New CWR Report! Top 4 HK developers ill-prepared for climate risks! “No sense climate strategies” today exposes tycoons to material write downs
by CWR 24 February, 2025
Hong Kong, 24th February 2025 – CWR releases a new report: “No Sense Climate Strategies! Top 4 HK real estate listco’s unprepared & highly exposed to imminent coastal threats” pointing to material write downs for tycoons with significant stakes in listed companies with assets worth over HK$2.3trillion (US$295billon).
The report warns that climate resilience measures disclosed by these companies are not commensurate to escalating risks ahead – adaptation plans disclosed do not even address the respective risks identified by the companies, let alone CWR’s stress test results which reveal that 37-56% of their properties could be at risk from “unlucky” storm tides today. Find out which top real estate listco:
- Best matched CWR’s stress test results – but did not disclose adaptation plans to protect identified assets at risks;
- Is most maligned – it’s “best on paper” with most board buy-in but let down by stress test quality = massive risk gaps;
- Is the clear laggard – no net zero strategy + worst grasp of risks;
- Omitted stress tests for chronic risks – despite 1/3rd of its portfolio on track to be permanently submerged by 2100 if emissions continue; and
- Has properties under development that are more at risk than existing properties = ignoring rising risks.
“The HSPDMI 4’s climate strategies and our own stress tests of 900+ assets in Hong Kong and the Mainland revealed stark gaps on multiple fronts – only one company’s disclosed physical risk levels matched our stress test results…” said Dharisha Mirando, CWR’s Finance Lead and author of the report.
The report is a wake up call given the upcoming development of the low-lying Northern Metropolis + it’s also timely given imminent mandatory disclosure of transition & physical risks under the ISSB standards. CWR’s findings have clear implications for financial regulators as well as the government. So check out the recommendations for companies, finance, regulators & government – start building resilience with this report now!
Check out the Full Report, Executive Summary & Press Release.
For quick access:
- HSPDMI 4’s Climate Pledges, Stress Tests & Adaptation Strategies: at-a-glance timelines, scenarios, risks, assets analysed & stress test results
- HSPDMI 4’s Own Stress Tests… see what they say is at risk
- CWR’s Stress Test Results for the HSPDMI 4… see summary For detailed results – see factsheets below)
- Plus don’t miss out on the 3-page Factsheets for the HSPDMI 4:
- See why HKSAR government adaptation efforts disclosed so far leave HK assets at risk
- Face reality – see what accelerated heating means for storm tides & SLR
- CWR stress test methodology: SLR & storm tide
- Higher premiums & valuation write-downs: why the HSPDMI 4’s could face higher costs from no-sense climate strategies
- HSPDMI 4’s adaptation plans… see summary
- HSPDMI 4’s Carbon Related Disclosure: at-a-glance emissions, electricity, pledges, carbon management, ESG + see which Scope 3 categories are disclosed
| “Property prices are down and the economic outlook remains poor due to contentious geopolitics, but with the US out of the Paris Agreement again, global warming and climate risks will likely accelerate.” “So, 1) accept that impacts today are already tracking IPCC worst-case projections so update stress tests for real risks ahead; 2) adapt, adapt, adapt and collaborate; and 3) up carbon pledges plus meet them sooner to “slow down” risks like SLR & storm tides. Climate change waits for no one – we need sensible climate defence strategies now to preserve value.” Dharisha Mirando, CWR’s Finance Lead & lead author | “The stakes are high – up to 18% of a single developer’s assets are on track to be permanently submerged by 1m of SLR (sea level rise) which scientists now say can occur by 2070 if emissions continue. A recent Singapore study also points to 1.9m of SLR by 2100 – this means we’re now likely tracking the IPCC’s “cannot be ruled out” scenario of 2m SLR by 2100. As regional disparities in SLR mean we may see these levels earlier, we must start preparing now” “With rising climate risks, investors will increasingly rely on climate disclosures so regulators must set better guidelines to standardise stress testing to ensure they are comparable and credible.” Debra Tan, Director & Head of CWR |
HSPDMI 4 Factsheets:
CKAH HLD NWD SHKP
Contains at-a-glance overviews of the listco’s own transition pledges + key energy & emissions data; physical risk stress test results; adaptation strategies disclosed & financials + CWR analysis of board focus on climate risks: AR vs. sustainability reports; CWR stress tests of multiple scenarios; risk exposure of properties in HK & Mainland; risk exposure of existing properties vs. under development: