Picton Property Income Limited Sustainability Report 2022

Environmental Focus

Introduction

Stakeholder Engagement

Governance

Appendix

Sustainable buildings continued

Building certifications The Green Building certifications across the portfolio have remained the same as in the previous reporting year, however the scale of coverage has increased due to the sale of one asset. Certifications are BREEAM and ISO at three office locations, Angel Gate, London, Tower Wharf, Bristol and Metro, Manchester. The two BREEAM awards are both rated as ‘Excellent’. As part of our ongoing strategy we are exploring the suitability of obtaining ‘in use’ certifications at some of our assets, in addition to following the guidance set out in our sustainable refurbishment guidelines. Site type Green Building certification 2021

Green lease clauses Green leasing continues to be a collaborative tool between ourselves and our occupiers to improve the performance of a building. The majority of an average commercial building’s greenhouse gas emissions come from occupier controlled areas and therefore the best way to improve the efficiency and productivity of the whole building is through collaboration. The ideal green lease will help enhance the environmental performance of a building and mitigate any environmental legislative and market risk in addition to fostering improvements in data collection. Our bespoke set of green lease clauses continue to be successfully incorporated in new leases and lease renewals. We have found that the adoption of these clauses by occupiers is continually increasing as the benefits to both parties’ own sustainability strategies become clearer. Our target is to ensure all of our lease agreements include green lease clauses. We continue to monitor best practice and will amend the clauses accordingly where appropriate. Over the year we have completed a further 42 green leases, of which 81% were gold rated (based on the strength of the clauses adopted). In total there are now over 30% green leases across the portfolio. This number will continue to rise as we use lease events and letting of vacant units to drive take up.

Office

29%

Minimum Energy Efficiency Standards (MEES) This year we have amended the basis for reporting our EPCs to better reflect risks and recognise the diversified nature of the portfolio. Looking at the percentage of EPC ratings by estimated rental value (ERV) of our portfolio, 71% have an EPC rating of A-C, 29% are D or E and only 0.2% is rated F or G. We continue to proactively manage our compliance with Minimum Energy Efficiency Standards (MEES) which stipulate that a new lease cannot be granted if the building is rated lower than an E rating. This ruling will apply to existing leases from 2023. We have a strategy in place for the small proportion of our portfolio that is affected. Over the year we reassessed 18 EPCs. Using the same reporting basis (by ERV as stated above). 96% have been reassessed to A-C rating, 4% D-E rating, and none

were F or G rated. We continue to use lease events, common area works and EPC renewals to implement improvement works with the overall aim of continually improving our EPC score and ensuring compliance with MEES. We note the UK Government will implement a tightening of the MEES rules to a minimum C rating by 2027 and B rating by 2030 and are implementing a strategy to ensure that all our assets are in line with the new regulations. Notwithstanding the legislative position we see alignment with MEES regulations as integral to our net zero pathway, occupier engagement strategy and environmental focus. We will continue to proactively manage the portfolio on this basis.

Retail, High Street Retail, Warehouse

0% 0% 0% 0% 0% 6%

Industrial, Business Parks Industrial, Distribution Warehouse

Hotel

42 New green lease clauses