Over the past financial year, we have achieved net zero for Scope 1 and 2 emissions for Germany and the UK.  

Our net zero statement includes Scope 1 and Scope 2 emissions, as well as Scope 3 categories of Business Travel, Waste to Landfill, and Downstream Transport and Distribution. These represent the minimum mandatory boundary for the Net Carbon Zero certification, awarded by Achilles, a global data verification company. This reflects the steady progress in managing our direct emissions, and the ongoing implementation of our energy and carbon reduction measures.

Scope 3 emissions, which continue to account for over 99% of our total emissions and are primarily driven by tenant activities, remain our most significant challenge and will be a central focus for our ongoing efforts. Achieving a meaningful reduction in Scope 3 emissions will require sustained engagement and collaboration across our value chain, particularly with our tenants.

We remain committed to our long-term objective of achieving net zero across Scopes 1, 2 and 3 in line with national targets, by 2045 in Germany and by 2050 for the UK. Equally, our overarching ambition which we set last year, remains to reduce our Scope 3 emissions intensity per square metre by 45% by 2040, using FY2021/22 as a baseline.

To support our ambitions, we continue to roll out decarbonisation initiatives across our portfolio. These include the installation of LED lighting, photovoltaic (PV) systems and the replacement of outdated heating systems, all of which contribute to long-term energy efficiency and carbon reduction.

Decarbonisation pathway assumptions

This target is benchmarked against the CRREM version 2.5 methodology and the Science-Based Targets initiative (SBTi), applying a location-based approach for emissions factors. As noted last year, this ambition does not yet account for emissions from industrial tenants’ processes, which are not covered under the CRREM methodology and remain a significant but complex component of our portfolio.

Over the past year, we have refined, and will continue to refine, our carbon modelling based on new data from pilot projects, evolving tenant data, sector guidance and a better understanding of our asset profiles. Changes to our portfolio through acquisitions and disposals also influence the direction of our decarbonisation pathway, requiring ongoing updates to our assumptions and projections. This adaptive approach enables us to test assumptions, incorporate lessons learned, and stay responsive to changes in policy, technology, and market or portfolio dynamics.

While our ambition does not currently include embodied carbon or emissions from our 35%-owned Titanium venture, these will be addressed through a separate engagement programme. We also recognise that the pace of national grid decarbonisation in the UK and Germany may impact our pathway, and we will monitor this closely.

Adapting and refining our approach

We remain committed to adapting and refining our approach, ensuring our pathway to net zero remains credible, measurable, and aligned with operational realities. Equally, we will continue to apply careful financial management to the delivery of our decarbonisation strategy. It remains our ambition to absorb the required investment within our normal planning and budgets, as we continue to integrate decarbonisation into our long-term asset management and operational strategies.

Progressing energy and carbon reduction initiatives

We continue to manage our carbon footprint across both our German and UK portfolios through energy efficiency upgrades, renewable energy provision, and aligning our initiatives with our long-term decarbonisation pathway.

In Germany, we have maintained our net zero emissions status for Scopes 1 and 2 with minimal reliance on validated carbon offsets. This has been achieved by ensuring that nearly 100% of the electricity used in our asset management offices is sourced from renewable energy and by ongoing improvements to energy efficiency. Across our German portfolio, the proportion of renewable electricity against total electricity provision is forecast to increase slightly to 99.84%.

In the UK, we achieved net zero for Scope 1 and 2 emissions, supported by sourcing 96% of total electricity from green energy sources, driving energy efficiency initiatives, and minimal use of carbon offsets. Furthermore, we continue to integrate energy efficiency initiatives as part of our broader decarbonisation strategy, focusing on enhancing building performance through EPC upgrades. In FY2023/24, we successfully met our target of achieving an EPC rating of C or better for at least 55% of our UK sites. This target was maintained in FY2024/25 as we prioritised sites with EPC certificates expiring in 2025, ensuring that all reassessments met a minimum rating of E or better. Looking ahead, we anticipate increasing this figure to 65% by the end of FY2025/26. In parallel, we have reviewed our mid-term pathway to align with the UK Government’s goal of achieving EPC B ratings across the full portfolio by 2030. Based on our current progress, we remain confident in meeting this target. However, we recognise that government policies and timelines may evolve, and we continue to monitor regulatory developments.

2025 electricity provision

 

Germany	UK
99.84% forecasted proportion of renewable electricity against total electricity	96% of total electricity from green energy sources

Enhancing the energy efficiency of our assets is a core part of our decarbonisation strategy. Our LED replacement programme has continued across the Group, reducing energy consumption in support of our ESG objectives. In Germany during FY2024/25, we completed 78 lighting optimisation projects, contributing to our energy efficiency goals through both targeted initiatives and as part of our routine refurbishment work. We have already identified an additional 27 ESG-focused projects for future upgrades, separate from normal course refurbishment. In the UK, energy efficiency improvements such as LED upgrades are delivered as part of our broader EPC improvement programme. While individual elements are not separately tracked, they are integrated into a strategic approach that supports our long-term goals.

Smart energy metering remains a valuable tool for improving energy management. Most of our sites in the UK are equipped with smart meters, and work is ongoing to look at remaining properties, including recent acquisitions. In Germany, we are working towards digitising our smart energy meters by 2027. Our implementation plan is in place, with final approvals and expectation to commence the programme in the next financial year, starting with the properties within the Titanium venture. The outcomes from the Titanium properties will then be assessed for how we manage the rollout across the remainder of the portfolio. This proactive approach ensures that all our properties will be equipped with smart meters in advance of the 2030 regulatory requirements for grid providers.

Heating system replacements and improvements are also being assessed and implemented across our portfolio. In Germany, we have made progress with smart thermostat installations, completing nine projects during FY2024/25, with two heating system replacements planned for FY2025/26. In addition, we are exploring opportunities to connect sites to the district heating network, as well as other options appropriate to our heating system and site dynamics. In the UK, we continue to evaluate the need for heating system upgrades in alignment with our EPC improvement programme, ensuring our assets meet evolving energy efficiency standards.

Looking ahead, we will further refine our decarbonisation pathway to 2030, incorporating our capital expenditure plans, regulatory developments and progress made of our energy and carbo reduction initiatives. Our aim is for our assets to remain compliant with sustainability requirements while supporting our broader climate and corporate goals.

Generating onsite renewable energy through PV installation

Building on the foundation established in FY2023/2024, we have continued our work to install photovoltaic (PV) systems across our sites as part of our decarbonisation strategy.

In Germany, our dedicated PV business, Sirius Renewable Energy GmbH, has made progress in rolling out PV systems across our portfolio.

In addition to the PV system in Augsburg, a further 10 properties have been equipped with PV systems during FY2024/25, moving from 0.8MWp installed capacity to 2.9MWp. New systems were installed at Tempelhof, Markgröningen, Aachen I, Frickenhausen, Göppingen, Alzenau Industrie Str., Alzenau Siemens Str., Gartenfeld, Ludwigsburg, and Borsig, with final commissioning pending for some of these sites.

Looking ahead to FY2025/26, we have identified 10 further sites for installation, including Oberhausen, Rostock, Nuremberg, Hanover, Bonn, Nabern I, Mannheim, Erfurt, Rastatt, and Neckartenzlingen. These installations are expected to add a further 3.1MWp of installed capacity across more than 18,000m2 of roof space

FY 2024/25	FY 2025/26
11 properties equipped with PV systems, increasing capacity to 2.9MWp	10 further sites identified for installation expected to add further capacity of 3.1MWp

An assessment of our German portfolio has identified that approximately 18% of our total roof area has potential for PV installation. This is forecast to generate up to 20 million kWh annually, of which 16–17 million kWh could be consumed on site, which equates to a potential offset of 14–15% of total electricity demand across the portfolio. We will continue to make progress towards unlocking this capacity as part of our long-term decarbonisation strategy, ensuring our planning is based on careful operational and financial considerations.

In the UK, our two pilot projects in Solihull and Theale are now live, with energy consumption tracking in line with expectations and financial savings materialising as projected. Work has also begun at our recent acquisition Gloucester Vantage Point, which has a 1.4MWp solar system that generates around 1,200,000kWh of solar energy every year, to evaluate the potential benefits of battery storage to enhance energy efficiency. Following internal feasibility studies, we have identified eight additional sites in the UK that may be suitable for PV installations and are undertaking a structural survey at one of these ahead of commencing work. We will continue to explore opportunities for further installations where feasible.

As we make further progress in our PV programme and work to finalise plans for installations in FY2025/26, we will continue to refine our decarbonisation modelling to incorporate energy generation and emissions reduction ambitions.

Enhancing data collection and transparency

We continue to strengthen our data collection and integration processes to enhance the reliability of our greenhouse gas (GHG) measurement system. Our ESG Department in Germany and our team in the UK are key to driving our decarbonisation efforts, playing a significant role in monitoring and reporting on our emissions data.

For the third consecutive year, our emissions have been independently verified by Achilles, a global data validation company. This verification reinforces our commitment to transparency in our emissions reporting. 

Our GHG Emissions Report can be found on page 38 and 39 of our Annual Report and Accounts 2025.

Promoting sustainable transport

As part of our management of Scope 1 and 2 emissions, we aim to reduce transport-related emissions and promote low-carbon transport options for our employees, where possible. Since 2020, we have been transitioning our company car fleet to hybrid and electric vehicles, with 96.4% of our fleet in Germany now consisting of low-emission models. In the UK, we have a salary sacrifice scheme to promote the uptake and use of fully electric vehicles.

To promote sustainable travel, we encourage using train for business trips wherever feasible and also provide support for active commuting. We offer a bicycle leasing programme in Germany, and in the UK, we participate in the Cycle-to-Work scheme, promoting both employee wellbeing and emissions reduction.