EQ Impact | Environmental, Social and Governance Report 2020

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2019–2020

Building Economic Health in Communities ENVIRONMENTAL, SOCIAL AND GOVERNANCE REPORT


ESG Report 2019–2020

Letter to Our Stakeholders

Building Economic Value for Local Communities At EQ Office, we own and manage a portfolio of properties spanning from coast to coast and sidewalk to skyline. We’ve built our company with a deep sense of responsibility to those we affect every day, starting with our people, customers, partners and neighbors across the country.

As we faced so many challenges during this unprecedented year, we felt called to dig deeper into our reason for being as an organization. We launched a comprehensive audit of our impact and assessed all of the ways we contribute to neighborhoods where we operate. Examining every aspect of EQ, we defined our success as having a positive impact on society, with detailed strategies and ambitious benchmarks for the future of what we do. I’m thrilled to share our first annual report on our environmental, social and governance efforts, which illustrates our formal commitment to ground our actions and decision-making in our shared purpose: OUR PURPOSE

To build economic health in communities by regenerating urban spaces, preserving local culture and driving humanity into the workplace.

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EQ Office


ESG Report 2019–2020

Letter to Our Stakeholders

GOALS OF THE REPORT EQ’s 178 member team lead and live our purpose in all aspects of our business. We’ve set goals to reach even higher in the short and long term. This report details the formal practices we’ve established, the benchmarks we’ve met between August 1, 2019 and July 31, 2020 and our quantifiable goals for measuring success moving forward across our three pillars: • Regenerating Urban Spaces (Environmental) • Preserving Local Culture (Social) • Driving Humanity Into the Workplace (Governance) The call to examine and formalize our ESG efforts this year inspired unprecedented collaboration engaging more than a third of our company. This team worked together to assess our strengths as an organization and identify the most pressing opportunities for positive impact in our communities and society. By connecting our assets to urgent community needs — and formalizing our strategies in those areas — we uncovered our purpose and developed a plan to unlock increasingly positive outcomes for all our stakeholders, not only for our customers and partners, but also for society as a whole.

We look forward to reporting annually on our progress and involving you in our journey. Together in purpose,

Lisa Picard

During this process, we recognized that EQ has always served as a catalyst for good by creating tangible economic value for our customers, partners and the communities where we operate. Our key offerings — effective workspaces, greater workforce readiness, cultural and environmental preservation, as well as health and safety preservation — all support our true purpose. In particular, this pandemic has given us greater awareness of opportunities to uplevel our health and safety protocols and practices within our properties. We extended these efforts into our communities through responsible management and charitable giving. 3

EQ Office


ESG Report 2019–2020

ESG Highlights for 2019–2020

ESG Highlights for 2019–2020 $521,600

$11,209,638 32%

donated to organizations dedicated to workforce development and job training.

invested in community wellness, benefitting 23,500 people.

of properties in portfolio have achieved LEED certification.

107,479 sf

$347,227

$3,559,814

donated to nonprofit organizations, providing $603,699 in savings for their missions.

invested in professional development trainings.

invested in local artists.

35.66%

100%

38%

energy reduction year-over-year across our portfolio with $2,856,114 savings to invest in community.

of our properties held at least one environmental education event this year.

of buildings in portfolio participate in clean power.

61.05%

51,293

of waste diverted across all construction projects; 38.05% diverted across portfolio operations.

jobs created through EQ’s unique design approach.

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EQ Office


ESG Report 2019–2020

Table of Contents

Table of Contents

LETTER TO OUR STAKEHOLDERS

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ESG HIGHLIGHTS FOR 2019–2020

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SOCIAL IMPACT STRATEGY & RESULTS Charitable Giving Job Creation & Skills Training CASE STUDY: National Impact Partnership With YouthBuild USA Community Development Health & Wellness Support Responding to COVID-19 Social Impact Benefits for EQ Team CASE STUDY: Transformation of South Wacker Drive Goals

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6 8 9 10 11 12 13 14 15 16

ENVIRONMENTAL STRATEGY & RESULTS Waste Management Sustainable Procurement Water Environmental Resiliency CASE STUDY: Von Karman Creative Campus Energy Air Quality CASE STUDY: Energy Conservation at Willis Tower Goals

17 19 20 22 22 23 24 25 26 27

GOVERNANCE STRATEGY & RESULTS Diversity & Inclusion Integrating ESG Into Our Acquisition Process Customer Engagement Ethical Management & Loss Reduction Tracking & Reporting Thought Leadership & Awards CASE STUDY: EQ Thought Leadership in Action ESG Leadership Goals

29 31 32 33 34 34 35 37 38 40

REPORTING METHODOLOGY

41

THE ROAD AHEAD

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ESG Report 2019–2020

Social Impact Strategy & Results

SOCIAL IMPACT

Preserving Local Culture

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EQ Office


ESG Report 2019–2020

Social Impact Strategy & Results

Both at the corporate and local level, EQ Office is dedicated to supporting the culture, people and landscapes that underpin thriving communities. We’re focused on attracting and retaining talent — and helping our customers and partners do the same — while improving productivity and ensuring health and safety for all.

Customer, employee and partner relationships are our greatest connection to our shared neighborhood. With that in mind, we’ve invested our resources into workforce development, job training and placement for community members, developing distinctive retail partnerships and incorporating local art and culture into every portfolio property.

Parallel to these projects, we’ve invested in new technology and processes to track key metrics that ladder up to our goal of preserving local culture. We’re thrilled to quantify our impact and fine-tune our investments based on the outcomes we’re tracking every quarter.

Core Social Impact Initiatives:

1. Charitable Giving

2. Job Creation & Skills Training

3. Community Development & Integration

4. Health & Wellness Support

5. Responding to COVID-19

6. Social Impact Benefits

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ESG Report 2019–2020

Social Impact Strategy & Results

1. Charitable Giving EQ’s charitable giving efforts leverage our assets, from significant monetary donations to in-kind gifts of donated space for nonprofits and donated items like furniture and essential supplies. At 350 North Orleans, for example, our team donated space to Ladder Up, which provides hardworking people with the resources they need to move up the economic ladder. The team at 44 Wall Street in New York also gave NYC Mammas Give Back a rent-free office to support pregnant moms and young families. EQ has also created an annual Social Week of Giving, offering customers and team members a chance to work together on daily service projects that support workforce development and job creation. KEY TACTICS AND RESULTS: → RENT-FREE SPACE • 107,479 square feet of space given rent free to nonprofit organizations. • $603,096 in savings for nonprofits and their teams.

→ EMERGENCY SUPPLIES • $53,241 in essential supplies contributed to communities’ COVID-19 response. → DONATED ITEMS • 128,354 items donated in kind from property recycling events, plus an additional 55,950 pounds of materials donated for recycling and reuse. • Donations include $89,074 worth of construction items donated for reuse. → VOLUNTEER TIME • 25,909 hours of volunteer time donated by EQ employees. • 159 social impact events held across all properties. → FINANCIAL CONTRIBUTIONS • $521,600 contributed to charitable organizations.

2020 Social Week of Giving Impact Highlights

$53,705

360 Sign-Ups

70% of Employees

89 Employees

in economic value contributed to our communities, exceeding our $50,000 goal.

for volunteer events.

participated during the week.

participated in a volunteer event.

42 Team Members

$33,960

4 Customer Teams

made a charitable donation.

in charitable contributions and matching donations given to nonprofit organizations that EQ team members care about.

joined in volunteer activities.

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ESG Report 2019–2020

Social Impact Strategy & Results

2. Job Creation & Skills Training

In keeping with this same ethos, team members and customers benefit from educational and professional development through our EQ University training program and local resource groups like Women of Willis, which meets every other month. All of these engagement efforts were driven by employee requests. A company-wide survey of employees expressed above-industry benchmark satisfaction with EQ, but employees wanted even greater opportunities to share their ideas and develop their skills while informing company strategy.

EQ has placed job creation and skills training at the core of its efforts to serve as an economic engine for communities. Through our national impact partnership with nonprofit YouthBuild USA and collaborations with local workforce-development organizations like Project Pipeline in Chicago and The Doe Fund in New York, our teams are empowering a new generation of professionals.

KEY TACTICS AND RESULTS: → Created jobs through EQ’s unique design approach, spanning from construction projects to community partnerships, as well as co-creation with other organizations, like restaurants and retail.

→ Invested in employee engagement feedback, professional development training and events across portfolio properties and beyond.

51,293

87%

employee participation in employee-culture survey and engagement strategy planning.

jobs total.

41,672

jobs in public transportation and tourism.

$347,227

invested in professional development trainings attended by EQ employees.

31

art jobs.

$21,000

9,350

invested in EQ professional development events across five portfolio properties.

construction jobs.

$112,500

240

invested in providing job training for communities where EQ operates through charitable partners.

new retail jobs.

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ESG Report 2019–2020

Social Impact Strategy & Results

CASE STUDY:

Bringing Talent Development Into the Community In keeping with its mission to help companies attract, retain and inspire talent, EQ selected YouthBuild USA – the nonprofit support center for nearly 300 YouthBuild programs around the world – as its national community impact partner. EQ has committed to help YouthBuild expand the job-skills training, hands-on mentoring and internships it offers to opportunity youth – young adults between the ages of 16 and 24 who are neither in school nor employed – who wish to build a career in real estate or construction-related fields. In YouthBuild programs, students reclaim their education, gain job skills and become leaders in their communities. To date, YouthBuild has partnered with more than 180,000 young people to build brighter futures for themselves and their neighborhoods. EQ’s financial commitment and regular employee mentoring engagement helps YouthBuild champion opportunity

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youth as they earn the knowledge, training, and opportunities that lead to long-term personal and professional success. These young people receive their high school equivalency or diploma along with key industry credentials and certifications, life skills, post-secondary education and training, as well as experience building affordable housing and community assets. EQ has also committed to help secure at least five new internships each quarter for YouthBuild program participants, creating additional career pathways for industrious and inspired young talent.

EQ Office


ESG Report 2019–2020

Social Impact Strategy & Results

3. C ommunity Development & Integration

→ Increased economic activity by providing community access to new retailers, tourist attractions and public spaces that foster community.

We incorporate local art and community events into the life of every property with the goal of creating and supporting jobs in the creative community. These investments double in their impact by also serving as sustainable tourist destinations and local venues with character where customers socialize.

$79,437,352

KEY TACTICS AND RESULTS:

economic value brought to local communities through tourism, as verified by independent Economic Valuation Report prepared by Choose Chicago.

→ Invested in local arts to support thriving creative communities and anchor properties in a distinct sense of place.

97

pieces of art purchased.

→ Integrated properties into the daily life of their neighborhoods with the EQ repositioning process, bringing the “ivory tower” of the traditional corporate office to street level.

1

$3,559,815 in art investments across all properties.

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weekly farmer’s market.

1 2

new community art installations.

monthly performance group.

new renowned restaurant partnerships.

4

beekeeping engagement sites.

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ESG Report 2019–2020

Social Impact Strategy & Results

4. Health & Wellness Support Through a wide range of health and wellness programming, a subsidized fitness center and investments in outdoor community spaces, we foster the health of customers and the community as a whole.

23,549 People Benefitted From Subsidized Community Wellness

People (k) 15

13,759

KEY TACTICS AND RESULTS: → Subsidized gym memberships for community members and offered free access to fitness classes, community health events and wellness apps.

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5,470 5

4,320

$10,807,620 subsidized gym memberships available to community members.

0

$216,882

Mindfulness and fitness app downloads by EQ employees and customers

free fitness classes.

People attending fitness classes People using gyms

$156,108

invested in community health events.

$29,028 invested in providing access to mindfulness and fitness apps.

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ESG Report 2019–2020

Social Impact Strategy & Results

5. Responding to COVID-19

KEY TACTICS AND RESULTS:

The onset of the COVID-19 pandemic set crises into motion across many sectors, including commercial real estate. We doubled down on the critical need to ensure the safety of our employees, customers, partners and communities by taking careful steps forward. Customer engagement and feedback are core to our daily operations, and we were proud to see the vast majority of respondents to a survey of customers and partners found EQ’s handling of the pandemic to be responsive, informational and comprehensive. We were also thrilled to contribute over $73,000 to our neighbors and communities in need.

PLEASE PROTECT YOURSELF AND OTHERS AT US BANK CENTER

Wear a face covering in common areas at all times while on premises. Please cover your nose and mouth with cloth or fabric.

Wash your hands with soap and water.

Maintain six feet of physical distancing throughout the building [and garage, if appropriate for property].

→ Practiced consistent, transparent communication about confirmed cases, as well as cleaning and safety measures. → Delivered customer relief and resource information to all buildings in March. → Developed thorough safety protocols, signage and reminders to wear face masks, wash hands and social distance. → Delivered $53,241 of surplus essential supplies, including N95 masks, PPE and food, to first responders in our local communities across the country. → Shared comprehensive and consistent communication related to safe reopenings, including a COVID-19 Resource Manual. → Rolled out a digital suite of customer portals and apps for instant communication of crisis messaging. → Responded to 466 COVID-related inquiries.

Limit the number of passengers per elevator to two people.

Non-essential workers should not enter the building if you: • Have a cough, fever or shortness of breath or difficulty breathing, chills, muscle pain, sore throat or new loss of taste or smell. • Have traveled recently outside the U.S. • Have been in contact with someone suspected to have or diagnosed with COVID-19, or if you have been personally directed to remain quarantined.

If soap and water are not readily available, use an alcohol-based hand disinfectant stationed throughout the building.

Make Space For Greatness.

Signage for US Bank Center

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→ Sent out preparedness memos to all buildings in February.

→ 86% of customers felt their property teams overwhelmingly met expectations during the initial months of the COVID-19 pandemic, and 75% of customers were satisfied with EQ’s response. → Majority of customers reported that they are looking to EQ to lead them through the pandemic and provide safe opportunities for collaboration.

EQ Office


ESG Report 2019–2020

Social Impact Strategy & Results

6. Social Impact Benefits

KEY RESULTS:

Full- and part-time employees participate in a Volunteer Time Off program, receiving eight hours of paid time off to contribute to their communities as volunteers. EQ also matches employees’ charitable donations and offers grants to organizations where employees donate significant personal volunteer time. Property teams also host regular social impact events from coat drives to “bring your child to work day” and furniture donation drives for Habitat for Humanity. EQ teams work to incorporate customers into quarterly mentorship and job-training opportunities.

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25,909

hours of volunteer time donated by EQ employees.

159

social impact events held across all properties.

EQ Office


ESG Report 2019–2020

Social Impact Strategy & Results

CASE STUDY:

Community Development in Action: Transformation of South Wacker Drive When we acquired and began repositioning Willis Tower in Chicago, our $120-per-square-foot investment in this process set off a multiplier effect that drew in additional professionals, businesses, career opportunities and possibilities for the formerly depressed South Wacker Drive. Immediately, EQ’s investment funneled $160 million into labor for construction and skilled tradespeople, creating thousands of local jobs. Our team transformed building access to invite the tens of thousands of area residents and neighborhood pedestrians into Willis’ transformed public spaces. The lobby doubles as an art gallery with a global tribute to the galaxy and the sky from artist Jacob Hashimoto. Catalog, a 300,000-square-foot retail space with 20 restaurants and iconic art installations welcome passersby. Visitors often linger in the 30,000-square-foot rooftop garden, which opened to the public as the green heart of the neighborhood. Skydeck, a glass ledge with observation decks on the 103rd floor of Willis Tower, brings people to the property from around the world as one of the city’s top five attractions. An economic force for Chicago, Skydeck drove over $395,075,520 in business sales to the city this year between lodging, transportation, food and beverage sales, retail spending and tax revenues.

These initial outlays prompted other investments in surrounding buildings, with new lobbies and food stalls added to adjacent properties. Soon, more redevelopments, like Union Station’s restaurants and retail and The 78’s towers, high-rises and riverwalk sprung up, and developers transformed empty city college facilities into a Hilton Garden Inn. More community amenities, including fitness studios, retailers and parks, as well as improved sidewalks, public spaces and transportation contributed to the revitalization. New conference centers and community residents serve as anchors, offering small businesses in the neighborhood additional stability and growth.

The redevelopment also made Willis Tower safer with $75 million in elevator enhancements and innovative technologies that raised the property’s security rating to the highest available for a commercial office building in the country. With 125,000 square feet of customer-exclusive amenities and a 55,000-squarefoot conference area, the team increased Willis’ occupancy by 24%. 15

EQ Office


ESG Report 2019–2020

Social Impact Strategy & Results

SOCIAL IMPACT

Two-Year Goals for Preserving Local Culture Moving forward, we will continue to increase our efforts to develop the workforce, support local talent and make tangible contributions to the economic value of our neighboring communities.

These are our benchmarks for the next two years: → Provide job training and professional development for 50% more individuals. → Boost the number of community members benefitting from subsidized community wellness by 25%. → Expand customer → Increase total charitable engagement in contributions, which community events by 10%. include volunteer time, donated space and → Create 10% more new monetary and in-kind jobs in our communities. donations, by 25%.

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ESG Report 2019–2020

Environmental Strategy & Results

ENVIRONMENTAL

Regenerating Urban Spaces

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ESG Report 2019–2020

Environmental Strategy & Results

At EQ Office, we’re making quantifiable changes to the way we invest in and operate our properties to lower operating costs and advance sustainability-based management. These significant shifts enhance environmental efficiencies and allow EQ to deliver dramatic savings that we pass along to our customers and surrounding communities.

In the past year, we’ve invested $2,116,646 in environmental capital improvements that span every aspect of our operations. Thirty-two percent of our properties are LEED certified and 64.50% are Energy Star certified. We have made commitments across waste, energy, water usage, procurement, indoor air quality and resilience while training portfolio-wide Green Teams to keep us accountable.

Our Environmental Task Force developed these six standards to guide our commitments to sustainable business practices, as well as specific benchmarks and key tactics that underpin their implementation. With the dramatic reduction in costs we achieve by maintaining robust environmental standards, we’re reinvesting in the communities we serve every day and passing along savings to our customers.

Our 6 Environmental Standards:

1. Reduce Waste, Reuse, Recycle

2. Prioritize Sustainable Procurement

3. Reduce Water Consumption

4. Develop Environmental Resiliency Plans

5. Lower Energy Usage

6. Maintain High Indoor Air Quality

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ESG Report 2019–2020

Environmental Strategy & Results

1. Reduce Waste, Reuse, Recycle

→ Sought out additional opportunities to repurpose materials, including appliances, furniture and textiles.

We recognize the importance of eco-friendly waste management and set strong goals to reduce waste, repurpose materials and recycle across every EQ property. Our team prioritized ethical waste management, diverting 61.05% of construction-project waste from landfills in the past year and supporting composting initiatives in six locations. KEY TACTICS AND RESULTS:

$1,262,052 local materials reused in construction and decor at EQ properties.

$237,487

→ Maximized participation in recycling programs to the full extent that they are supported by local municipalities.

worth of items repurposed by local nonprofits. + 55,950 additional pounds of extra materials like holiday toys and e-waste.

Recycled Materials

Tons (k) 10 9

495.85

9,861.98 tons $204,839 in value

tons of materials composted.

= $41,972

8

in composted material value.

7 <insert bar graph on recycling statistics> 6 → Limited waste in supplies by supporting more conscious behaviors among customers and partners.

5 4 3

3,441.54 tons $4,659,419 in value

2

• • • •

19

1 9861.98 tons of materials recycled across 0 all properties $204,839.38 of recycled materials 3,441.54 of materials recycled across Alltons properties all construction projects All construction projects across $4,659,419 of recycled materials construction projects

100%

of properties held at least one environmental event this year.

63

recycling events held across all properties.

EQ Office


ESG Report 2019–2020

Environmental Strategy & Results

2. Prioritize Sustainable Procurement

→ Prioritized energy-efficient, locally sourced and low-emitting materials, such as low-VOC paint, as well as more efficient roofing and elevator operations.

Both our local properties and company-wide teams work diligently to select vendors and contractors who share EQ’s commitment to sustainable business practices. At every level, we prioritize sustainable construction and building materials. For example, this year, our team reused wood from Santa Monica Pier boardwalk for the walkway at our Playa District property. KEY TACTICS AND RESULTS:

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→ Sourced vendors with a commitment to sustainability across major trade areas from drywall to HVAC and lighting.

properties replaced their roofs to be more energy efficient.

→ Incorporated local cultural goods and art into new designs as often as possible.

20

properties (64.50%) made HVAC improvements.

$1,262,052

21

local cultural materials used in EQ properties.

properties (67.70%) improved landscaping to increase green space and optimize irrigation efficiencies.

$2,822,279

invested in art displayed at EQ properties.

$1,262,052

local materials reused in EQ properties.

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ESG Report 2019–2020

Environmental Strategy & Results

→ Developed Green Pre-Construction Checklist and Green Procurement Guide for all properties to complete and reference when making construction and vendor decisions. Our Green Pre-Construction Checklist ensures we are factoring in opportunities to purchase from local vendors and selecting partners who support our ESG goals, while our Green Procurement Guide provides a nationwide resource for our teams to find partners who share our commitment to sustainability.

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EQ Office


ESG Report 2019–2020

Environmental Strategy & Results

3. Reduce Water Consumption

4. D evelop Environmental Resiliency Plans

Water conservation is one of the most pressing challenges in many geographic areas where EQ operates properties. We’ve set new standards to reduce water consumption on an annual basis. This year we reduced use by 5.52%, saving $460,744 compared to the year prior.

As anchors for local communities, EQ’s properties are in a unique position to respond in times of crisis and safeguard people while prioritizing continuous operations during emergencies. Environmental resiliency plans are at the core of protecting our communities and our people, preventing avoidable damage and ensuring the most successful response to an environmental disaster. Most importantly, plans must be comprehensive and communicated with consistency. We have invested in ensuring each property evaluates its risk and is well prepared to respond to events and crises as needed.

KEY TACTICS AND RESULTS: → Investigated the property areas with the highest water consumption and replaced equipment, such as cooling towers and installing low-flow fixtures. → Leveraged water sub-metering systems to pinpoint anomalies in water consumption. → Used best-in-class, efficient water treatment chemicals.

Gallons (M) 200

→ Ensured all team members are protected from environmental hazards during and after an emergency; implemented environmental best practices in recovery efforts, such as hazmat cleaning.

160,496,444.96 gallons 151,637,041.20 gallons

100

→ Integrated recommended methods for understanding the risk horizon and preparing in advance for emergencies and their business impacts. → Cultivated and trained cross-functional teams across EQ to identify and respond to issues in real time.

Water Use for the Year

150

KEY TACTICS AND RESULTS:

100%

of EQ properties have an emergency response and natural disaster response manual.

50

$320,403

invested in emergency response communication systems.

0 2019 22

2020 EQ Office


ESG Report 2019–2020

Environmental Strategy & Results

CASE STUDY: VON KARMAN CREATIVE CAMPUS

Creating an Environmentally Engaged Campus Community in Orange County When EQ Office acquired Von Karman Creative Campus, the space featured hard divisions between campuses. Nine buildings were spaced on three distinct parcels of land with no connection points between them. EQ’s design team created a unified, dog-friendly campus with connected pathways, multiple outdoor conference rooms and a dog park. The center pathway is a quarter-mile long, and both customers and local residents often exercise along the pathway. EQ’s property management team coordinates walking groups and step contests, encouraging both work and play opportunities in the new space. EQ encourages its customers to join in its sustainability measures at VKCC: EQ sourced drought-tolerant native plants like Yucca Bright Star and Diosma Sunset Gold and hosted lunch and learns for all customers to share how to select and care for similar sustainable plants in their landscaping. EQ installed multiple bee hives in the parking lot and uses harvest times as opportunities for customer education events. EQ also brought in Booster Fuels to provide gas fill-ups on campus. Customers log on to their apps and request their cars be filled, taking hundreds of trips off the roadway. The practice also helps ensure no VOCs escape into the atmosphere with Booster’s re-invented supply chain.

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EQ Office


ESG Report 2019–2020

Environmental Strategy & Results

5. Lower Energy Usage

→ Ensured EQ pursues clean power wherever feasible, and where it is not, strived to purchase carbon offsets to deliver power with a net zero impact.

At EQ, we’re adopting clean energy and conservation practices that our teams continue to roll out at an aggressive pace. We are reducing energy consumption throughout our operations to reduce our impact on the environment and enhance the well-being of our communities.

Emission Savings 38.70% of portfolio participates in clean power programs

KEY TACTICS AND RESULTS: → Managed greenhouse gas emissions and implemented reduction opportunities across every aspect of operations. Emission Savings $ (M) 40 30

$28.45M 8.96% savings over previous year

20

→ Supported clean transportation with commuter assistance programs, which include bike tune-ups and education programs, as well as EV charging stations.

10 0 2019

2020

18

Energy Conservation Gains

EV charging stations installed at our buildings this year.

KWh (M) 4

$206,118

3 2

invested in EV charging stations.

204,512,169 −35.66% portfoliowide reduction

1 0 2019 24

2020 EQ Office


ESG Report 2019–2020

Environmental Strategy & Results

6. M aintain High Indoor Air Quality

→ Committed to quarterly air quality testing to gauge the efficacy of continued updates, as well as implement annual filter changes and coil cleanings.

Indoor air quality (IAQ) has always been a top priority for EQ; it’s essential to protecting the health and wellness of all customers and partners in our buildings. We employ industry-leading air quality measures, and now during the COVID-19 pandemic, we have made even greater investments in indoor air quality to ensure the safety of our communities. KEY TACTICS AND RESULTS:

$543,312

→ Invested in IAQ-related updates, from upgrading air filtration systems to MERV-13 filters and installing new flushing plumbing systems, to re-allocating engineering staff focus to air quality monitoring and maintenance.

invested in indoor air quality across all properties.

→ Increased run-time for HVAC systems and the circulation of outdoor air.

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EQ Office


ESG Report 2019–2020

Environmental Strategy & Results

We organized local Green Teams made up of EQ employees to implement these standards, benchmarks and practices. Green Teams drive company-wide adoption and host monthly trainings, helping us ensure that these practices become our new normal across every portfolio property. These teams also develop new sustainability tools, to help us meet and ideally surpass our 2021 and 2022 goals.

CASE STUDY:

EQ Environmental Standards in Action: 100% Wind Energy at Willis Tower

The 110-story Chicago landmark Willis Tower recently completed a $500 million renovation project. As a result of the renovation and energy efficiency upgrades, Willis Tower achieved a LEED Platinum certification. It’s the largest LEEDPlatinum certified building in the United States. To further commit to sustainability in day-to-day operations, the 26

Tower partnered with electricity supplier Dynegy to supply 100% of the building’s electricity from wind power. Customer costs will stay consistent, even as the Tower shifts to renewable energy. “Our partnership with Dynegy is one of the many ways we’re continuing our commitment to co-creating sustainable experiences in and around Willis Tower, and we’re proud to further EQ’s mission of making smart, green choices that improve the space around us,” said David Moore, EQ Office senior vice president and portfolio director. The initial three-year contract will save the building $60,000 as Willis Tower continues to prioritize sustainability in every aspect of its operations. Gabe Castro, senior vice president of business markets for Dynegy, adds, “For Dynegy, understanding EQ’s bold commitment to sustainability and EQ Office

its sweeping vision for the future was key to developing business solutions, and ultimately, a partnership.”


ESG Report 2019–2020

Environmental Strategy & Results

ENVIRONMENTAL

Two-Year Goals for Regenerating Urban Spaces We’ve set higher targets to ensure we further reduce our environmental footprint over the next two years. Meeting these benchmarks means that we can save our customers critical operating resources and invest our own savings into the community – training under-resourced workforces and creating additional jobs.

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EQ Office


ESG Report 2019–2020

Environmental Strategy & Results

→ Reduce energy consumption by 3% in 2021 and 5% by 2022.

→ Launch composting programs at 10% more portfolio properties.

→ Obtain IAQ certifications for at least 20% of portfolio properties.

→ Reduce emissions by 15% at all new portfolio properties within three years of acquisition.

→ Divert 45% of waste in operations; develop and implement plans to reach zero-waste targets.

→ Conduct risk assessments of 25% of portfolio properties.

→ Divert 70% of waste in construction.

→ Reduce water consumption by 5%.

→ Select 20% local procurement.

→ Opt into clean energy programs at 10% more portfolio properties and purchase $1 million in clean energy.

→ Reuse local materials in 25% of construction projects.

→ Commit to 15% green procurement in construction.

We’re setting the goal of saving $3 million total based on the above changes to our processes and new benchmarks.

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EQ Office


ESG Report 2019–2020

Governance Strategy & Results

GOVERNANCE

Driving Humanity into the Workplace

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EQ Office


ESG Report 2019–2020

Governance Strategy & Results

Experienced and visionary resources drive our processes, diligence and company management practices. As part of The Blackstone Group, the world’s largest private equity firm, EQ Office benefits from access to the top practice groups, global investment leaders and leading solutions for building management and operations. Our CEO Lisa Picard is a changemaker in the industry and leads EQ in transforming the future of work.

as a customer amenity with nationwide quarterly customer impact events and an annual Social Week of Giving, which provide unique opportunities for feedback.

Guided by these resources, our ESG Leadership Team ensures EQ management listens to diverse voices and prioritizes inclusive tenant engagement while centering the workplace around the human experience. Through an open and welcoming environment, we serve a common purpose united by our differences and embrace the authenticity that thrives at EQ. We include community mentorship and volunteering opportunities

Our organization also aims to serve as a trailblazer and thought leader in supporting talent and developing the infrastructure that empowers every individual occupant to deliver their best work. Widely recognized for our innovative approach to real estate development, we continue to make the news for our unique approach to inspiring talent. EQ’s core management principles include integrating ESG into our acquisition process, investing in tracking technology that will continue to strengthen the operations and safety of portfolio properties and building reporting systems that sustain ethical management and loss reduction.

Governance at EQ:

1. Diversity & Inclusion

2. Integrating ESG Into Our Acquisition Process

3. Customer Feedback & Engagement

4. Loss Reduction

5. Tracking & Reporting Technology

6. Thought Leadership

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EQ Office


ESG Report 2019–2020

Governance Strategy & Results

1. Diversity & Inclusion

→ DIVERSITY AND INCLUSION INQUIRIES IN VENDOR HIRING PROCESS: Using industry-validated directories of vendors for sourcing new partners on new projects, EQ now directs all property managers, construction teams and project owners to include minority-owned businesses whenever possible in EQ’s bidding process.

We believe that diversity in our management and throughout our company leads to better decisionmaking and stronger performance. Our Diversity and Inclusion program is a core component of our leadership and how we create more and better opportunities for all. We believe in a fair, equitable work environment that gives all people the opportunity to grow and thrive. We are committed to engaging diverse talent and partners through our hiring and partnership processes. We have invested in monthly diversity celebrations and Quarterly Community Circles, which provide a forum for addressing issues internally. EQ is also setting aside Juneteenth as an annual day of recognition, when we all honor the anniversary of the end of slavery in the United States through education, celebration and service.

→ MONTHLY DIVERSITY CELEBRATIONS: EQ properties help raise awareness and provide engagement opportunities in celebrating national recognition months, such as Black History Month, Pride Month, and Asian American and Pacific Islander Heritage Month. Each month, EQ properties provide speakers, lunch and learns, and educational content for customers that support the month’s diversity celebration. KEY RESULTS:

60%

of management selfidentifies as women.

FORMAL PROGRAMS:

65%

→ DIVERSIFIED RECRUITING, FAIR COMPENSATION AND INCLUSIVE MANAGEMENT: EQ has created new partnerships in local communities to expand our talent pool. We also focus on inclusion engagement and participation in talent reviews and promotions, requiring that hiring managers seek out and consider underrepresented minority candidates for every position. Our team ensures pay equality by never asking for previous salaries and, instead, sharing what EQ pays for a role. Leaders provide extensive mentorship for young women across the company once they’re hired, and women comprise one-third of our executive leadership team and hold key roles like vice president of technology and vice president of portfolio finance.

31

of staff self-identifies as women.

27%

of management selfidentify as minorities.

30%

of staff self-identify as minorities.

34.40%

of vendor partners are small businesses or minority owned.

$152,101,828

invested in minority-owned and small business partners, as verified by Dun & Bradstreet’s Supplier Diversity Data through vendor purchasing with certified minority-owned and small businesses.

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ESG Report 2019–2020

Governance Strategy & Results

2. Integrating ESG Into Our Acquisition Process Integrating ESG into our acquisition process pushed us to look at the social and environmental factors in prospective properties and re-examine our visioning and acquisitions process. Our team now conducts formal ESG audits of prospective properties, reviewing the social and environmental factors related to any acquisition in tandem with economic benefits. While evaluating new buildings, we intentionally consider ways to create jobs and increase the economic value we can bring to communities surrounding each property through our repositioning process. KEY TACTICS AND RESULTS: → Assessed opportunities to create additional social impact value for local neighborhoods. Creating green space, retail experiences and community spaces not only contributes to the value of the property but also gives neighbors the opportunity to benefit from a dynamic neighborhood, new jobs and higher property values. → Gauged the potential to align capital spending with both ROI and ESG values. Smart investments can lower the environmental impact of any acquired building, support neighboring businesses through procurement of locally sourced materials and improve the health and wellness of customers. → Evaluated the possibility to create new innovations in sustainability, social impact and governance. Implementing strong environmental practices and prioritizing minority-owned women-owned businesses from construction through operations can move the industry forward.

OUR PURPOSE: To build economic health in communities by regenerating urban spaces, preserving local culture, and driving humanity into the workplace. EQ ESG Guidance for Visioning & Acquisition As we have developed our ESG Program, we have been guided by a triple bottom line approach – adding programs and policies that not only enhance our profits, but also positively impact society and the environment. To best live our purpose and demonstrate the economic value we create for local communities, we want to ensure we incorporate our ESG Reporting Metrics into our Visioning and Acquisitions process. We see a strong intersectionality of these factors in our current approach to acquisitions but believe by codifying these as additional checklist items for consideration, we will surely post even stronger triple bottom line results. Key ESG/Triple Bottom-Line Indicators for Consideration (1) Opportunity to create additional social impact value for the local community by a. Creating new retail space that will not only attract customers and please customers staff, but also create additional jobs b. Creating/enhancing green space available to local housing or condo units, not only enhancing placemaking but also ultimately increasing property values c. Bringing in art installations or other attractions that will again not only enhance placemaking, but also increase foot traffic to retailers d. Offering community event space, that may be donated to community organizations from time-totime e. Making other enhancements that will support customers interest in the property and simultaneously drive job creation in the local community (both during repositioning construction and long-term) f. Making other enhancements that will be open to the public, thereby creating additional value for the community (2) Potential to align capital spending at asset with ESG ROI for an overall triple-bottom line approach, including a. Opportunities to drive energy/water/waste reductions b. Opportunities to use locally sourced materials and support local businesses (better design tied to local community, local culture) c. Opportunities to improve health/wellness with indoor air quality, fitness, and the like (3) Opportunity to further EQ thought leadership in sustainability, social impact and governance including a. Ability to facilitate recycling and composting of materials in both construction process and daily operations b. Opportunity to increase purchasing of clean power for building c. Ability to use construction teams with strong environmental practices and tracking/reporting mechanisms d. Ability to bring in vendors and partners with diverse workforces (minority-owned, women-owned)

Overall, considerations for social and environmental factors in any acquisition should be reviewed and considered in tandem with economic benefit.

EQ Acquisition Checklist Document

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3. Customer Feedback & Engagement Customer feedback, engagement and responsiveness are core to EQ’s everyday operations. Our property teams work as extensions of each customer’s teams, engaging in regular communication and offering multiple touchpoints every month. Through customer social, environmental, professional development, cultural and community events, we bring customers together and develop personal relationships with their team members. We respond to their needs and offer regular surveys for feedback. KEY RESULTS:

5,591

total customer events.

90.68%

average service rating across hundreds of customer service requests.

79%

of our customers believe EQ is doing a great job and nothing else is needed at this time.

66.67%

of customers would recommend EQ to a colleague.

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Governance Strategy & Results

4. Loss Reduction

5. T racking & Reporting Technology

At EQ, we lead with transparency and practice performance-management processes that reward due diligence. Systems like our Ethics Hotline, which is an anonymous hotline where employees and partners can report any suspected ethics breaches, encourage integrity in the workplace and prioritize loss reduction. EQ reintroduced this tool in 2020 and is supported by an external third party in ensuring diligent monitoring and reporting. Moving forward, we’ll report the following: • Total number of suspected ethics breaches. • Total number of ethics investigations. • Value of loss prevented through reporting of suspected ethics breaches.

We’re strengthening our tracking and reporting technology to automate monitoring and more rapidly address underperformance. New systems we’ve installed this year across select properties include: • Openpath Access Control System, ensuring touchless and even more secure building access. • Occupier movement sensors to analyze cleaning, occupancy and foot traffic. • Indoor air quality monitoring and reporting systems. • AI cameras and mass emergency communication systems. • Schneider Electric as our system of record for all buildings. • Blackbaud as our charitable engagement and tracking tool for community involvement. Our ESG Dashboard tracks all material issues across our portfolio and requires quarterly auditing across all properties with external review and validation.

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ESG Report 2019–2020

Governance Strategy & Results ISSUE

48

architecture interiors design culture

Through transparent communication and knowledge sharing, EQ not only builds accountability, but it also strives to lift up the commercial real estate industry. Supported by the resources and expertise of Blackstone, EQ regularly receives recognition and shares our talent-centered approach. KEY TACTICS AND RESULTS: → Developed new models for the industry by excelling in design, innovation, experience, sustainability and leadership.

This Changes Everything

6. Thought Leadership

SHAPE SHIFTER LISA PICARD IS LEADING THE TRANSFORMATION OF OUR WORKPLACES, ONE OFFICE AT A TIME. PLUS:

Oct 2019 issue of Gray magazine

Hank Willis Thomas Messgewand Philippe Nigro Faye Toogood x CC-Tapis Civilization Lenore Tawney Jean-Michel Othoniel

10

Barbara Kasten Burke Museum

awards received by EQ portfolio properties in the last year including:

Willis Tower • LEED Platinum (2019). • CTBUH Most Influential Tall Buildings of the Last 50 Years (2019). • Skydeck: TripAdvisor 2019 Top 10 Global Attractions. • Finalist Office Redevelopment of the Year, 2019 NAIOP Chicago Awards for Excellence.

100 Summer Street • LEED Platinum (2019). Playa District • Best Renovation at The Outstanding Building of the Year – TOBY Awards (2019).

800 Fifth Avenue • Recertified as LEED Platinum (2019). The Exchange • Recertified as LEED Platinum (2020).

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ESG Report 2019–2020

Governance Strategy & Results

→ EQ’s Willis Tower development team was recognized by Crain’s Notable Women in Commercial Real Estate (vice president of development Kirsten Ekdahl-Hull).

→ Shared our expertise and our portfolio properties in national and local media outlets.

→ Steered the industry forward with speaking engagements and keynote addresses that share EQ’s singular approach to creating economic value in local communities.

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EQ has been cited in 203 articles, and our business strategy has been featured in 41 media outlets, including: • The New York Times • The Washington Post • Travel + Leisure • USA Today • Eater LA, NY and Chicago • Business Insider • Gray magazine • Propmodo

speaking engagements and conference keynotes delivered by EQ employees, 11 of which were delivered by CEO Lisa Picard. Last year’s highlights include:

• Global Workspace Association. • Groundbreak (Procore). • Kellogg School of Management. • Stanford Professionals in Real Estate.

• NAIOP (Commercial Real Estate Development Association). • BOMA (Building Owners and Managers Association International). • New York Economic Club.

• ULI Chicago Women’s Leadership Initiative Signature Event. • MIT World Real Estate Forum. • CREtech Global Virtual Summit.

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Governance Strategy & Results

CASE STUDY:

Industry Thought Leadership in Action EQ’s CEO, Lisa Picard, has reimagined the power of commercial real estate to align with the future of the workplace. “We used to build buildings as a statement and a monument to the corporation, because the corporation had to impress upon its clientele that it had longevity, that it had strength, that it had power,” Picard told Gray magazine. “Today it’s really about the generation of ideas. And to generate ideas, you need to attract talent who believe they can be a part of something.”

For Picard, nurturing talent begins with creating spaces that adapt to human beings rather than the other way around. She’s guided EQ to transform generic office buildings into dynamic gathering spaces for collaboration, community and creativity across the country. These buildings open to, rather than close off, workspaces from their neighborhoods, contributing to both urban revitalization and cultural preservation. Picard’s leadership ensures that every portfolio property attunes to the unique pulse of the local neighborhood. As the company expands its ESG program, Picard is breaking new ground in continuing to envision the way EQ can serve the common good.

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Governance Strategy & Results

ESG Leadership This year, 35% of the company worked on a task force to develop our formal ESG program. These efforts included seven to 15 hours of meetings each week. Nine committees spent more hours preparing and following up on those meetings. ESG leads met monthly and communicated weekly about progress in these task forces and committees. Every participant put in these hours with enthusiasm and excitement, in addition to fulfilling their full-time responsibilities.

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Governance Strategy & Results

A SPECIAL THANK-YOU TO OUR LEADS:

A SPECIAL RECOGNITION FOR ALL ESG TASK FORCE MEMBERS AND SUPPORT TEAMS:

LEADERSHIP AND VISION Charlie Hobey Lauren Sozio

ENVIRONMENTAL Aaron Rudock Allison Goerler Amy Baker Angela Liu Beck Papraniku Bob Casey Brenda Kipling Carolyn Harrington Clayton McFadden Colleen Ballinger Cory Sandel Deborah Schaan Denna Byron Frank Bellina Fred Cook Gary Michon Hugo Lazo James Grogan James Wessels Jared Cohen Jenalyn Rogers Jennifer Bowman Katherine Bartels Kevin Akers Kevin Sullivan Lauren Bellard Lisa Foyston Lupe Velazquez Mackenzie Straughan Maggie Tamuleviz Marisol Olvera Mary Valenzuela Matt Watson Mike Becker Natalie Barba Natalie Copley Ny Love Perla Robinson Robbie Hurlbert Robert DelHierro Robert Rogers Rodel Salvio

STRATEGY AND IMPLEMENTATION Laura Probst COMMUNICATION TEAM Angela Liu Jim Anderson Rosabel Tao Riley Insko EXECUTIVE SPONSORS Lisa Picard Frank Campbell

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ENVIRONMENTAL Dan Murphy Kirsten Ekdahl Hull SOCIAL IMPACT Diana Hernandez Joanie Edgerly GOVERNANCE AND TECHNOLOGY Brenda Haraldstad Mikki Ward

Sara Connelly Sophia Pagan Terry Jackson Todd Mott Tom Bryant SOCIAL IMPACT Angela Liu Antoinette Polanco Brigid Doherty Caitlin Biere Eric Temp Ian Ritchey Jaime Lane Jason Bouthillette Jazmine Okongo Jim Anderson Katrina Jones Kelly Kramer Keri Dunkelberger Lisa Salvio Marlene Gomez Pam Deegan Sophia Pagan Spencer Rose TJ Kelley GOVERNANCE Beck Papraniku Brenda Haraldstad Carolyn Harrington Debbie Zehm Dimitry Dubov Katrina Jones Lydia Jordan Parnell Marisa Francis Minh Nguyen Nick Johnson Nicki Sautel Rachel Mitz Tena Cameron Vivienne Kwong


ESG Report 2019–2020

Governance Strategy & Results

GOVERNANCE

Two-Year Goals for Driving Humanity Into the Workplace As we look ahead, we are committed to excellence in our inclusive and transparent culture, thorough care in our diligence and innovation in our contributions to the industry.

Our specific two-year goals include: → 100% reporting on quarterly EQ ESG dashboards.

→ At least 90% favorability in responsive communications.

→ Incorporate Diversity and → 100% prevention of Inclusion (D&I) standards reported potential ethics in 75% of vendor search breaches. processes. → At least 85% favorability in likelihood of employees, partners and customers to recommend EQ to a colleague or industry peer.

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ESG Report 2019–2020

Reporting Methodology

Reporting Methodology We constructed the 2019–2020 ESG Report with data collected from the 40 properties in our portfolio as of July 31, 2020. This report covers data between August 1, 2019 and July 31, 2020.

In preparing this report, we focused on the following core principles: • • • •

Stakeholder Inclusivity Materiality Transparency & Completeness Data Quality & Reliability

→ STAKEHOLDER INCLUSIVITY: We included a broad spectrum of stakeholders in our ESG Report development process, including employees, customers, vendors, community partners, investors, economists and third-party ESG and data evaluation experts. We engaged these participants in interviews, written surveys and working group meetings. Our ESG task forces met weekly with oversight from our ESG leadership committee and our executive sponsors, as well as members of Blackstone’s global ESG team.

→ TRANSPARENCY & COMPLETENESS: We communicated regularly with stakeholders about our process, our data collection and our results. Our team has included all of these collected findings in the report. → DATA QUALITY & RELIABILITY: Together with key stakeholders, we created a comprehensive ESG audit questionnaire and required 100% reporting from all properties in our portfolio. Each task force interviewed managers responsible for reporting and reviewed the collected data. We then validated the provided data against multiple sources, including: • Third-Party Systems and Records (Utility Providers, Vendor Tracking Systems and GRESB and LEED Certification Records, etc.) • Our Audited Corporate Financial Records • External Vendor Databases (Better Business Bureau, etc.)

→ MATERIALITY: We conducted a comprehensive and systematic materiality assessment to determine and prioritize our material issues. Our assessment involved interviews, data and documentation review across all core activities. We examined global trends that impacted our business and interested our stakeholders while completing a thorough review of all processes.

After our task forces collected the validated figures, each member of our ESG leadership committee reviewed the collated data, with additional efforts made for third-party verification and validation. We reported on all these efforts, including the methodology for review and calculations.

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ESG Report 2019–2020

The Road Ahead

The Road Ahead: Our Two-Year Targets We are proud of all we have accomplished in formalizing our ESG Program and producing our first annual ESG Report. We look forward to tracking our progress against our full scorecard of two-year performance targets and sharing our results. Here are the highlights:

→ Reduce energy consumption by 3% in 2021 and 5% by 2022.

→ 100% reporting on quarterly EQ ESG dashboards.

→ Reduce emissions by 15% at all new portfolio properties within three years of acquisition.

→ Incorporate Diversity → Provide job training and Inclusion (D&I) and professional standards in 75% of development to 50% vendor search processes. more individuals.

→ Reduce water consumption by 5%.

→ Create 10% more new jobs in communities.

→ Boost the number of community members benefiting from subsidized community wellness by 25%.

→ Divert 45% waste in operations; develop and implement plans to reach zero waste targets.

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→ 100% prevention of reported potential ethics breaches.

→ Increase total charitable contributions, which include volunteer time, donated space and monetary and in-kind donations, by 25%.


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