While some companies are backtracking on sustainability, Mississauga-based real estate company Morguard Corp. (MRC-T) is sticking to its commitments, saying it not only benefits the environment but translates into higher returns.

The developer, manager and owner of a portfolio of approximately 300 properties in North America valued at $14.8 billion, the company has committed to halving its greenhouse gas emissions by 2030 and reaching net-zero by 2050.

“Every dollar that you don’t spend on fuel actually goes to your bottom line,” John Smičiklas, director of environmental, social and governance (ESG) at Morguard, said in an interview with Sustainable Biz Canada.

To that end, the company has invested in efficiency upgrades for its buildings, which reduced waste, energy, carbon emissions and water use. In its 2024 sustainability report, Morguard reports cutting greenhouse gas emissions by 23.1 per cent compared to its 2019 baseline, using 12.1 per cent less energy, consuming 17.2 per cent less water and producing 42 per cent less waste.

After reaffirming its climate target this year, Morguard will continue to examine if it is on track to meeting the goal and where it can intensify efforts, Smičiklas said.

Building resilience with retrofits

Retrofits were a key driver of Morguard’s progress on sustainability, helping to reduce greenhouse gas emissions by 4.4 per cent from 2023 to 2024, for example.

Smičiklas highlighted the award-winning work at the 43, 47 and 49 Thorncliffe Park Dr., apartment towers in Toronto. Morguard undertook HVAC and boiler upgrades, right-sized mechanical systems and installed smart building controls.

The deep retrofits will cut greenhouse gas emissions by 1,400 tonnes per year and generate $1.9 million in operational savings over the next decade, the report states.

“We are taking what we’ve learned there and starting to apply it to more of our portfolio,” Smičiklas said.

For example, Morguard is deepening its engagement with its operational and asset management team to develop a sustainability program. This will help make Morguard a more resilient company, Smičiklas added, as by reducing its costs the company can better bear the fluctuations of the economy.

A sustainability upgrade at the Holt Renfrew Centre in Toronto won the BOMA Crest Award for emission reduction in its category. Heating and cooling systems were optimized to shrink energy use by 15 per cent. A plastic baling machine at the centre helps to simplify recycling for Holt Renfrew.

Overall, Morguard has seen emissions intensity per 1,000 square feet fall from 2.8 tonnes of carbon dioxide equivalent in 2019 to 2.2 tonnes in 2024, a 21 per cent reduction.

Bridging its data gaps

For its next steps, Morguard will analyze if it is on target to meet its climate commitment and understand what will be needed to achieve that goal, Smičiklas said. The company will study its portfolio in detail, as some buildings may need to be put on an aggressive emissions reduction pathway, while others less so.

Collecting a more comprehensive picture of its supply chain emissions known as Scope 3 will be a priority for Morguard. Such information is difficult to acquire because its tenants have full control over the data and Morguard has to make requests to receive it, Smičiklas said.

One way Morguard is addressing this gap is by requiring data sharing in its green leases. Another is implementing shadow meters, which report meter data in real-time, to track the electricity and natural gas consumption of its tenants, rather than requesting utility bills.

“It’s a data collection exercise that we’re trying to find ways to make that much more efficient,” Smičiklas said, “so we’re not waiting for the end of the year and sending a note to a utility and saying, ‘Please give us full building data,' and then we’ll do all our calculations.”

Larger corporate tenants with their own sustainability goals have reached out to Morguard to share their data, he said, citing a memorandum of understanding signed with RBC.

Sustainability is 'actually very good for the bottom line'

Since Smičiklas joined Morguard in November 2023, he has seen the company divert more of its resources to sustainability, unlike some other companies he has witnessed that have retreated on their environmental aspirations.

Generating a return and growing the company will always be central to the business, but that can also be done “by becoming a much more environmentally responsible company,” Smičiklas said, as reducing consumption is “actually very good for the bottom line.”