPFM, and an area of increasing interest for investors. Experts believe that we are in the midst of the Earth’s sixth mass extinction event -some 75 per cent of terrestrial and 66 per cent of marine environments have already been severely altered by human activity and one million species face extinction – many within decades.
During October 2020 the Fund returned 2.85% versus the S&P/ASX 300 Accumulation Index of 1.89%, outperforming the market by 0.96% (after fees). Overweight positions in Insurance stocks and an underweight position in Metals & Mining contributed to relative performance while overweight positions in Consumer Staples and Media & Entertainment detracted from relative performance.