For Ventas, Inc. (NYSE: VTR), renewing, updating, and adding sustainability goals on an ongoing basis is an integral part of its operating strategy and key to ensuring that the health care REIT is setting the highest possible standards for housing a large and rapidly expanding population of older citizens.
The 80-plus population in the United States is expected to grow by approximately 24% over the next five years–from about 14 million in 2024 to about 18 million in 2029.
In 2024, Ventas set forth its latest corporate sustainability goals that were based on a refreshment of its materiality assessment carried out the prior year. Those goals include new key performance indicators (KPIs) to enable Ventas to monitor and report its progress to stakeholders.
Given its ongoing commitment to sustainability goals, Ventas was recognized as Nareit’s 2024 Leader in the Light Award winner in the health care sector. It is the REIT’s eighth win in the awards, which recognize REITs that demonstrate leadership in sustainable and socially responsible investment and operating practices, good governance, and transparency.
Kelly Meissner, vice president of corporate ESG and sustainability at Ventas, notes that the updated goals “continue to demonstrate the important ties between our sustainability work and our business success, such as a focus on water efficiency in our senior housing operating portfolio (SHOP), which represents 80% of our portfolio water consumption.”
Ventas is now targeting a 20% reduction in water efficiency between 2022 and 2030. Having already reduced water intensity by 5.3%, Ventas has identified this as an area for increased focus and is rolling out water efficiency technologies based on more aggressive pilot programs.
Smart irrigation systems are now active at more than 50 senior housing communities. At the same time, the REIT has established customized water efficiency measures at more than 100 properties since 2023. These involve options such as low-flow fixtures, toilet retrofits, water meter technology, and automatic leak detection. Combined, they reduce water consumption and costs by 40% or more and significantly mitigate the risk of damage from water leaks.
“There’s a real business opportunity here to increase our efficiency,” Meissner says.
Ventas’ innovative and scalable approach toward creating property-specific net zero roadmaps by using machine learning, AI, and physics-based modeling earned it a Nareit 2024 Sustainability Impact Award in the impact at scale category, which Meissner spoke about at Nareit’s REITworks: 2024 Sustainability & Social Responsibility Conference.
Among its broader set of revised environmental goals, Ventas is now pursuing 80% of energy consumption from electricity by 2030, which aligns with the REIT’s broader net zero goal. A new renewable energy goal, meanwhile, seeks to achieve 60% zero-carbon electricity by 2030 and 100% by 2035.
Meanwhile, a reduction in energy use intensity of 25% from 2022 to 2030 is among the updated goals. At the same time, Ventas has set a new goal to maintain voluntary employee retention at or better than 90% annually.
As the world’s second largest owner of senior housing, Ventas’ sustainability strategy is aligned with advancing its “critical mission” of enabling exceptional environments that help older Americans, Meissner says.
To further support that mission, Ventas is also incorporating physical climate risks that could threaten its properties, residents, and tenants, into a holistic corporate risk framework. This framework takes on greater significance because of Ventas’ focus on America’s aging population.
“In a rapidly growing longevity economy, this work is more important than ever,” Meissner points out.
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