PS1: Assessment and Management of Environmental and Social Risks and Impacts

PS2: Labor and Working Conditions

PS3: Resource Efficiency and Pollution Prevention

PS4: Community Health, Safety and Security

The location of the assets is adjacent to existing urban and/or industrial designated areas with typically no impacts on indigenous peoples, cultural heritage, or biodiversity. Therefore PS6, PS7 and PS8 are not considered applicable. In relation to land acquisition (PS5), assets acquired both historically and currently are already developed. Nonetheless, and as part of Grivalia’s due diligence process, the company does a screening against any land related legacy issues to ensure land acquisition complies with national regulation. The company is not planning any greenfield construction in the near future.

If IFC’s investment proceeds, IFC will periodically review the project’s ongoing compliance with the Performance Standards.

This is a category B project according to IFC’s Policy on Environmental and Social Sustainability because a limited number of specific environmental and social impacts may result that can be avoided or mitigated by adhering to generally recognized performance standards, guidelines or design criteria as is described in the following sections.

Key environmental and social issues reviewed during this appraisal include: (i) effectiveness of the company's management systems, including its internal capacity and staffing, to undertake its operations in a manner that is consistent with IFC Performance Standards; (ii) contractor management  to ensure provision of fair, safe and healthy working conditions during construction and operations; (iii) consistent application of pollution control measures during design, rehabilitation and upgrade work, and operations; (iv) design of the proposed projects taking into account life and fire safety considerations for public access buildings and incorporation of energy efficiency measures; (v) ensuring rehabilitation and upgrade work nuisance to adjacent or nearby communities is minimized; and, (vi) active periodic external E&S (include labor) monitoring and reporting is undertaken.

 IFC’s appraisal considered the environmental and social management planning process and documentation for the Project and gaps, if any, between these and IFC’s requirements. Where necessary, corrective measures, intended to close these gaps within a reasonable period of time, are summarized in the paragraphs that follow and (if applicable) in an agreed Environmental and Social Action Plan (ESAP). Through implementation of these measures, the Project is expected to be designed and operated in accordance with Performance Standards objectives.

Environmental & Social Assessment:

Grivalia owns over 1,174,164 m2 of land and 776,839 m2 of buildings such as retail, logistic, office and related infrastructure areas in Greece. Grivalia has implemented an assessment process which is followed prior to purchasing an asset, and updated as necessary on an annual basis. The company performs a legal and technical due diligence of potential issues which includes assessment of land titling and ownership, structural safety, fire safety, and environmental compliance. Grivalia purchases both types of assets through willing-buyer willing-seller transactions and through liquidation and auction sales. The company follows local legal requirements for design, development and construction of asset developments, including the specifications defined by the municipal government, the requirements defined by the Ministry of Environment and the new National Building Code of Greece which came into effect in 2011. An accredited engineer endorses the design, including structural and fire safety aspects, as is required by legislation and regulations in force, before it is submitted for the local authority to obtain the relevant certificate and building permits.

In case of any rehabilitation or refurbishing project, Grivalia will commission an Environmental Impact Assessment (EIA) and obtain the required environmental and additional permits prior to commencement of works, as applicable by legislation and regulations in force. Prior to beginning occupancy by tenants all buildings will have all permits obliged by national law up to date. In general, rehabilitation or refurbishing contracts, are outsourced on the open market via competitive bid processes with works being completed in a manner consistent with national legal requirements, which are aligned with European Union (EU) legislation and meet good international industry practice. As per the ESAP (item #1), Grivalia will update its environmental and social policies and procedures, including the process of assessing and managing environmental and social aspects during asset acquisition and development in a manner compliant with IFC’s Performance Standards.

Management Systems:

Grivalia has a sustainability strategy and plan focused on improving its portfolio sustainability through an efficient management of financial, social and environmental risk and opportunities. This plan is divided in three phases as follows: (1) Phase 1: improve policies and procedures, establish sustainability committee, collect portfolio data, and obtain LEED certifications; (2) Phase 2: enhance tenants and supplier sustainability management, improve monitoring and recording energy consumption, action plan to improve energy efficiency and waste management, and issue a Sustainability report; (3) Phase 3: Capex to improve energy efficiency and waste management. IFC’s appraisal focused on Grivalia’s existing management systems and procedures. The company has a Health & Safety Policy and an Environmental Policy in place aligned with EU legislation and is committed to strengthen these in line with IFC Performance Standard 1 (ESAP #1). The environmental policy includes a statement to implement energy and resource efficiency practices at design, rehabilitation or refurbishing, and management of assets. Throughout Grivalia’s two main activities: (i) as a building and facility manager, and (ii) as an asset owner; the company has identified the processes to be followed to acquire, refurbish, rehabilitate, and manage assets in a manner in line with national legislation. These  policies cover key activities expected at acquiring, rehabilitation, refurbishing and managing assets, including: (i) land acquisition screening to ensure land and/or asset acquired does not have liabilities; (ii) fire and seismic safety of buildings; (iii) emergency preparedness and response plan (EPRP) for managed assets; (iv) occupational health & safety procedures for rehabilitation and refurbishing (done through contracts signed with Grivalia’s contractors), maintenance and operation (done by providing tenants with E&S best practices guidelines); (v) monitoring of environmental aspects, including electricity, oil/gas, water use and where possible/applicable, solid waste and effluents. These is currently done in a few assets and will be expanded to the whole portfolio as part of the ESAP #1. Some of these identified policies specify the activity and explain roles and responsibilities, referencing the applicable legal standards. Grivalia has identified that limited guidance is still provided to tenants and contractors, and is engaged in improving understanding of EHS aspects and performance at this level. 

Grivalia is engaged in improving the resource efficiency of its assets and has used so far LEED (Leadership in Energy and Environmental Design) as a green building certification scheme for improving how buildings are refurbished, rehabilitated, maintained and operated. Currently they have 3 buildings certified, and 3 under certification procedure either by LEED of by BREEAM. This is still a small percentage of its portfolio and Grivalia is exploring other certification options, such as IFC’s EDGE, for some of its assets. As part of its engagement on green buildings, and only for its tenants in buildings that are LEED certified, Grivalia includes specific guidance on energy and resource efficiency as part of the contracts, called “Green Policy”. As set forth in the ESAP (item #2), going forward Grivalia will ensure that this policy is included as guidance in all lease contracts.

Organization:

Grivalia has both a Technical department (TD) and Portfolio management department (PMD) which have the responsibility to manage the Health, Safety and Environment (EHS) aspects at its operations. Part of its functions include: (i) coordinating the EIA studies for any new projects; (ii) environmental permitting and LEED certification; (iii) verification of life and fire safety status of assets; (iv) water, and waste monitoring.

At rehabilitation and refurbishing sites Grivalia ensures that its contractors appoint an EHS officer. In cases where Grivalia manages the asset, it will directly appoint an EHS officer when such an obligation exists by legislation and regulations in force. In addition, at each rehabilitation or refurbishing operations, the engineering department staff participates in safety briefings, observe safety practices, and check contractor records (OHS statistics, etc.) on a regular basis. Any findings are recorded on a standardized form and followed up in future visits.

Emergency Preparedness and Response:

Life and fire safety (LFS) and local seismic activity are the main operational risks associated with the company’s real estate development and operation management. Grivalia has a process on emergency preparedness and response which also provides guidelines for the company’s managed assets as well as through contracts with tenants and contractors as determined by national legislation. As per national legislation, each rehabilitation, refurbished or managed site prepares a specific emergency response plan. Regular drills are conducted for staff. The visited sites had identified emergency assembly points, signs guiding towards the assembly points, first aid, and display of emergency contacts.

Monitoring & Reporting:

As part of its management system and processes, Grivalia’s appointed EHS officers monitor the operations on-site regularly. All findings are documented and reported and any gaps are supervised for completion by the EHS officer on site and the technical department. The LEED certified sites conduct environmental monitoring for parameters including water and energy use. As set forth in the ESAP (#1), Grivalia will improve its monitoring efforts to include all assets and additional EHS parameters such as: waste, and wastewater quality (industrial). Based on the analysis of the reports, the technical department should send feedback to site EHS officers to strengthen EHS performance on site.

Grivalia employs 28 direct employees in Greece. These staff is responsible for the main operations including acquisition, management and maintenance of assets. The company uses a variety of contractors (approximately 10) for specific activities such as construction, maintenance, security and gardening.

Human Resource Policy Management:

The company has a Human Resource (“HR”) policy and operational procedures based on Greek labor law requirements. A HR Manual has been produced which documents the terms of employment, policies and procedures for recruitment, compensation and other benefits, training, performance appraisal, and promotions. All Grivalia’s employees have access to the HR Manual.

Working Conditions and Terms of Employment:

Grivalia provides working conditions and terms of employment in accordance to the national Labor Code and IFC Performance Standard 2. Working conditions and terms of employment – including type of employment contracts, working hours and overtime arrangements, wages and overtime pay, benefits, rest days, holidays, leave, access to training, performance evaluations, disciplinary procedures, and OHS provisions – are documented and communicated to workers at the time of employment. Most of the construction and general maintenance work is managed through contractors. These are established businesses with specific expertise. Grivalia contracts a total workforce of approximately 300 workers for all its operations in Greece. These workers are hired directly by contractors and all labor practices are in line with national requirements. As set forth in the ESAP (#3), Grivalia will ensure that PS2 requirements, including a grievance mechanism, are incorporated into contractual agreements with contractors and subcontractors also during construction and maintenance phase. The minimum age for employment under international standards and Greek Labor Law is 18 years of age, including construction. In compliance with national labor laws, the company requires contractors to check on the age of all workers hired.

Workers’ organizations:

Although there are no unions at Grivalia, employees are free to voice their opinions and concerns via direct supervisor or the human resources department. Issues can be escalated to higher levels within the organization as and when needed.

Occupational Health and Safety:

Health & safety at rehabilitation, refurbishing and managed is a key priority for Grivalia. The company has developed a Health & Safety (H&S) policy, which describe H&S aspects during rehabilitation, refurbishing or management of assets. The company requires contractors to obey H&S requirements as part of its contract agreement. For suppliers and tenants, Grivalia asks for commitment to take all necessary measures towards effective H&S practices.

Grivalia continues to monitor H&S statistics for each of its rehabilitation, refurbishing and managed operations. Safe work procedures have been developed based on a job hazards analysis, and training is available to workers after hiring. Personal protection equipment (PPE) such as hamlet, safety boots is supplied to all staff working on rehabilitation and refurbishing sites, including contractors. No health & safety concerns nor gaps were identified during the site visits.

Environmental aspects during rehabilitation, refurbishment and management of the company’s assets are identified during the assessment process. Impacts during rehabilitation, refurbishment and management, are mainly related to solid waste and wastewater management, noise and dust impacts. These EHS aspects are managed and monitored by the technical department and implemented by contractors in cases of rehabilitation and refurbishment.

Resource efficiency:

As part of its strategic plan, Grivalia has a special emphasis on resource efficiency specifically on energy and water consumption. IFC's assessment focused on the company's operations with regard to resource efficiency practices (water, energy and fuel), and efforts to optimize resource use, waste minimization and overall environmental management practices.

The company is continuously assessing its assets using an “energy checklist” to find opportunities to improve energy and water efficiency. Additional initiatives include LEED certification of some of their assets and exploring new opportunities to implement specific resource efficiency measures including the use of T5/CFL/LED lighting, thermal insulation for roofing, natural cross-ventilation, solar water heating systems, and LED lighting in public areas. For LEED certified assets the company has reduced energy consumption by 30%.

Water supply during rehabilitation, refurbishment and management of assets is provided through the municipal network and the company monitors the quality of water from the network to ensure it meets national requirement levels (EU requirements). Currently, domestic wastewater is discharged through the municipal wastewater system.

In Grivalia’s managed assets, waste is segregated on site, divided into domestic waste (e.g. offices, canteen), and hazardous waste, such as oily waste and containers, used filters, and lighting bulbs. Contracts are already in place with licensed waste management and hazardous waste management companies for the collection, treatment, and disposal of waste.

Greenhouse Gases (“GHG”):

The main source of GHG emissions comes from the energy used in assets. Current operations produce approximately 81,000 tCO₂e per annum. GHG emissions monitoring is required for all business that produce emissions of greater than 25,000 tCO₂e per annum and Grivalia will provide GHG figures to IFC through its Annual Monitoring Report.

The company acquires assets and meets all local structural, seismic, and fire safety standards and regulations. Greek regulations in this area is aligned to EU standards and meet the requirements of IFC Performance Standard 4. The process to meet life and fire safety regulations in existing building includes: (i) Grivalia’s due diligence process done by a qualified professional in the technical department; (ii) identification of gaps with design and/or national requirements; (iii) implementation of corrective measures to close gaps; (iii) obtain or ask tenants to obtain fire safety certificate through national government agency; and (iv) have fire safety staff at all managed assets and yearly drills. For all current assets, Grivalia has undertaken a LFS review (against national code) to assess the risk in its portfolio. Identified gaps are addressed through refurbishing or improving operation of assets.

Smoke detectors, fire extinguishers, sprinkler systems, fire alarms and sand buckets were available in the sites visited. Grivalia has a specific process on maintenance and use of firefighting systems. Maintenance is done by a specialized contractor and coordination is done by the company’s technical expert responsible for managing the work of maintenance contractors, reviewing systems testing and conducting monthly internal audits. At each rehabilitation, refurbished or managed site, the EHS officers are also responsible for LFS aspects on site and conduct daily walks to identify unsafe practices which are reported to the asset manager. These EHS officers coordinate regular fire drills and training on the use of these firefighting systems. In cases where Grivalia does not manage the asset, it is the responsibility of the tenant to maintain these firefighting systems and train their personnel.

The company maintains good relations with local communities and its customers (tenants). There are no material concerns raised previously for the completed construction sites and managed assets. Interested parties, including contractors, can share their concerns with the local authorities who will follow-up and provide feedback directly to Grivalia. As part of this investment and as set in the ESAP (#1), the company will develop a formal grievance mechanism and will post boxes at strategic locations around its developments.