The EU Sustainable Finance Disclosures Regulation (2019/2088) on sustainability-related disclosures in the financial services sector (the “SFDR”) requires New York Life Real Estate Investors, a division of NYL Investors LLC (the “Manager”) to publish information on the integration of sustainability risks in its investment decision making process and the consideration of adverse sustainability impacts. The Manager manages real estate focused funds. The following disclosures apply only in respect of those funds managed by the Manager that are subject to SFDR.
SFDR defines “sustainability risks” as environmental, social or governance (“ESG”) events or conditions that, if they occur, could cause an actual or a potential material negative impact on the value of the investment. The Manager is committed to act in the best interests of its clients. In this fiduciary role, the Manager believes in taking a holistic view of an investment opportunity. The potential impact of various sustainability risks on an investment will differ by company, sector, geography, asset class, and the passage of time. For real estate equity investments, and if appropriate for a debt investment, the Manager will conduct sustainability risk-related due diligence and/or take steps to mitigate sustainability risks in an attempt to preserve the value of an investment.
For further information on the Manager’s ESG+R approach, please see the following link: https://www.newyorklifeinvestments.com/who-we-are/our-global-boutiques/nyl-investors/real-estate-investors/esg
Consideration of Adverse Sustainability Impacts
Adverse impact under SFDR is the risk of harm that an investment decision may have externally on sustainability factors. Sustainability factors are defined under the SFDR as environmental, social and employee matters, respect for human rights, anti-corruption and anti-bribery matters. For the time being, the Manager does not consider the adverse impacts of its investment decisions on sustainability factors, within the meaning of Article 4(1)(a) of the SFDR and the technical standards made under the SFDR in relation to the funds that it makes available in the EU. Among other reasons, this is because obtaining and/or measuring all the corresponding data systematically, consistently, and at a reasonable cost with respect to all investment strategies has not been standardized. Instead, the Manager considers whether to conduct adverse sustainability impact related due diligence as part of its investment decision-making process on a more bespoke basis and/or in taking steps to mitigate sustainability risks in an attempt to preserve the value of an investment. Depending on the availability of relevant data, the Manager intends at a later stage to consider disclosing on a voluntary basis where it considers the adverse impacts of its investment decisions on sustainability factors and where it has relevant data aligning with SFDR standards and will update this statement accordingly.
While the Manager may report information relating to data corresponding to its ESG+R approach in some of its funds to investors, this may not align with data requirements under the SFDR and its technical standards.
In addition to traditional financial metrics, remuneration of the Manager’s personnel is also calculated using non-financial metrics and performance indicators. The Manager is not subject to Article 5 SFDR with respect to remuneration.