Climate-related Disclosures 2023

NZX and media
announcement
—
5 April 2024

Page 1

CLIMATE-RELATED DISCLOSURES 2023
Property for Industry Limited (PFI) today releases its Climate-related Disclosures for the reporting period
ended 31 December 2023.

PFI’s 2023 Climate-related Disclosures are available on PFI’s website at:
https://www.propertyforindustry.co.nz/sustainability/

ENDS


























ABOUT PFI & CONTACT

PFI is an NZX listed property vehicle specialising in industrial property. PFI’s nationwide portfolio of 93 properties is leased to
around 126 tenants.

For further information please contact:

SIMON WOODHAMS
Chief Executive Officer
----
Phone: +64 21 749 770
Email: woodhams@pfi.co.nz
CRAIG PEIRCE
Chief Finance and Operating Officer
----
Phone: +64 21 248 6301
Email: peirce@pfi.co.nz
----
Property for Industry Limited
Level 4, Hayman Kronfeld Building, 15 Galway Street,
Auckland 1010
PO Box 1147, Shortland Street, Auckland 1140
www.propertyforindustry.co.nz

---

Climate
Related
Disclosures
YOUR
INDUSTRIAL PROPERTY
EXPERTS
PROPERTY FOR INDUSTRY LIMITED
20
23

1
SECTIONS
CONTENTS
INTRODUCTION
STATEMENT OF
COMPLIANCE
GOVERNANCE
STRATEGY
RISK MANAGEMENT
METRICS AND
TARGETS
APPENDIX
CLIMATE RELATED DISCLOSURES
2
3
03
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05
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06
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09
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5
6
7
21
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PFI
CLIMATE RELATED DISCLOSURES 2023

INTRODUCTION
PROPERTIES
92
CONTRACT
RENT
CURRENT
VALUATION
2.028
$
$
BN
5.
WEIGHTED
AVERAGE
LEASE TERM
(WALT)
YEARS
TENANTS
126
96.
Property for Industry Limited is an NZX listed
property vehicle focused on the industrial sector.
We first listed in 1994. Thirty years on, we have
around 5,000 shareholders and a portfolio of 92
properties valued at over $2.0 billion dollars as
at 31 December 2023. PFI’s properties are located
throughout New Zealand, but primarily in Auckland.
These Climate-related Disclosures are for Property
for Industry (the Company) and its subsidiary P.F.I.
No. 1 Limited (PFI No. 1) (together, the Group, PFI
or we). This report covers our last 12 months of
activity from 1 January 2023 to 31 December 2023,
unless otherwise stated. All financial information
in this report is presented in New Zealand Dollars
and excludes GST.
03
AUCKLAND OUT OF AUCKLAND
85
%
15
%
6M06
Figures on this page
are as at 31/12/23.

PFI’s approach to sustainability
should enable us to mitigate some risks
and capitalise on some opportunities for
long term value creation.
PFI recognises that we need to
proactively manage the risks and
opportunities that arise from climate
change, just as we manage other risks
and opportunities facing our business.
Since 2020, PFI has prepared voluntary
climate-related disclosures aligning
with the recommendations of the Task
Force on Climate-related Financial
Disclosures (TCFD). During that time,
we have built a solid understanding of the
climate-related risks and opportunities
faced by the business and applied
this understanding to PFI’s strategy.
Further details on our current business
model can be found on pages 6-9 of
our 2023 Annual Report.
This year, PFI is pleased to release
our first mandatory climate-related
disclosures in accordance with the
Aotearoa New Zealand Climate
Standards and to share the progress
we have made in advancing our
understanding of, and response to, our
climate-related risks and opportunities.
PFI was created on the belief that
investing in quality industrial property
in prime locations has the potential to
deliver attractive shareholder returns.
In terms of our impact on people and
the planet, we understand that meeting
our ambitions requires long-term
commitment, long-term thinking, and
no shortage of hard work. We believe
PFI’s response to climate-related risks
and opportunities will span over many
years, and we need to be flexible and
reassess our approach as the climate
change pathway becomes clearer.
INTRODUCTION CONTINUED
Disclaimer
Climate change is an evolving challenge,
with high levels of uncertainty. This report
sets out PFI’s approach to scenario analysis,
our understanding of, and response to, PFI’s
climate-related risks and opportunities,
and our current and anticipated impacts
of climate change. This reflects our current
understanding as at 5 April 2024.
We acknowledge that this will evolve over
time, and this report contains estimates and
assumptions about future external physical
and transitional changes driven by climate
change and their anticipated impacts on our
business. These representations are subject
to significant uncertainties and assumptions.
This report contains forward looking
statements, including climate related
scenarios, targets, assumptions, climate
projections, forecasts, statements of PFI’s
future intentions, estimates and judgements.
These statements involve assumptions,
forecasts and projections about PFI’s present
and future strategies and the environment
in which PFI will operate in the future, which
are inherently uncertain and subject to
limitations, particularly as to inputs, available
data and information which is likely to
change. The risks and opportunities
described here, and our strategies to achieve
our targets, may not eventuate or may be
more or less significant than anticipated.
There are many factors that could cause
PFI’s actual results, performance or
achievement of climate-related metrics
(including targets) to differ materially from
that described, including economic and
technological viability, as well as climatic,
government, consumer, and market factors
outside of PFI’s control. PFI has used its best
efforts to provide a reasonable basis for
forward-looking statements and is
committed to progressing our response to
climate-related risks and opportunities over
time but is constrained by the novel and
developing nature of this subject matter.
We remain committed to progressing
our response to climate-related risks
and opportunities over time, and to report
our progress each year, but we caution
reliance on aspects of this report that
are necessarily less reliable than other
aspects of our annual reporting.
Nothing in this report should be
interpreted as capital growth, earnings
or any other legal, financial, tax or other
advice or guidance.
In early 2023, we shared our refreshed
sustainability strategy (on page 9). Our
progress against this strategy is set out on
pages 19-27 of our 2023 Annual Report. n
04
PFI seeks to benefit
our investors,
tenants, and industry,
and part of this
involves working
towards ensuring our
strategy is resilient
to climate-related
risks.”
SIMON WOODHAMS
Chief Executive Officer

PFI is a climate-reporting entity
under the Financial Markets
Conduct Act 2013. These
climate-related disclosures
comply with the Aotearoa
New Zealand Climate
Standards (NZ CS 1, 2 and 3)
issued by the External
Reporting Board (XRB).
STATEMENT OF COMPLIANCE
(1) Disclosed selected GHG emissions include purchased goods and services, capital goods, energy and fuel, waste generated in operations, business travel, and employee commuting (Categories 1,2,3,5,6,
and 7 respectively), and exclude Category 13 emissions (downstream leased assets) relating to electricity consumed by PFI’s tenanted buildings.
In preparing this report, PFI has elected
to use the following adoption provisions
in NZ CS 2:
§
Adoption provisions 1 and 2, which
exempt PFI from disclosing current
and anticipated climate-related
financial impacts on PFI.
§
Adoption provision 3, which exempts
PFI from disclosing information
on the transition planning aspects
of our strategy, noting that we have
included a description of our progress
towards developing the transition
plan aspects of our strategy.
§
Adoption provisions 4 and 5, which
exempt PFI from disclosing Scope
3 greenhouse gas (GHG) emissions
and comparatives for Scope 3 GHG
emissions. We have disclosed selected
Scope 3 GHG emissions
1
only for the
FY23 reporting period.
§
Adoption provisions 6 and 7, which
exempt PFI from disclosing two
years of comparative information
for metrics and an analysis of trends
evident from this comparison.
We are working towards quantifying our
current and anticipated financial impacts
as our understanding of our climate-
related risks and opportunities improves
and plan to measure and track our
performance against climate-related
metrics and targets over time. n
_ 30-32 Bowden Road,
Mount Wellington,
January 2024.
05

GOVERNANCE
This section describes the role
of PFI’s Board in overseeing
climate-related risks and
opportunities and the role of
management in assessing and
managing climate-related risks
and opportunities.
Board of Directors
Oversees PFI’s strategy and performance, including PFI’s Sustainability Strategy.
Establishes a framework for recognising and managing all business risks, including climate-related risks.
Oversees, reviews and approves PFI’s Climate-related Disclosures.
Board Audit & Risk Committee
Assists the Board with risk management, including climate-related risks.
Annually reviews PFI’s company-wide risk register and climate-related risks and opportunities.
Reviews and provides recommendations to the Board on PFI’s Climate-related Disclosures.
Senior Leadership Team
Comprising of PFI’s Chief Executive Officer, Chief Finance and Operating Officer,
Head of Sustainability and Operations, and Portfolio Manager
Leads PFI’s Sustainability Strategy and the day-to-day management of PFI’s climate-related risks and opportunities.
Meets frequently and monitors progress against PFI’s strategy and targets.
Reports PFI’s progress and response to climate-related risks and opportunities to the Board quarterly.
Head of Sustainability and Operations
Leads the assessment of PFI’s climate-related risks and opportunities.
Aims to ensure PFI’s strategy is designed to respond to climate-related risks and opportunities.
Reports progress on climate-related matters to the Senior Leadership Team.
Leads the preparation of PFI’s Climate-related Disclosures.
Management Sustainability Meetings
Meets regularly to discuss execution of PFI’s Sustainability Strategy and performance against targets.
Attended by key members of the PFI team who manage the day-to-day operations and play a critical role in implementing
PFI’s Sustainability Strategy and targets.
Reports progress to the Senior Leadership Team (via the Head of Sustainability and Operations).
06

Governance Body Oversight
PFI’s Board of Directors is responsible
for oversight of climate-related risks and
opportunities affecting PFI. The Board
oversees PFI’s overall performance,
as well as its Sustainability Strategy
and management of climate-related
matters. The Board is also responsible
for recognising and managing all
business risks and ensuring effective
risk management systems are in place
to protect PFI’s assets, including for
climate-related risks, supported by the
Audit and Risk Committee.
PFI’s identified climate-related risks and
opportunities are reviewed and presented
to the Audit and Risk Committee and
Board annually. The Audit and Risk
Committee and the Board review PFI’s
Risk Register annually, which provides a
view of the Company’s overall business
risks and climate-related risks. Climate-
related risks are embedded in several
of PFI’s risks, including our strategic,
regulatory, property and Environmental,
Social and Governance (ESG) risks.
PFI’s Audit and Risk Committee is
responsible for ensuring appropriate
metrics and targets for managing PFI’s
climate-related risks and opportunities
are set and monitored in consultation
with the Board and management.
During 2022, the Senior Leadership
Team refreshed PFI’s Sustainability
Strategy, which included PFI’s key targets
and initiatives for managing climate-
related risks and opportunities. These
key targets and initiatives have been
endorsed by the Board. During 2023, the
Board monitored progress against agreed
targets at quarterly Board meetings. The
Board also oversees the achievement
of sustainability-related targets
incorporated in the Senior Leadership
Team’s short-term incentives, including
progress towards the delivery of 5 Green
Star certification
2
for new developments.
Management also developed metrics to
measure and manage climate-related
risks and opportunities, which were then
endorsed by the Board at the December
2023 Board meeting. It is intended
that the Board will monitor progress
against these metrics and targets at least
annually at Board meetings from 2024.
Further details are set out in the Metrics
and Targets section.
PFI’s Board also considers climate-
related risks and opportunities
when reviewing and overseeing
implementation of PFI’s overall strategy,
plans and budgets. Management of
climate-related risks and opportunities
associated with our existing portfolio
is a key strategic consideration for PFI.
Key strategic choices for PFI include
targeting a minimum 5 Green Star
certification for all significant new
buildings, aiming to improve operational
performance and sustainability of
(2) Green Star ratings are administered by the New Zealand
Green Building Council (NZGBC), a network of property and
building businesses aiming to normalise market-based green
practices. PFI is a member of the NZGBC.
existing buildings, and embedding
climate resilience across PFI’s portfolio.
The Board also considers climate-related
risks and sustainability matters as part of
PFI’s due diligence for new acquisitions
and in decisions to divest properties.
PFI's Board of Directors - April 2024
07
GOVERNANCE CONTINUED
CAROLYN STEELE
Independent Director
DAVID THOMSON
Independent Director
DEAN BRACEWELL
Independent Director
JEREMY SIMPSON
Independent Director
ANTHONY BEVERLEY
Independent Director
ANGELA BULL
Independent Director

PFI’s Board strives to ensure that the
Board maintains the right mix of skills
and competencies to effectively deal
with current and emerging issues of
the business, including climate-related
risks and opportunities as appropriate.
PFI’s Directors review the Board’s skills
and competencies annually, which
includes a self-assessment of their
skills and experience across a range of
topics, including climate-related skills
(comprising of sustainability, ESG and
climate change). Refer to the Director
Skills Matrix on page 77 of our Annual
Report , for a summary of the skills and
experience represented on our Board.
During 2023, PFI’s Board undertook
training on climate-related disclosures
to develop and maintain their skills and
knowledge in this area.
A summary of key Board engagements
relating to climate-related risks and
opportunities during 2023 can be found
in Appendix 1.
Management’s Role
PFI’s Chief Executive Officer and Chief
Finance and Operating Officer are
responsible for managing risks and
executing PFI’s overall strategy, including
climate-related risks and opportunities.
With contribution from the Senior
Leadership Team (including the Chief
Executive Officer and Chief Finance and
Operating Officer), PFI’s Head of
Sustainability and Operations leads the
identification, assessment, and
management of PFI’s climate-related
risks and opportunities and aims to
ensure that the Company’s strategy is
designed to respond to these risks and
opportunities. Under PFI’s Risk
Management Framework, which is
approved by the Board, the Senior
Leadership Team are responsible for
promoting good risk practices by their
teams. Further details of how PFI
identifies, assesses, and manages climate-
related risks are set out in the Risk
Management Section.
During 2023, PFI held regular
sustainability meetings with the Head of
Sustainability and Operations and key
team members who manage the day-to-
day operations of the business and play a
critical role in implementing PFI’s
Sustainability Strategy and key targets.
The purpose of these meetings is to
monitor and track progress on key targets
and manage climate-related risks and
opportunities. Sustainability and climate
risk is also a frequent topic at fortnightly
Senior Leadership Team meetings, where
management discuss emerging climate-
related market trends, progress against
PFI’s key targets, strategy, climate risk
and transition planning. Management
decisions on PFI’s responses to climate-
related risks and opportunities were
made through this forum. The Senior
Leadership Team engage with PFI’s
Board and Audit and Risk Committee on
climate-related risks and opportunities
and progress against targets and
responses to climate-related risks via
reporting at Audit and Risk Committee
Meetings and quarterly Board meetings.
Further information on PFI’s responses
to climate-related risks and opportunities
can be found in the Strategy section. n
_ Focusing on
projects with
value creating
opportunities.
08
GOVERNACE CONTINUED

STRATEGY
This section describes the
scenario analysis PFI has
undertaken, the climate-
related risks and opportunities
we have identified in our
work to date, our current and
anticipated impacts of climate
change, and how we plan to
position our business towards
a low-emissions, climate-
resilient future.
PFI's Strategy
PFI’s sustainability strategy was
refreshed in 2022. PFI has been
assessing its climate-related risks
and opportunities since 2020, and
the refreshed strategy considered the
outcomes of these previous assessments.
The strategy is described here:
Significant new buildings to target minimum
5 Green Star certification.
PFI also aims to minimise and offset residual Scope 1 + 2 greenhouse gas emissions.
Install solar systems
at five buildings by the end of 2025.
Implement power metering and monitoring for
50% of properties by the end of 2025.
SOLAR SYSTEMSMETERINGGREEN STAR
GREENHOUSE GAS
EMISSIONS
RESOURCES
AND WASTE
DISASTER AND
CLIMATE RESILIENCE
PEOPLE AND
WELLBEING
ECONOMIC
VALUE
IMMEDIATE TARGETS
MATERIAL FOCUS
AREAS TO 2030
CORE

PRINCIPLES
Create a future-proofed and resilient portfolio through sustainable refurbishments, developments, acquisitions and divestments.
Maximise the useful lifespan of buildings to minimise waste by transforming our core portfolio.
Become a trusted partner for tenants when it comes to sustainability and reducing greenhouse gas emissions.
Collaborate with supply chain partners to minimise waste, use lower-impact materials and promote positive social impacts.
Maintain strong employee engagement and health and safety performance.
Maintain high standards of financial and governance performance.
Our Sustainability Strategy: 2030
We have committed to a range of projects and targets through to 2025 to operationalise this strategy. Key targets include:
DYNAMIC

IMPLEMENTATION
Our implementation of the strategy will be dynamic.
We will continuously review and adapt our response as we learn and as our external environment changes.
09
Aspiration
The embodied and
operational greenhouse gas
emissions associated with
PFI’s buildings
are minimised.
Aspiration
The impacts from the
materials that PFI uses and
the waste PFI produces
during developments
and refurbishments
are minimised.
Aspiration
PFI’s buildings are resilient
and we are well placed to
respond to disasters.
Aspiration
Our people are safe
and engaged, and we
promote positive social
impacts through
our operations.
Aspiration
The value of PFI
grows to create economic
value for investors,
tenants, our people and
others that we work with.

Scenario analysis
In 2023, PFI undertook scenario analysis
to review PFI’s previously identified
climate-related risks and opportunities
and assess our strategic resilience across
three climate scenarios. Climate-related
scenarios represent a plausible and
challenging description of how the future
may develop based on assumptions
about potential climate-related impacts.
Climate-related scenarios are not
intended to be probabilistic or predictive,
or to identify the ‘most likely’ outcomes
of climate change. Climate scenarios are
intended to help entities develop their
the scenario analysis process included
the full supply chain, comprising of
tenants, suppliers, contractors, investors
and funders. Our scenario analysis
considered a 1.5°C ‘Orderly’ scenario, a
less than 2°C ‘Disorderly’ scenario, and
a greater than 3°C ‘Hot House World’
scenario.
4
A description of each scenario

is outlined on pages 11-13, with a detailed
description, methods, assumptions, and
sources of data used to construct each
scenario available on NZGBC’s website:
www.nzgbc.org.nz/research-and-reports.
We consider the sector scenarios to be
relevant to PFI, as many entities within
the property and construction industry
will face the same challenges resulting
from climate change. These scenarios
have helped us to consider the resilience
of our business and strategy to climate-
related risks and opportunities faced
by PFI and our sector generally. PFI’s
climate-related risks and opportunities
were assessed against these scenarios
by the Senior Leadership Team and
reviewed by the Board. PFI’s scenario
analysis forms part of PFI’s climate
risk and opportunity assessment,
which in turn is used to inform PFI’s
Company’s strategy.
internal capacity to better understand
and prepare for the uncertain future
impacts of climate change.
PFI’s scenario analysis process involved
using the climate scenarios constructed
by the New Zealand Green Building
Council (NZGBC) and Beca Limited
(Beca) for the property and construction
sector in 2023.
3
Along with other key
stakeholders within the industry, we
are pleased to have been involved in
overseeing the development of these
sector scenarios as part of the Technical
Working Group created by NZGBC in
2022. The scope of operations covered in
(3) Beca Limited, Climate Scenarios for the Construction and
Property Sector, Ngā Horopaki Āhuarangi mō te Rāngai
Hanganga me ngā Whare, New Zealand Green Building
Council (2023)
(4) When reviewing the sector scenarios, PFI has assessed
transition risk in a Hot House World scenario to be higher
than anticipated by NZGBC and Beca. PFI has particularly
focused on the impacts of extreme physical climate risks
(extreme weather events, rainfall and flooding) driving
increased demand for climate-resilient buildings among
tenants, investors, funders and insurers.
Climate change is a fundamental shift over the longer term in our external environment
that requires decisions to be made now with the implications spanning several years.
PFI’s scenario analysis, climate-related risks and opportunities, targets and current and
anticipated impacts considered short-term, medium-term and long-term time horizons
that align with PFI’s strategic planning. These time horizons are set out below:
HORIZONPERIODDESCRIPTION
Short termPresent - 2030Within PFI’s weighted average lease term (WALT) (1-6 years)
Medium term2031 - 2050The period in which PFI anticipates spending major CAPEX at
most properties (6-25 years)
Long term2051 - 2100The life of a building (25+ years)
10
STRATEGY CONTINUED
These scenarios
have helped us
to consider the
resilience of our
business and
strategy to
climate-related
risks and
opportunities faced
by PFI and our
sector generally.”

SECTOR SCENARIOS
Decarbonisation policies
are enacted immediately
and smoothly (globally, in
New Zealand, and within the
sector). The world successfully
limits global warming to
1.5°C above pre-industrial
temperatures. This scenario
presents medium to high
transition risk for PFI due
to a greater focus on
decarbonisation.
Global emissions decline steadily to
achieve net zero CO
2
emissions globally
by 2050. New Zealand climate policies
are ambitious and in line with the
rest of the world’s, with the building
and construction sector adopting and
prioritising decarbonisation policies.
The energy grid shifts rapidly away from
fossil fuel use, with the New Zealand
grid reaching 100% renewable by 2050.
Alternative fuels are used as a backup,
and renewables are utilised onsite
instead of fossil fuels.
Direct carbon capture technology
matures to a point where the world is on
track to achieve net zero CO
2
emissions
globally by 2050.
New Zealand’s Emissions Trading
Scheme (ETS) is amended to make
carbon capture and storage (CCS) a
recognised removal activity. Carbon
capture and storage systems are
implemented in the medium term to
accelerate the rate of decarbonisation
and mitigate hard-to-abate fossil fuel use.
The implementation of this technology
increases pressure on technical and
skilled labour supply. As this technology
matures there is a reduction in focus
on hard-to-abate emissions associated
with some construction materials
(e.g. concrete, steel, aluminium).
This unlocks capital for more cost-
effective decarbonisation strategies.
The shadow price of carbon increases
dramatically to align with a 1.5°C
trajectory, steadily rising up to
$250/tCO
2
e by 2050 (an increase
of ~614% from a 2023 baseline of
$35/tCO
2
e). As a result, the cost and
lead-times for low carbon materials
and products increase through the 2020s
and 2030s, but they become more cost
and time effective than traditional
materials by 2040. The construction
sector grows significantly as carbon-
supporting infrastructure is replaced
with greener, low carbon infrastructure.
Land use change due to increased
forestry sequestration continues through
to 2050 but the extent is limited and has
marginal impacts on food production
and biodiversity.
Regulatory changes for the property and
construction sector include government
procurement policies targeting recycled
materials and circular economy
principles. Stringent energy and carbon
caps for new buildings are phased in
rapidly. Existing buildings must disclose
energy and carbon performance,
take steps to remove all reliance on
fossil fuels for operation, and scale up
energy efficiency.
Pressures on centralised infrastructure
increase with the demand for
electrification, closing of fossil fuel
power stations and direct climate
impacts on storm and wastewater
networks. Modular, circular designs
will take precedence, with existing
building re-use and adaptive re-use
being in demand rather than new builds.
Rapid densification puts pressure on
horizontal infrastructure, necessitating
significant upgrades.
Significant behavioural change results in
an increased demand for energy efficient
buildings, increased pressures on public
transport, the rise of circular business
models and a higher consumer awareness
regarding low carbon buildings.
In response to continued high intensity
rainfall events, properties in floodplains,
or subject to unstable ground conditions,
experience increasing insurance
premiums above inflation and experience
insurance retreat by 2050. The threat
of late century sea level rise is being
priced into property valuations in the
short term and premiums on some
coastal properties increase to the point
of permanent unprofitability, leading to
them being stranded.
1.5°C
Orderly
scenario:
11

SECTOR SCENARIOS
Significant decarbonisation
is delayed until 2030 (globally,
in New Zealand, and within
the sector). Global warming
is limited to <2°C by 2100.
The sector faces high transition
risk after 2030 as entities rush
to decarbonise.
As global emissions continue to rise
during the 2020s, concerns about
meeting Paris Agreement Goals drives a
sudden shift in global policy around 2030.
Abrupt and stringent decarbonisation
policies are enacted in the 2030s,
succeeding in limiting global warming
to below 2°C above pre-industrial levels
by 2100.
New Zealand follows suit with the rest
of the world, leading to abrupt policy
and market changes for the property and
construction sector post-2030. There
is no initial increase in carbon price up
to 2030, at which point price rapidly
increases to reach $250/tCO
2
e by 2050.
Whilst rapid policy, technology, and
behaviour change does occur, it is
disordered and inconsistent across
sectors and sub-sectors.
Land change due to increased forestry
sequestration takes place out to 2050
and there are moderate impacts on food
production and biodiversity as rapid
decarbonisation efforts significantly
expand the extent of managed forests.
During the 2020s there is a slow increase
in demand for electricity, followed
by a surge in demand in the 2030s as
New Zealand rushes to electrify our
transport networks. The electricity
sector is unprepared for the sudden
shift in demand at 2030, which causes
a delay in adequate expansion of the grid
during the 2030s and leads to supply
constraints. These constraints result in
more frequent blackouts and fluctuations
in electricity prices.
During the 2020s, increased
regulation within the sector attempts
to address the need to decarbonise,
but regulation is uneven across local
entities and conflicting regulations
lead to uncertainty.
At 2030 more stringent regulatory
changes are introduced. During
the 2020s there is less investment
signalling for both new and retrofit low
carbon buildings, which causes further
uncertainty and lack of momentum until
2030. At 2030, significant regulatory
changes demand an immediate
step change in building energy and
carbon requirements.
Limited investment during the
2020s means the spike in demand
for low carbon materials, low energy
technology and onsite generation in
2030 causes significant disruption for
the sector. Competition for availability
of products, materials, professional
advice and competent installers impacts
significantly on both new building and
retrofit projects resulting in escalation in
development costs.
Pressures on centralised infrastructure
are compounded after 2030 due to
increasing densification and the
increasing impacts of physical climate
risks. Spatial planning to prioritise
decarbonisation and densification
versus climate resilience and managed
retreat is inconsistent across the country.
This inconsistency leads to increasing
uncertainty for the construction and
property sector regarding which assets
are most likely to become stranded.
Initially the construction and property
sector is slow to decarbonise, but ‘fast
movers’ get the opportunity to utilise
materials, capital, and knowledge while
late movers are disadvantaged when
demands peak post-2030.
A lack of action in addressing medium
term physical risks in the 2020s results
in a greater extent of vulnerable assets
in the medium term (2030-2050). The
pace of insurance retreat is accelerating.
Properties in floodplains experience
increasing insurance premiums above
inflation and experience insurance
retreat by 2040. Premiums on some
coastal commercial properties increase
to the point of permanent unprofitability,
leading to them being stranded by 2030.
<2°C
Disorderly
scenario:
12

SECTOR SCENARIOS
No further decarbonisation
policies are enacted (globally,
in New Zealand, and within the
sector), and emissions continue
to rise. Global warming reaches
>3°C above pre-industrial levels
by 2100. The sector faces
extreme physical climate risks,
particularly towards the end
of the century.
PFI expects transition risks will continue
as a consequence of the extreme physical
impacts of climate change, particularly
as adaptation and climate-resilience
are prioritised.
New Zealand’s climate change policy
remains in keeping with the rest of the
world. No further policies are introduced
to curb emissions, with the building
and construction sector following suit.
Regulatory changes are slow and focus
on adaptation and managing climate
driven immigration / refugees. The price
of carbon remains at $35/ tCO
2
e to 2050.
Mandates are introduced to conserve
energy for critical functions, as asset and
infrastructure damages due to climate
change are realised.
New Zealand follows global trends in not
introducing additional policies and both
technology and behaviour change remain
slow across all sectors.
Increasing frequency and severity
of acute weather events, as well as
longer term increases in baseline shifts
(increasing temperatures and sea level
rise), drive an increasing need for climate
adaptation. For example, the need to
retrofit buildings and infrastructure to
be more heat and flood resilient. There
is little investment in technology and
innovation that does not serve these
pressing adaptation needs. This increases
our reliance on current extractive
technologies, which become more
expensive as material resources become
scarcer (e.g. rare earth minerals for EVs
and mobile phones).
Use of carbon capture and storage is
minimal. Current policies are entrenched
seeing New Zealand’s reliance on carbon
sequestration through forestry increase
significantly out to 2050 in an attempt to
offset continued increases in emissions.
New Zealand’s electricity grid is gradually
decarbonised further in line with current
policies. Emission grid factors remain at
0.06 kgCO
2
/kWh by 2050 which means
buildings wishing to achieve net zero
carbon emissions must invest in their
own zero carbon generation.
Existing low carbon materials are readily
available due to low demand but there is
little innovation beyond technologies and
materials currently available. Investment
is prioritised towards adaptation and
climate resilience. Some assets become
stranded as building codes increasingly
become more stringent regarding the
need for buildings to withstand climate
impacts (such as storm events, extreme
rainfall, heatwaves, and floods).
Centralised infrastructure will show
failures and stresses, with some assets
becoming stranded due to the physical
impacts of climate change. Consequently,
local councils increase rates to invest
in protection and restoration of
certain assets.
There are no incentives for meaningful
behavioural change. A significant
breakdown of social cohesion occurs,
with heat stress and mental health
impacts from climate change at record
levels. Food insecurity and growing
populations drive retreat from cities.
Spikes in demand for housing occur due
to climate-driven immigration from
other parts of the world and increasing
numbers of climate refugees.
The pace of insurance retreat accelerates.
Properties in floodplains experience
increasing insurance premiums and
likely experience insurance retreat by
2040. Properties lose value and become
stranded assets. Premiums on coastal
commercial properties may increase to
the point of permanent unprofitability,
leading to them being stranded by 2030.
>3°C
Hot House
World
scenario:
13

RISK DESCRIPTIONTIME HORIZONRELEVANT CLIMATE
SCENARIOS
RISK RESPONSE
Climate-related Regulatory Change
Transition Risk - Policy
The introduction of climate-related policies, for example on low-carbon
building materials and design, land use, mandatory energy performance
ratings, and restrictions on water and energy use could lead to increased
capital expenditure on upgrading properties to a lower carbon, climate-
resilient standard. Flow on impacts could potentially include a reduction
in feasibility of developments and projects.
Short
Medium
Long
Orderly
Disorderly
Hot House World
§
We closely monitor and work with industry bodies to respond to regulatory
changes and comply with new regulations.
§
We are working to prepare for mandatory energy performance ratings
by installing utility metering and monitoring as a first step to build data
on building performance.
Tenant and Purchaser Demand for Sustainable Buildings
Transition Risk – Market
Increased tenant and purchaser demand for sustainable buildings could
result in increased retrofit activities and high demand for low-carbon
building materials across the industry. This could lead to increased costs
to upgrade properties to a sustainable standard. In the long term, failure
to upgrade properties could result in difficulty re-letting buildings or
devaluation of properties.
Short
Medium
Long
Orderly
Disorderly
§
We have a target of 5 Green Star certification for all significant new buildings.
§
We apply an internal Sustainable Refurbishment Framework for
eligible projects.
§
We are working to drive stronger operational sustainability performance
of existing buildings through inhouse facilities management.
Tenant and Purchaser Demand for Resilient Buildings
Transition Risk - Market
Severe weather events (for example, storms and floods) could result in
increased demand for buildings that are resilient to the physical impacts of
climate change. This could result in increased costs to upgrade properties
to be climate resilient or negative financial impacts for buildings in high
risk locations.
Medium
Long
Disorderly
Hot House World
§
We plan to create and implement a Climate Resilience Framework for
PFI properties.
§
Climate adaptation plans are completed for major developments which
assist with designing new buildings to be more resilient to the expected
physical impacts of climate change.
Climate-related Risks
In 2023, we undertook our first assessment of PFI’s climate-related risks across the above three climate-related scenarios. Further information on PFI’s approach and processes to
identifying and assessing climate-related risks can be found in the Risk Management section.
This process has assisted us to identify what we consider to be PFI’s material climate-related risks. A summary of these risks is illustrated below:
STRATEGY CONTINUED
14

RISK DESCRIPTIONTIME HORIZONRELEVANT CLIMATE
SCENARIOS
RISK RESPONSE
Changing Investor and Funder Preferences
and Funding Requirements
Transition Risk - Market
Increased vulnerability to climate-related risks could result in declining
market attractiveness. There is also an increased risk of inability to meet
investor and funder expectations for decarbonisation, particularly where
emissions reduction targets are not met or seen as insufficiently ambitious.
Severe weather events could result in greater expectations among
investors and funders for PFI to own buildings that are resilient to
physical impacts.
Short
Medium
Long
Orderly
Disorderly
Hot House World
§
Execute PFI’s sustainability strategy to manage this risk, including PFI’s
aspiration to minimise embodied and operational greenhouse gas emissions.
§
We disclose progress against climate-related targets and initiatives annually.
§
We are installing utility metering and monitoring at PFI's buildings as a first
step to build data on building performance.
§
We have a target of 5 Green Star certification for all significant new buildings.
§
We apply an internal Sustainable Refurbishment Framework for eligible projects.
§
PFI has launched its Green Finance Framework and established its inaugural
$150 million Green Loan Tranches to support progressive action towards
Green Star targets.
Extreme Weather Events
Physical Risk - Acute
Increased severity and frequency of weather events (for example, flooding,
storms and cyclones) could result in damage or accelerated deterioration of
assets and impact the availability of insurance coverage for specific perils.
This could lead to increased capital expenditure to upgrade properties to a
climate-resilient standard, increased insurance costs, and increased costs
to repair damage not covered by insurance.
Short
Medium
Long
Orderly
Disorderly
Hot House World
§
We review portfolio physical climate risks periodically and complete climate
risk assessments as part of due diligence for new acquisitions (see Physical
Climate-Related Risks on page 16 for further information).
§
We are working to create a long-term insurance strategy to enable PFI
to obtain prudent levels of insurance.
§
We manage physical impacts through proactive maintenance via inhouse
facilities management.
§
We manage our borrowings in a manner that provides a buffer to potentially
cope with extreme weather events and the associated destruction in value
and increase in capital expenditure.
Rising Temperature
Physical Risk - Chronic
Temperature extremes could result in increased demand on air conditioning
systems and electricity use during hot, dry summers. This could also lead
to increased demand from tenants to improve air conditioning and
temperature control within PFI’s buildings.
Medium
Long
Disorderly
Hot House World
§
We plan to create and implement a Climate Resilience Framework for
PFI properties.
Sea Level Rise Risk
Physical Risk – Chronic
Sea level rise leading to insurance retreat from coastal locations and at-risk
properties may become permanently unprofitable or stranded.
LongHot House World
§
Sea level rise risk is a consideration in PFI’s acquisition and
divestment decisions.
§
We have assessed PFI's current portfolio for risk of coastal flooding due
to sea level rise.
STRATEGY CONTINUED
15

Physical Climate-Related Risks
PFI recognises the need to consider and
prepare for the impacts of climate-related
physical risks, particularly under a ‘hot
house world’ scenario. Physical risk
assessments for PFI buildings have
been completed and inform our asset
planning and portfolio management
decisions. Physical risk assessments
also inform our due diligence process
for new acquisitions.
We have improved our understanding
of physical climate risks to PFI-
owned properties by assessing the
following information:
§
S&P Global Climanomics platform
(used to assess a range of climate
hazards as described below); and
§
NIWA’s extreme sea level flood maps
(1%AEP and up to 2m sea-level rise)
for Aotearoa
5
and local Council
hazard maps.
PFI has assessed the vulnerability
of our properties to a range of climate-
related physical risks using the S&P
Global Climanomics platform. S&P
Global Climanomics is a science-backed
climate risk analytics platform that
measures the financial risk of a range
of climate hazards to physical assets.
Risk is calculated using the sum of
climate-related expenses, decreased
revenue, and/or business interruption
and is represented as a percentage of loss
relative to total asset value across PFI's
portfolio (modelled average annual loss).
Based on the climate data available in the
modelling, S&P Global’s experience in
real estate, and the ability of the platform
to assess climate risks for specific
properties, PFI considers this platform
to be an appropriate model to estimate
the physical risks to PFI’s portfolio
across a range of climate scenarios
and time horizons.
The Climanomics platform considers
four Shared Socioeconomic Pathways
(SSPs) that broadly align with the sector
scenarios, including SSP1-2.6 (aligning
with a ‘Disorderly’ scenario), SSP2-4.5
(sitting in between a ‘Disorderly’ and
‘Hot House World’ scenario), SSP3-
7.0 and SSP5-8.5 (aligning with a
‘Hot House World’ scenario).
6
This
assessment indicates that the most
significant potential risks to PFI’s
portfolio are flooding and extreme
temperatures. Further information on
the potential impact of these risks over
a short, medium and long term time
(5) NIWA’s extreme sea level flood map for New Zealand
can be found here: https://experience.arcgis.com/
experience/8e3d7262cc9846968f0bfb86da0806f8
(6) S&P Global’s Climanomics platform does not estimate risks
under an ‘Orderly’ scenario
STRATEGY CONTINUED
horizon can be found in the Metrics and
Targets section.
PFI has also assessed the risk of sea level
rise to PFI's properties using NIWA's
extreme coastal flood map, which
identifies national and regional level
flood hazard and exposure trends with
rising sea levels (across various climate
scenarios). NIWA is a nationally
recognised Crown Research Institute
that provides climate expertise specific to
New Zealand. PFI considers this dataset
to be an appropriate model to understand
which of PFI's properties are located in
regions that are at risk of sea level rise
inundation. Further information can be
found in the Metrics and Targets section.
PFI considers that the information from
the sources above puts PFI in a good
position to consider physical climate-
related hazards as part of asset
management decisions such as
future capital expenditure.
_ Roof construction at
30-32 Bowden Road.
16

OPPORTUNITYOPPORTUNITY
TYPE
TIME HORIZONRELEVANT
CLIMATE
SCENARIOS
Sustainable refurbishments
With increased demand for lower carbon, energy efficient buildings and a focus on decarbonisation among some investors, funders, tenants, and policy
makers, we have a potential opportunity to reduce emissions, improve the operational performance of some buildings in our existing portfolio and improve
building value and desirability through sustainable refurbishments. This may include:
§
Reducing embodied carbon emissions via use of lower carbon materials and reuse of existing materials or structures.
§
Reducing operational carbon emissions, helping our tenants meet their climate commitments and potentially reducing costs via implementation
of energy and water initiatives (for example, LED lighting, metering, water capture and fittings).
§
Helping our tenants move to renewable energy (via solar installations) or implementing sustainable initiatives as part of their lease negotiations.
Transition
Short
Medium
Long
Orderly
Disorderly
Green Star Certification
We have identified an opportunity to use Green Star certification as a differentiator for our new buildings, which may improve building value and desirability.
Through Green Star certification, PFI has the opportunity to reduce embodied and operational emissions and address market and regulatory risks, which may
drive demand for low carbon, energy efficient and climate resilient buildings.
Transition
Physical
Short
Medium
Long
Orderly
Disorderly
Energy performance ratings
We have identified a potential opportunity to gain accreditation for some buildings in PFI’s existing portfolio via energy performance ratings. Power metering
and monitoring is a first step that will allow us to measure operational carbon emissions from energy use in our buildings with an ambition to eventually
reduce these emissions. PFI views this as a potential way to further improve building value and desirability.
Transition
Short
Medium
Orderly
Disorderly
Building climate resilience
With increased severity and frequency of extreme weather events and temperature rise driving demand for resilient buildings, we have an opportunity
to embed climate resilience into PFI’s portfolio. Through the creation of a Climate Resilience Framework, PFI may be able to:
§
Improve resilience of existing assets against the physical impacts of climate change during sustainable refurbishments and developments.
§
Improve PFI’s due diligence and management of properties with heightened climate risk to create a more resilient portfolio.
§
Reduce reactive capital expenditure on responding to climate-related weather events.
§
Reduce the number of insurance claims and improve insurer appetite.
§
Improve the safety of tenants and occupants.
Physical
Short
Medium
Long
Orderly
Disorderly
Hot House
World
Green Finance
PFI has identified an opportunity to secure green finance under PFI’s Green Finance Framework to support progressive action towards our strategic objectives
and Green Star targets.
Transition
Short
Medium
Long
Orderly
Disorderly
STRATEGY CONTINUED
Climate-Related Opportunities
We have also identified climate-related opportunities, which may be used to manage PFI’s climate-related risks.
The following climate-related opportunities have been identified and are being progressed by PFI.
17

STRATEGY CONTINUED
Current and Anticipated Impacts
PFI has already begun to experience
physical and transitional impacts of some
climate-related risks and opportunities.
Impact on Capital Deployment and Funding
Our current understanding of PFI’s
climate-related risks and opportunities
has informed our strategic thinking, and
capital deployment and funding decision
making processes. For example:
§
We have enhanced our due diligence
processes to consider climate-related
risks for new acquisitions, which
includes a consideration of the
potential exposure to physical climate
hazards such as flooding and sea
level rise.
§
Physical climate hazards have been
a factor in some recent divestment
decisions made by PFI.
§
PFI transitioned to an inhouse
facilities management model. This
will enable PFI to work more closely
with contractors and tenants on
operational building performance,
which presents regulatory and
market transition risks as well as
climate-related opportunities for PFI.
In addition, this internal facilities
management team has increased
the proactive maintenance of some
PFI properties to increase their
resilience to climate-related hazards.
This transition was completed in
July 2023, with significant time
and resources being dedicated to
this project.
§
Climate-related transition risks and
opportunities, including increased
demand for sustainable and resilient
buildings, has directly influenced
the implementation of sustainability
initiatives for new and existing
buildings. During 2023, PFI has
applied an internal Sustainable
Refurbishment Framework to a
number of refurbishment projects,
including at 3-5 Niall Burgess
Road and 2-6 Niall Burgess Road,
and commenced developments at
78 Springs Road and 30-32 Bowden
Road (targeting Green Star
certification). These projects have
enabled us to incorporate energy and
water efficiency measures, and use
lower impact building materials. As
part of a sustainable refurbishment,
PFI has also completed its first solar
installation at 3-5 Niall Burgess
Road. PFI is continuing to work
with tenants on solar opportunities
and has commenced power
metering installations. Further
information can be found in the
Metrics and Targets section.
§
PFI launched its Green Finance
Framework during 2023 (available
at https://www.propertyforindustry.
co.nz/sustainability/) and established
its inaugural $150 million Green
Loan tranches in accordance with
that Framework.
Cyclone Gabrielle and Auckland Flood
At the beginning of 2023, two significant
weather events caused widespread
damage and destruction to buildings
and infrastructure across the North
Island. In January 2023, intense rainfall
caused extensive flooding across
Auckland (Auckland flood), and shortly
after, Cyclone Gabrielle caused damage
across regions of the North Island in
February 2023.
Despite a majority of PFI’s properties
being located in the North Island, PFI
experienced relatively limited damage
and loss of access to a small number of
properties as a result of these events.
Claims for damage and business
interruption to these properties were
accepted by insurers, reducing the
financial impacts to PFI. Although there
were no significant financial impacts to
PFI, these events have emphasized the
potential impacts and disruption possible
from extreme weather events.
Insurance Risk
PFI has monitored difficult insurance
market conditions in recent years,
aggravated by inflation, heightened
construction costs, and increased
severity and frequency of climate-related
weather events. Restrictive flood terms
were imposed during the renewal of our
insurance programme during 2023.
Following PFI’s scenario analysis and
climate risk assessment, PFI anticipates
that over a short to medium term time
horizon, insurance will become
increasingly difficult and expensive to
obtain, particularly for certain risks (such
as flooding and other extreme weather
events). The impact of climate-related
weather events on insurer appetite has
18

influenced a strategic decision to move to
a more mature insurance structure, and
during 2023 PFI commenced work to
review the Company’s approach to its
insurance structure.
Power metering and monitoring
In 2022 the Government announced its
intention to introduce mandatory energy
performance ratings for buildings, which
presents both climate-related policy risk
and a market opportunity for PFI. In
anticipation for this regulatory change,
PFI commenced a project during 2023 to
install utility metering and monitoring at
50% of properties by the end of 2025 as
a first step to obtaining data to measure
the operational performance of our
buildings. This will enable us to prepare
for these incoming requirements whilst
also providing a potential opportunity to
gain green certifications for some of our
existing buildings.
Rising temperatures
PFI has identified a risk that rising
temperatures could result in increased
demand on, or for, air conditioning
systems and electricity use, particularly
in a ‘Hot House World Scenario’.
PFI anticipates that this could lead
to increased costs associated with
improving air conditioning and
temperature control within
PFI’s buildings.
Progress towards
Transition Planning
PFI has elected to use Adoption Provision
3: transition planning (NZ CS 2), however
a description of our progress towards
developing the transition plan aspects of
our strategy follows.
PFI is mindful that the impacts of climate
change require us to be responsive to
our changing external environment,
challenge ourselves and be open to trying
new approaches.
PFI’s sustainability strategy (see page 9)
reflects PFI’s early thinking with regards
to transition planning for climate change
and recognises that we need to be flexible
and reassess our approach as the climate
change pathway becomes clearer.
During 2023, we have made progress
in developing a more comprehensive
transition plan with consideration
STRATEGY CONTINUED
for how PFI’s business will change
over the coming decades as the world
transitions to a low-emissions, climate
resilient future.
We recognise that strategic decisions
need to be made to address climate-
related risks and realise opportunities.
Climate-related risks are one of a number
of strategic factors that PFI takes into
account when considering acquisitions
and divestments. PFI is also focusing
on addressing risks and opportunities
associated with our existing stock
of buildings as described earlier in
this section.
PFI is developing a transition plan that
contains several workstreams that are
critical to managing our climate-related
risks and opportunities. We have begun
identifying key initiatives, some of
which we are already working towards
implementing:
§
Maturing PFI’s insurance
strategies to respond to the risk of
insurance retreat.
§
Confirming the long-term strategy
for each new and existing property
in PFI’s portfolio.
§
Implementing a Climate Resilience
Framework, which we intend to
progress in the 2024 calendar year,
to improve the resilience of PFI’s
properties to the physical impacts
of climate change.
§
Updating, and continuing to apply,
PFI’s Sustainable Refurbishment
Framework to manage transition risk
and support our ambition to minimise
carbon emissions associated with
PFI’s buildings.
§
Gaining accreditation for significant
new buildings developed by PFI
through Green Star certification.
§
Exploring options for obtaining
operational performance ratings for
existing buildings within the portfolio
(noting that these are in the early
stages of development for selected
industrial properties in New Zealand
at present).
PFI expects to communicate a more
comprehensive transition plan in 2024. n
19

RISK MANAGEMENT
This section describes PFI’s
processes for identifying,
assessing and managing
climate-related risks and how
these processes are integrated
into PFI’s overall risk
management processes.
Identifying, Assessing and
Managing Climate-related Risks
As noted in the Governance section of
this report, identification, assessment,
and management of PFI’s climate-
related risks and opportunities is led
by PFI’s Head of Sustainability and
Operations, with contribution from the
Senior Leadership Team. PFI undertakes
an annual assessment of both PFI’s
climate-related risks and company-
wide risks, which are reviewed by the
Board annually.
PFI’s Risk Management Framework
governs our approach to identifying
and assessing risks, including climate-
related risks. In line with this framework,
climate-related risks are identified by
reviewing previously identified climate-
related risks and considering any changes
to the internal and external environment.
Risks are then assessed and prioritised
according to our Risk Management
Framework which assesses them against
a risk matrix of likelihood of the risk
occurring and consequences to PFI,
should it occur. The Framework provides
an ‘inherent risk rating ’ and a ‘residual
risk rating ’ , which can be assessed as
low, medium and high risk. The residual
risks are determined by assessing any
changes to consequences and likelihood,
considering PFI’s current responses to
mitigate this risk.
In addition to this typical risk assessment
process, climate-related risks have been
assessed across each sector scenario and
adapted to reflect how they may evolve
in each plausible scenario. We have
also determined the potential impact to
PFI over different time horizons. The
time horizons considered in this risk
assessment are described on page 10.
APPENDIXMETRICS AND
TARGETS
_ A focus on
sustainability
and tracking
progress on
key targets.
20

PFI’s climate-related risks are
characterised as either ‘transition
risks’ associated with transitioning to a
lower-carbon, climate-resilient economy
(such as changes in policy, regulation,
technology, and market), or ‘physical
risks’ associated with the impacts of
climate-change (such as extreme weather
events, storms, flooding, temperature
change, and damage to property). In 2023,
this risk assessment was also informed
by an analysis of the potential impacts
of physical climate-hazards across all
PFI properties through the S&P Global
Climanomics platform as discussed at
page 16.
PFI’s climate-related risks and
opportunities assessment considers PFI’s
direct operations, as well as upstream and
downstream impacts. No parts of the
value chain are excluded.
Managing and responding to climate-
related risks forms part of PFI’s
Sustainability Strategy. Management
oversees PFI’s climate-related risk and
RISK MANAGEMENT CONTINUED
opportunities assessment, which also
identifies any responses and
opportunities PFI may undertake to
manage PFI’s climate-related risks.
Any decisions on PFI’s responses to
climate-related risks, including whether
to mitigate, transfer, accept or control
these risks and opportunities are made
by the management team. PFI’s
assessment of climate-related risks and
opportunities translates through to PFI’s
Transition Plan, which is in the process
of development. Actions being taken
to respond to and manage PFI’s most
material climate-related risks are set
out in the Strategy section.
Integration into Overall Risk
Management Process
Under PFI’s Risk Management
Framework, every PFI staff member is
responsible for the identification,
management and escalation of risks as
part of their role. Risks are discussed at
Senior Leadership Team meetings and
reports on risk management are
provided to the Audit and Risk
Committee at least annually.
In 2023, PFI’s Audit and Risk Committee
and Board reviewed and approved PFI’s
Risk Management Framework, which
was updated to integrate climate-related
risks into the risk management process.
Assessment and management of climate
risk is managed in the same way as our
other risks, with oversight by the Senior
Leadership Team, including the Chief
Executive Officer and Chief Finance and
Operating Officer, and the Board.
PFI’s climate-related risks are also
incorporated into PFI’s company-wide
risk register to give a single view of
PFI’s risks. In most cases, climate risks
are an extension of our existing risks.
Potential impacts of climate change
are considered to present strategic,
financial, operational, ESG, property and
reputational risks for PFI. Our controls
for those risks have been improved to
include consideration for climate change
impacts. For example, PFI added new
controls for PFI’s strategic and ESG
risk, which now includes an annual
review of PFI’s climate-related risks
and opportunities. n
_ Solar
installation
at 3-5 Niall
Burgess Road.
21

METRICS AND TARGETS
This section intends to
describe the metrics and
targets set to measure and
manage PFI's climate-related
risks and opportunities.
Greenhouse Gas Emissions
PFI’s Scope 1, Scope 2 and selected Scope 3 greenhouse gas emissions are set out below.
Further information on PFI’s calculation methodology, assumptions, limitations, uncertainties,
consolidation approach, emissions factors, and excluded emissions is detailed in Appendix 2.
upstream emissions
scope 3
corporate emissions
scope 1 and 2
downstream emissions
scope 3
Goods and services
Capital expenditure
Electricity transmission and
distribution losses
Employee commuting
Fugitive emissions from HVAC systems
Electricity consumption
Diesel emissions from sprinkler systems
Operational waste
Business travel
% TOTAL FOOTPRINT
EMISSIONS SOURCE
Offset
Our carbon footprint
18,072.9
tonnes of C0
2
e
99.6%
17,996.2 TONNES
0.3%
51.2 TONNES
0.1%
25.5 TONNES
22

SCOPECATEGORYFY19 (tCO
2
e)FY20 (tCO
2
e)FY21 (tCO
2
e)FY22 (tCO
2
e)FY23 (tCO
2
e)
SCOPE 1
Direct EmissionsFugitive emissions (refrigerants) 94.5116.876.861.341.2
Fuel Covered under
Category 6
Covered under
Category 6
0.24.55.6
SCOPE 2
Indirect EmissionsElectricity consumption (location based)
7
15.55.414.219.64.4
Total Scope 1 and Scope 2 Emissions110.0122.291.285.451.2
SCOPE 3
Other Indirect EmissionsCategory 1: Purchased goods and services
8
Not measured
in FY19
111.3117.4284.31,244.2
Category 2: Capital goods
9
Not measured
in FY19
2,564.72,615.02,122.416,733.7
Category 3: Energy and fuelNot measured
in FY19
0.51.21.80.5
Category 5: Waste generated in operations0.70.50.20.40.5
Category 6: Business travel 19.89.412.718.425.0
Category 7: Employee commutingNot measured
in FY19
15.113.612.617.7
Category 13: Downstream leased assets
10
Not measured
in FY19
Not measured
in FY20
Not measured
in FY21
Not measured
in FY22
Not measured
in FY23
Total Scope 3 Emissions20.52,701.52,760.32,439.918,021.7
TOTAL Scope 1, 2 and 3 Emissions130.52,823.72,851.32,525.418,072.9
(7) PFI's Scope 2 emissions are comprised of electricity consumption at PFI's head office, vacant properties and common areas. The reduction in Scope 2 emissions in FY23 reflects a combination of lower
vacancy in the portfolio and a change in measurement approach.
(8) For FY23, Scope 3 Category 1 emissions per $ spend was calculated using an input output (IO) consumption-based model. An IO model estimates emissions based on category spend using data from
allocating national GHG emissions to final products based on economic flows between sectors. The IO model is accepted by the GHG protocol and is considered comprehensive, but varies in its granularity.
The increase in Scope 3 Category 1 emissions in FY23 is a reflection of a change in the IO consumption-based model used by PFI, rather than a material change in underlying activity. We will continue to
improve our approach to emissions assessment over time as we mature.
(9) For FY23, Scope 3 Category 2 emissions were calculated using Whole-of-Life Carbon assessment data for major developments, with consumption-based models (see footnote 8) used for the balance of
emissions in this category. The Whole-of-Life Carbon assessments used are an early estimate of the emissions associated with our major development projects. As these projects span multiple financial
years, the emissions have been allocated to financial years based on spend. There may be adjustments made to emissions allocated to future periods to account for any variances from these initial
estimates. The increase in Scope 3 Category 2 emissions in FY23 is attributable to both a change in the consumption-based model used and increased development activity.
(10) Downstream leased assets would include emissions relating to electricity use by PFI’s buildings. PFI has extremely limited visibility of the electricity consumption from its tenanted properties and has
excluded this emissions source from reporting for FY23 due to insufficient data. During 2023, PFI began investing in power metering and monitoring for its properties, which is expected to help develop
emissions models for downstream leased assets by the end of FY24.
Our GHG emissions
23
METRICS AND TARGETS CONTINUED

PFI’s total emissions have increased
significantly in FY23, primarily due
to an increase in construction activity
compared to prior years (Scope 3
Category 2 emissions).
Emissions management
PFI does not have an absolute or
intensity emissions target. PFI’s largest
source of measured emissions is
‘embodied emissions’ from development
and refurbishment activity (Scope 3,
Category 2). These emissions account for
over 92% of PFI’s FY23 measured GHG
emissions. We also note that emissions
relating to the operational performance
of our buildings (for example, electricity
use) are expected to be an additional
material source of emissions (Scope 3,
Category 13). We do not currently report
these emissions due to insufficient data.
Our ambition is to minimise both the
embodied and operational carbon
emissions of our buildings. We have
therefore committed to building and
refurbishing in a way that reduces
both embodied and operational carbon
emissions where practicable. PFI’s target
of a minimum 5 Green Star certification
for significant new buildings aims to
drive a reduction in embodied carbon
where possible when undertaking large
development projects. PFI also has an
internal framework to encourage the
minimisation of carbon impacts for
smaller refurbishment projects.
Embodied carbon will be a particular
challenge for PFI in the coming decades.
These emissions largely arise from the
use of materials such as concrete and
steel when constructing our buildings.
There are lower-carbon products
becoming available, which PFI is
utilising where practicable and given cost
considerations. However, zero or near-
zero carbon concrete and steel are not
available, and it is unknown when these
will become available in future. PFI is
continuing to monitor progress in this
space closely and highlights the re-use
of existing buildings as an opportunity
to reduce these impacts.
Emissions associated with property
maintenance are also significant (falling
under Scope 3 Category 1). Bringing
PFI’s facilities management in-house
has been an important first step in
positioning the business to address
these emissions in future. However, our
primary focus remains on developments,
refurbishments and energy use of
our buildings.
PFI’s Scope 1 and 2 emissions are
relatively minor, in particular when
compared to the scale of emissions from
development and construction activities
(i.e., our Scope 3 emissions).
While our sustainability strategy focuses
on managing our most material
emissions, we acknowledge that we need
to be mindful of our direct footprint, and
have an ambition to minimise and offset
these emissions. In recent years, PFI has
upgraded a significant number of HVAC
systems across our portfolio that required
R22 refrigerant gas, which contributed to
a reduction in our Scope 1 fugitive
emissions by 56.4% (or 53.3tCO
2
e)
against a 2019 base. We will continue to
work on initiatives to further reduce our
gross Scope 1 and 2 emissions going
forward, particularly as new technologies
become available that enable us to make
further advances.
Offsets
We have offset our measured 2023
Scope 1, 2 and selected categories
of Scope 3 emissions
11
with certified
carbon credits. These certified carbon
credits are sourced from a project
that grows and protects forests in
Aotearoa New Zealand through
forest conservation.
12
Internal emissions price
PFI does not currently use an internal
emissions price for its business activities.
PFI has a small team, and relevant staff
members have developed an
understanding of PFI’s material
emissions impacts (in particular, the
impacts of developments, refurbishments
and building operation) through regular
management meetings. At this stage,
PFI does not consider that setting an
internal carbon price will add material
incremental value to the business’s
decision-making with regards to
carbon impacts.
(11) Including waste, business travel, employee commuting,
and energy and fuel; but excluding goods and services,
and capital goods.
(12) Carbon credits are retired on the NZETS registry.
24
METRICS AND TARGETS CONTINUED

METRICINDUSTRY-
BASED METRIC
13
FY23COMMENTARY (FOR FY23 FIGURES ONLY)
GHG emissions intensity
Scope 1 + 2 GHG emissions
(tCO
2
e) / sqm lettable area
0.00006 tCO
2
eSee pages 22-24 for commentary on PFI’s GHG emissions
Assets vulnerable to physical risks
Modelled Average Annual
Loss (MAAL) %
14
due to
pluvial and fluvial flooding
15
0.16 - 0.85%
PFI undertook an assessment of the vulnerability of PFI’s properties to flood risk using S&P Global’s Climanomics platform, which models the
potential financial impact from climate-related expenses (e.g., clean up and repair costs) decreased revenue and / or business interruption.
According to the Climanomics platform, the MAAL over a short, medium and long term time horizon (2020s through to 2090s) due to pluvial
and fluvial flooding is anticipated to range between 0.16 - 0.85% (relative to the current insured value of almost $2B), in a ‘Disorderly’ and
‘Hot House World Scenario’.
(13) Industry-based metrics are aligned to ISSB, Appendix B - [draft] Industry-based disclosure requirements (for draft IFRS S2 Climate-related Disclosures) (2022). PFI is also monitoring metrics used by our peers in the property sector.
(14) Modelled Average Annual Loss (MAAL) % is derived from S&P Global’s Climanomics Platform, which models the potential financial impacts of climate hazards relative to asset value. For PFI, MAAL is calculated using the current insured value of PFI’s portfolio (as at
31 December 2023). This model has a number of limitations and assumptions, including that the modelling assumes PFI, or the tenant are responsible for certain costs, which does not necessarily align with PFI’s lease agreements (negotiated separately). Using local
Council flood maps, PFI has also identified that a significant portion of PFI owned properties are located near or on a flood plain or flood prone area (in some capacity, whether fully or partially). However, this exposure does not necessarily mean the properties are
vulnerable to physical climate risks. As such, PFI does not rely on Council data as an appropriate measure of the ‘vulnerability’ of PFI’s assets to physical risks.
(15) 'Pluvial flooding' occurs when rainfall exceeds the capacity of storm water drainage systems or the ground to absorb it. 'Fluvial flooding' occurs when rainfall causes the water level in a river, lake or stream to rise and overflow onto land.
Other Metrics and Targets
The key metrics used to measure and manage our climate-related risks and opportunities are set out below. We consider these metrics to be most relevant to PFI’s industry and
business model. PFI uses these metrics to understand and assess the extent to which our assets and business activities are vulnerable to climate-related transition and physical
risks and to track progress on climate-related opportunities.
The following metrics were set in 2023, with oversight from the Board.
25
METRICS AND TARGETS CONTINUED

METRICINDUSTRY-
BASED METRIC
13
FY23COMMENTARY (FOR FY23 FIGURES ONLY)
Modelled Average
Annual Loss % due to
temperature extremes
0.38 - 1.57%
PFI has identified a risk that rising temperatures could result in increased demand on, or for, HVAC systems. PFI has assessed the
vulnerability of PFI’s portfolio to this risk using the S&P Global Climanomics Platform, which models the potential financial impact from
climate-related expenses (e.g. HVAC degradation).
According to the Climanomics platform, the MAAL over a short, medium and long term time horizon (2020s through to 2090s) due to
temperature extremes is anticipated to range between 0.38 - 1.57% (relative to the current insured value of almost $2B) in a ‘Disorderly’
and ‘Hot House World’ climate scenario.
PFI notes that this figure is potentially overstated due to the limited use of HVACs within PFI’s buildings at present, albeit refrigerated
warehouses may become more common in a hotter climate.
% of properties by market
value that may be at risk of
coastal flooding due to sea
level rise risk
Ye s2.2%
According to NIWA’s extreme sea level flood maps (1%AEP and up to 2m sea-level rise) for Aotearoa
16
, as at 31 December 2023, PFI owned
three properties that are potentially at risk of coastal flooding due to sea level rise. These properties represent a value of $44.25M (based on
31 December 2023 valuations).
Average % increase in
insurance premium
17
33%
During PFI’s 2023 insurance renewal, PFI experienced an average increase of 33% in premiums compared to the prior year’s premiums.
This increase is attributable to a range of factors such as increased sums insured, the physical impacts of Cyclone Gabrielle and the Auckland
floods, and increased climate events globally. The majority of insurance premiums are recovered from PFI's tenants.
Assets vulnerable to transition risks / alignment with climate-related opportunities
% of portfolio by value
that has achieved a
green building rating
Ye s0%
During 2023, PFI owned no buildings with a Green building rating, however we are currently working towards obtaining Green Star certification
for significant new buildings.
% of portfolio by value
that is registered for a
green building rating
Ye s6.8%
During 2023, PFI began working on developments targeting Green Star certification for three buildings at 30-32 Bowden Road and 78 Springs
Road, meaning that 6.8% of PFI’s portfolio by market value is currently registered for 5 Green Star certification.
(16) There is no data for the Bay of Plenty region within the NIWA extreme sea level flood maps, therefore PFI has not yet assessed the risk of sea level rise for properties located in this region.
(17) The average increase in premium does not include six tenant-insured properties in PFI's portfolio as PFI does not have oversight of these premium increases.
26
METRICS AND TARGETS CONTINUED

METRICINDUSTRY-
BASED METRIC
13
FY23COMMENTARY (FOR FY23 FIGURES ONLY)
% of properties that have
power metering installed
Ye s21.7%
PFI has a potential opportunity to obtain operational performance ratings for some properties in our portfolio in future, with a need to collect
utility data in the interim to prepare for this. PFI has committed to installing metering at 50% of PFI’s properties by the end of 2025, having
completed almost half of this goal during 2023.
% of total funding facilities
that is Green Debt
18
16.7%
During 2023, PFI developed a Green Finance Framework to support progressive action towards our strategic objectives and target to develop
significant new buildings to a 5 Green Star certification. At the same time, PFI also announced the establishment of inaugural $150m Green
Loan tranches, which will be used to fund the Company’s committed Green Star developments at 30-32 Bowden Road and 78 Springs Road.
Capital deployment towards climate-related risks and opportunities during FY23
Gross capital investment
deployed toward Green
Star buildings
$64.25M
As part of executing PFI’s strategic goal for all new significant buildings to target a minimum 5 Green Star certification, PFI commenced
construction on major developments targeting 5 Green Star certification for three new buildings during 2023.
During 2023, PFI deployed a gross amount of $64.25M in capital expenditure towards these developments. This figure does not separate the
incremental spend that is ‘climate-related’ from general Green Star development costs, nor does it provide an estimate of additional costs
incurred for undertaking Green Star developments, (therefore the gross spend also encompasses costs that are not climate-related).
Gross capital
investment deployed
toward solar installations
$193kDuring 2023, PFI spent $193k in capital expenditure to install solar panels at 3-5 Niall Burgess Road.
Gross capital
investment deployed
toward metering
and monitoring
$448kDuring 2023, PFI spent $448k in capital expenditure to install power and water metering and monitoring at PFI’s properties.
(18) Green Debt is defined in PFI’s Green Finance Framework
Remuneration
During 2023, the key performance indicators underpinning the short-term incentives
of the Senior Leadership Team included sustainability-related measures and objectives.
This included progressing 5 Green Star certification for new developments and the
successful transition to in-house facilities management.
27
METRICS AND TARGETS CONTINUED

Targets
PFI has committed to key targets to operationalise its Sustainability Strategy.
The time frames for these targets align to the time horizons set out on page 10.
Performance as at 31 December 2023 against these targets is also described below.
TARGETTIME FRAMEBASE YEARPERFORMANCE
GREEN STAR
Significant new buildings to target minimum 5 Green Star certification
Short
Medium
Long
2023
We are currently targeting 5 Green Star certification for three buildings at 30-32 Bowden
Road and 78 Springs Road.
METERING
Implement power metering and monitoring for 50% of properties by the end of 2025
Short2023Power metering and monitoring have been implemented at 21.7% of properties.
SOLAR
Install solar systems at five buildings by the end of 2025
Short2023
During 2023, PFI completed our first solar panel installation at 3-5 Niall Burgess Road.
We have also continued to work with several tenants on solar opportunities.
These Group climate-related disclosures are signed on behalf of Property for Industry Limited and were authorised for issue on 5 April 2024.
Dean Bracewell Carolyn Steele
Board Chair Audit & Risk Committee Chair
28

APPENDIX
Appendix 1:
Key Board engagements
relating to climate-related risks
and opportunities during FY23:
BOARDAUDIT & RISK COMMITTEE
February 2023Climate-related Disclosures update including progress
against targets within PFI's sustainability strategy and
preparation for CRD.
May 2023Climate-related Disclosures update, including progress
against targets within PFI's sustainability strategy.
June 2023Climate-related Disclosures update, including progress
in preparation of CRD.
August 2023Review of annual Climate-related Risk and Opportunity
Assessment, including discussion of PFI’s scenario
analysis exercise.
Climate-related Disclosures update including progress
against targets within PFI's sustainability strategy.
Review of Board skills matrix, including climate-related skills.
Review of annual Climate-related Risk and Opportunity
Assessment, including discussion of PFI’s scenario
analysis exercise and review and endorsement of PFI's
Risk Management Framework.
November 2023Climate-related Disclosures update, and review and
approval of PFI's Risk Management Framework.
December 2023Climate-related Disclosures update, and review
and approval of the A&RC Charter to incorporate
climate-related responsibilities.
Review and confirmation of PFI's metrics and targets.
Board training on Climate-related Disclosure regime
by external provider.
Climate-related Disclosures update.
Review of PFI's risk register.
Review and endorsement of A&RC Charter to incorporate
climate-related responsibilities.
29

Appendix 2:
Measuring our emissions
PFI’s greenhouse gas emissions for the
reporting period ended 31 December
2023 have been measured and prepared
in accordance with the Greenhouse Gas
Protocol: A Corporate Accounting and
Reporting Standard (revised edition) and
the Greenhouse Gas Protocol: Corporate
Value Chain (Scope 3) Accounting and
Reporting Standard (GHG Protocol).
PFI’s greenhouse gas emissions for this
reporting period are not subject to an
external assurance engagement, however,
they have been externally peer reviewed
by Ekos Kamahi Limited to check
alignment with the GHG Protocol.
Organisational Boundary
PFI is comprised of a single holding
parent company, Property for Industry
Limited, and a subsidiary company,
P.F.I. Property No. 1 Limited (P.F.I.
No.1), which owns the full PFI
property portfolio.
Consolidation Approach
PFI has applied an operational control
approach to its GHG inventory. All
emissions that PFI has operational
control over in its own head office and
within its property portfolio are covered
in this inventory. This approach allows
us to focus our initiatives on the emission
sources which we have operational
control over and can make decisions on in
line with our Sustainability Strategy.
Baseline year
PFI’s baseline inventory is 2019. The
2019 base year was selected to enable
early performance comparison across
reporting years.
Adoption Provisions
PFI is reporting on Scope 1, 2 and
selected Scope 3 emissions. PFI is
relying on Adoption Provisions 4 and
5 in NZ CS 2 with respect to its Scope
3 Category 13 emissions. PFI has
chosen to disclose a selection of Scope 3
emissions where we have sufficiently
reliable data and measurements,
including purchased goods and services,
capital goods, energy and fuel, waste
generated in operations, business travel,
and employee commuting (Categories
1,2,3,5,6, and 7 respectively).
Methodologies, assumptions,
limitations and uncertainties
PFI’s GHG emissions have also been
calculated with guidance provided by
Greenhouse Gas Protocol: Technical
Guidance for Scope 3 Emissions (version
1.0) (Technical Guidance). Emissions
factors and Global Warming Potential
(GWP) rates were sourced from the
Ministry for the Environment’s 2023
Detailed Guide for Measuring Emissions
for Organisations (MfE Guide)
19
. In
addition to the MfE Guide, emissions
factors have also been sourced from the
UK Department for Environment Food
and Rural Affairs conversion factors
20
,
and the consumption-based emissions
modelling report prepared for the
Auckland Council
21
.
Data for Scope 1, 2 and 3 emissions
are captured by PFI’s team members.
(19) MfE, Measuring emissions: A guide for organisations, 2023
detailed guide
(20) UK Government GHG Conversion Factors for Company
Reporting (2023)
(21) The Market Economics Limited, 2023, Consumption Emissions
Modelling report prepared for Auckland Council (Table 5
Consumption Emission Intensities for the Year Ending 2019)
has been used to calculate Scope 3 Category 1: purchased
goods and services and Scope 1 Category 2: Capital
Goods (excluding construction-related emissions for major
developments at 78 Springs Road and 30-32 Bowden Road).
30
APPENDIX CONTINUED

For most emissions sources, supplied
source data was multiplied by the
relevant emission factor or GWP rate.
Specific data uncertainties and
limitations are set out below.
Changes in methodology
PFI intends to improve our approach
to emissions assessments over time
as we mature, and our FY23 GHG
inventory contains a number of changes
in methodology when compared to
prior years.
Scope 2 emissions
PFI has chosen to use records provided
by electricity suppliers to calculate
Scope 2 emissions (purchased electricity)
for its FY23 reporting period as opposed
to the spend-based method used in prior
reporting periods (expenditure divided
by the average $/kWh in New Zealand).
This change in methodology reflects a
move to a more reliable data source.
Electricity used in common areas of
our buildings are typically categorised
under our Scope 2 emissions. Through
PFI's in-house facilities management
team, we have made some refinements
to our methodology, which has also
contributed to a reduction of our
reported Scope 2 emissions.
Construction-related emissions for
major developments
Construction-related emissions for PFI’s
major developments at 78 Springs Road
and 30-32 Bowden Road (covered under
Scope 3, Category 2: Capital Goods) have
been estimated using data from draft
Life-Cycle Assessments (LCAs) prepared
by Beca Limited.
22
This change in
methodology intends to more accurately
convey the construction-related
emissions from PFI’s major development
activities using estimated emissions
totals for the product and construction
stage of each development. The following
uncertainties and limitations apply:
§
The LCA data used is for upfront
carbon only (i.e., through to the
end of construction), which is
assumed to cover Scope 3 Category 2:
Capital Goods.
§
The draft LCA data contains
estimated emissions for PFI’s major
developments, which will not be
finalised until practical completion
and is subject to limitations,
uncertainties and possible change.
For example, different types or
quantities of materials may be used
during the project compared to
what was anticipated when the draft
figures were calculated.
23

§
The LCA data is calculated ‘as at
practical completion’ and these
developments will span over more
than one reporting period before
receiving practical completion.
Therefore, a spend-based method
has been employed to calculate
the emissions for the FY23 period
only. It is assumed that there is a
correlation between the project spend
to date and the volume of carbon
emissions produced).
Scope 3: Category 1 and 2 emissions
The methodology used to estimate PFI’s
Scope 3 Category 1 (Purchased Goods
and Services) and remaining Category
2 (Capital Goods) emissions (where
LCA data was not available) involved
multiplying spend against emissions
factors derived from a consumption-
based model. Consumption-based models
are accepted by the GHG protocol and
are considered comprehensive but
vary in their granularity. For our FY23
(22) LCAs have been prepared by Beca Limited for the
purpose of design review and certification under the
Green Star framework.
(23) Adjustments for these changes, should they arise, will
be made in future accounting periods. We do not plan to
restate the FY23 footprint to account for these changes.
(24) Emissions factors for calculating Category 1 and 2 emissions
in FY20, FY21 and FY22 reporting periods were derived
from GZA’s US environmentally-extended input output
(EEIO) model.
reporting period, PFI has selected a
NZ consumption-based model over a
US consumption-based model
24
, which
had been used in prior reporting periods.
This change in methodology is due to
the fact that the NZ consumption-based
model uses local data from StatsNZ and
New Zealand currency and is therefore
more relevant to PFI as a business
operating within New Zealand.
Whilst the change in model has
significantly increased the assessed
emissions, the outcome is considered
to be reasonable. The NZ consumption-
based model provides an estimate only,
and this model relies on the quality of
the statistical data used to calculate
emissions factors and the categories
aligning with PFI’s accounting codes.
31
APPENDIX CONTINUED

GHG EMISSIONS SOURCEFACILITIES MEASUREDDATA SOURCE AND COLLECTIONKEY UNCERTAINTIES, LIMITATIONS AND ASSUMPTIONS
Scope 1
Fugitive Emissions from
HVAC systems
All properties within portfolio where
the HVAC is owned and maintained
by PFI.
Records from HVAC suppliers (emails and reports)
detailing the quantity used (in kg) to top up HVAC
systems during the year.
Medium uncertainty – assumption that records provided by HVAC
suppliers represent a complete and accurate account of all fugitive
emissions from HVAC systems. Assumption made that the quantity of
refrigerant gas topped up equals the quantity of the refrigerant gas lost
during the reporting year.
Diesel emissions from
sprinkler systems
All properties with diesel-powered
sprinkler systems that are owned
and maintained by PFI.
Records from suppliers that maintain PFI’s sprinkler
systems (emails and reports) detailing the quantity
of diesel used (litres) to top up sprinkler systems.
Medium uncertainty – assumption that records provided by contractors
are accurate account of diesel emissions from sprinkler systems.
Scope 2
Electricity consumption
(location based)
25
Vacant properties, properties with
common area power and PFI’s
head office
Records from electricity suppliers (invoices and
metering reports), which record kWh consumed.
Low uncertainty – assumption that the meter readings are correct and that
the kWh provided by electricity suppliers are an accurate record of the
electricity consumed.
(25) Scope 2 emissions include purchased electricity for vacant properties and properties with common areas within PFI’s portfolio, and in PFI’s Head Office.
Emissions Source Inclusions
A summary of the emissions sources included in this inventory is provided below, along
with a description of the methods, assumptions, limitations, and uncertainties relevant
to calculating or estimating emissions.
32
APPENDIX CONTINUED

GHG EMISSIONS SOURCEFACILITIES MEASUREDDATA SOURCE AND COLLECTIONKEY UNCERTAINTIES, LIMITATIONS AND ASSUMPTIONS
Scope 3
Category 1: Purchased
goods and services
Emissions relate to goods and
services purchased.
Expenses report for FY23 extracted from PFI’s
accounting software.
High uncertainty – data limitations meant that a spend-based method
was employed.
Limitations in methodology used to calculate Scope 3 Category 1 emissions
are described above.
Category 2: Capital Goods
emissions sources related to
the upstream (cradle-to-
gate) emissions from the
production of capital goods
purchased by PFI.
Emissions relate to capital goods for
PFI-owned properties
Dollar spent from internal records and draft data
from Whole-of-Life Carbon Assessments
.
High uncertainty – a combination of a spend-based method and
estimations using draft Life-Cycle Assessment data was employed.
Limitations in methodology used to calculate Scope 3 Category 2 is
described above.
Category 3: Fuel and
Energy Transmission and
distribution losses
Properties for which PFI is
responsible for paying the electricity.
Records from electricity suppliers – total kWh from
PFI’s Scope 2 emissions from purchased electricity.
Low uncertainty – assumption that electricity invoices and meter readings
accurately represent the energy that PFI consumed across its offices, vacant
properties, and common areas.
Category 5: Waste
generated in operations
(Office waste)
Waste generated from PFI’s head
office.
Proxy measurementMedium uncertainty – supplier data on office waste was unavailable.
Instead, a proxy measurement was used to calculate the emissions
associated with waste generated from PFI’s head office.
Category 6: Business
Travel – Air travel (domestic
and international flights)
Staff from PFI head office.Records include invoices and booking confirmations
containing destination travelled and number of
passengers.
Low uncertainty – assumption that all flights taken by PFI staff for
business travel are captured in the accounting data.
Category 6: Business
Travel – Taxi
Staff from PFI head office.International travel and domestic travel reports
from PFI’s accounting system.
Low uncertainty – assumption that that all taxis (including ride sharing
modes) used for PFI staff business travel are captured in the
accounting data.
33
APPENDIX CONTINUED

Emissions Source Exclusions
Scope 3, Category 13 emissions (downstream leased assets) are currently excluded from PFI’s
inventory due to an absence of data.
We acknowledge that emissions associated with electricity consumed by PFI’s buildings is likely
to be a significant source of PFI’s Scope 3 emissions. Currently, PFI has insufficient data to provide
a meaningful estimate of building electricity consumption within PFI’s property portfolio. During
2023, PFI began investing in utility metering for its properties, which is expected to develop
emission models for downstream leased assets. PFI intends to include estimated Category 13
emissions for the FY24 reporting period.
There are also likely to be fugitive emissions from building HVAC systems that tenants manage.
It is unlikely that PFI will be able to gain visibility of these fugitive emissions. However, the vast
majority of HVAC systems in PFI buildings are managed by PFI, and tenant-managed fugitive
emissions are not expected to be material when compared to building electricity.
Scope 3, Categories 4 and 8 are calculated within Category 1 emissions. Categories 9, 10, 11, 12,
14 and 15 do not apply to PFI's operations.
GHG EMISSIONS SOURCEFACILITIES MEASUREDDATA SOURCE AND COLLECTIONKEY UNCERTAINTIES, LIMITATIONS AND ASSUMPTIONS
Category 6: Business
Travel – Rental cars
Staff from PFI's head office.Invoices from rental car companies which record the
odometer reading before and after PFI’s staff have
used the rental car, and the total km driven.
Medium uncertainty – assumption that all rental car invoices have been
captured and that this accurately reflects km travelled in rental cars. It is
assumed that all rental cars were petrol.
Category 6: Business
Travel – Staff mileage
Staff from PFI’s head office.Mileage report is taken from PFI’s expense
management system, detailing kilometers (km)
travelled in private vehicles for business.
Low uncertainty – assumption that all business trips made in private staff
vehicles are captured in the accounting data. Assumptions made about the
age and engine size of staff cars.
Category 6: Business
Travel – Hotel
accommodation
Staff from PFI head office.Hotel booking confirmations containing information
on number of people and number of nights.
Low uncertainty – assumption that all accommodation associated with
business travel is captured.
Category 7: Employee
commuting – (including
private staff vehicles, bus,
train, ferry and working
from home)
Staff from PFI head office.Employee Commuting Survey results. The data
collection unit is kilometers (km) travelled to work
via private vehicle, bus, train and ferry and number
of days worked from home.
Medium uncertainty – assumptions that the answers provided by PFI’s
employees in the survey are a complete and accurate representation of how
employees commuted to work in a typical week. Assumptions have been
made around the number of days worked and distance travelled.
34
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