The magnitude of climate-related risks that affect physical assets, business operations, and personal safety tripled to 27 in 2024, according to data from the National Centers for Environmental Information. Incorporating climate risk assessments and resilience measures into asset management plans and capital expenditure cycles across entire portfolios is critical to protect investments and people in the face of increasingly volatile storms, rising sea levels, and extreme temperatures.
A panel of experts, moderated by Katie Wholey, director community resilience and climate at Enterprise Community Partners, gathered at the 2025 ULI Resilience Summit in Denver to discuss how climate risk assessments are informing asset and portfolio management. Panelists included Ross Beardsley, managing consultant, Ramboll; Gretchen Hancock, managing director, Global Infrastructure Partners, a part of BlackRock; Reid Morgan, Americas-focused member relations manager, GRESB B.V.; Kimberly Pexton, senior vice president of sustainability, JPB SMITH Properties; and John Thigpen, vice president of sustainability services, JLL.
(The Unfound Door)
A panel of experts, moderated by Katie Wholey, director of climate resilience at Enterprise Community Partners, gathered at the 2025 ULI Resilience Summit in Denver to discuss how climate risk assessments are informing asset and portfolio management.
“We’re in the earlier stages of climate risk assessments,” says Reid Morgan, Denver-based director of member relations, Americas, for GRESB. “Many companies are doing them in response to institutional investor demand, often [from] pension funds. The pivot will come when fund managers start to see that this exercise is not just about satisfying investor demand, but that it’s [also] starting to protect them from higher costs and actual damage to their properties and adding value to their assets when they decide to transact.”
Making climate risk assessments actionable
Kim Pexton, senior vice president of sustainability at JBG Smith, is leading the charge to update the company’s climate risk assessment and develop a materiality threshold that can inform the company’s climate risk management strategy.
Climate science modeling is “moving at lightning speed,” Pexton says. JBG Smith used S&P Global’s Climanomics tool, which found that extreme heat, flooding, and carbon taxes stemming from building performance standards were the greatest climate risks to their assets, all of which are in the Washington, D.C. region. The outputs from that tool can be incorporated into enterprise risk management efforts and can be used to inform site selection, investment, and disposition planning, as well as risk mitigation planning, she says.
At JBG Smith, Pexton and consultant JLL used a simple four-square analysis in comparing costs and risks to inform their asset management and capital expenditure planning.
“Anything green is either an insurable event or has a low investment cost to fortify against,” says consultant John Thigpen. “Anything in a yellow or red box [is] not insurable, so that’s where mitigation strategies and measures really need to happen.”
Including the insurance team during this exercise is critical, Pexton believes. Janika McFeely, vice president of climate and decarbonization at JLL, agrees: “For many companies, it makes sense to first look at what their insurance covers and what it doesn’t . . . . The next step is to find out how to mitigate potential problems that insurance won’t cover.”
To identify potential risk reduction measures, Thigpen suggests that companies lean on ULI’s developing resilience toolkit, which includes a comprehensive list of risk reduction strategies organized by climate hazard, as well as the co-benefits each strategy brings.
Internal staff members—rather than third-party consultants—are typically better equipped to triage which buildings or features to prioritize, Thigpen says. “They need to look at what a repair or retrofit might cost and estimate the reduction in operating revenue while a building is closed, if a climate event occurs,” he says.
Potential risk reduction and building performance measures are evaluated via such metrics as whether they’ll increase net-operating income, whether they’ll increase tenant retention, and whether the property value will increase at the time of sale, Pexton says.
Risk management at scale
Companies with a wide-ranging portfolio face more complex assessment needs. “Global Infrastructure Partners [GIP] is a private equity firm focused on investing in infrastructure assets such as ports, rail lines, airports, energy producers, data centers, and water and waste-management businesses,” says Gretchen Hancock, a managing director at GIP, a part of BlackRock in New York. “Our investors are looking for stable, long-term returns, which underscores the need for resilience, so we look at how to prepare these critical assets for longevity.”
For Hancock and others looking at risk on a global scale, the framework generally starts on a property sector basis.
“We look at which climate hazards create the highest level of risk for each property sector and create a matrix,” Hancock says. “For example, ports are most at risk from sea level rise and flooding, while extreme heat can impact productivity at a wind farm. Then we map geographically to understand which hazard is most likely to impact our assets.”
Assessments need to identify both climate and asset risks. “For example, if most of the critical elements of a property are underground, that may make it more resilient in a tornado, but not in a flood,” Hancock says. “We also look at the network of dependencies and drive conversations with entities we don’t control. For example, we need to understand the resilience measures utility companies are taking to make sure the power gets to a compressor station or to an airport.”
Global Infrastructure Partners worked with Ramboll, a consulting firm, for its climate risk assessments.
“Ramboll’s HazAtlas tool helps property owners, developers, and investors understand what hazards they’re exposed to now and how that may change in the future, such as the potential for sea level rise,” says Ross Beardsley, a Bay Area–based senior managing consultant at Ramboll who leads climate change risk assessments. “Then we slowly layer in more information, including financial and operational information to identify the most relevant hazards and the most important assets in a portfolio.”
From a financial perspective, it’s important to examine how assets may be affected individually and as a cluster, notes Beardsley, who says: “Where do you have a lot of value in one place, where one hurricane, one drought, or one storm could come and have a massive impact?”
When it comes to operational information, the sensitivity of the various asset classes is also a consideration. “What does [the level of hazard exposure] mean for an airport versus a data center versus telecom companies,” Beardsley asks.
The next step is a maturity assessment of resilience mitigation actions taken by each company in a portfolio. “We ask them if they assess climate risk in their facilities and account for different scenarios for future climate change, and [for] potential impacts on their supply networks,” Beardsley says. “We ask if they have had major impacts in the last five years and whether they have invested money in resilience.”
The combination of climate risk and maturity assessments helps investors and property owners recognize when a company has high climate risk and low maturity, Beardsley says, then make appropriate investments in mitigation efforts. Hancock says, “The risk mitigation hierarchy that we deploy at a company is very much dependent on the maturity level. Operational controls, risk transfer through insurance, or redundancy planning matter more in some places than in others.”
Global Infrastructure Partners is using this framework and is applying it at the outset of the investment process as part of a 30-factor investment screening process that goes into the investment committee memo.
Assessing and addressing climate risk to drive value
Climate resilience discussions have become more important to stakeholders in the last few years, according to Morgan. “It’s like a big green arrow that indicates the relevance of resilience to companies today,” he says.
It’s not just about checking a disclosure box. Acting on these assessments is what drives value. “Essentially, you can estimate how much more a building might be worth because of a retrofit that increases its climate resilience,” Morgan says. “It’s similar to the choice a multifamily owner makes in a building without a pool. Adding one won’t lower operating costs, but [the building] will likely sell for more and offer a better experience to tenants.”
“Companies should educate board members about the importance of climate risk resilience, and then they need to integrate the risk management team with the capital expenditures team,” Hancock says. “It’s best to plan well in advance and overlay a climate risk plan with sensitivity in capital expenditures planning. The more we all build a framework for climate risk assessment and resilience—and recognize that we’re all interconnected—the better prepared everyone will be for future climate events.”
Save the date for the 2026 ULI Resilience Summit, occurring May 8 in Nashville, Tennessee, after ULI’s Spring Meeting.
