GOVERNANCE AND TRANSPARENT REPORTING
INTRODUCTION
SUSTAINABILITY OBJECTIVES AND STRATEGY
ENVIRONMENTAL
CORPORATE CITIZENSHIP
APPENDICES
RESILIENCE Climate change presents physical and transitional risks to the real estate sector with direct potential impact on operations and long-term value. Our ability to identify, evaluate, adapt, and respond to potential impacts is critical to our resilience as a company. ESRT proactively models potential tangible and economic aspects of physical and transitional climate risk in the short-, medium-, and long-term, and develops targeted strategies to mitigate these risks. The company implements policies, advances technologies, executes energy efficient infrastructure and modernization plans, manages financial resources, and adopts adaptive measures. PHYSICAL RISKS In 2019, we developed and implemented a Climate Change Adaptation and Resilience Policy and Operational Plan for our portfolio. As part of this policy, we complete a Climate Change Risk Assessment Checklist during the due diligence process for all potential acquisitions. In 2024, we completed a risk assessment with a third-party provider to calculate potential risks for each property utilizing the Intergovernmental Panel on Climate Change (IPCC) Representative Concentration Pathways (RCP) 2.6, 4.5, 6.0, and 8.5. Results from these assessments, shown below, help ESRT identify, prioritize, and plan to mitigate physical climate-related risks. Physical risks for the New York City Metropolitan Area include rising sea levels, storm surges, and extreme temperature fluctuations that could adversely impact the regions where we operate. For more than a decade, we have maintained adaptation and mitigation procedures, such as a formal disaster recovery plan and business continuity plan. Our Climate Change Adaptation and Resilience Operational Plan includes guidelines for floods, storm surges, windstorms, wildfires, air quality, hurricanes, extreme weather, and winter storms. ESRT works with our insurers to proactively design plans that consider climate-related risk. To diversify the risk basis, our plans integrate disaster recovery and business continuity coverage through multiple insurers.
Low Impact: Unlikely to have a substantive financial or strategic impact on operations. Medium Impact: Likely to materialize but may or may not have a substantive financial or strategic impact on operations. High Impact: High probability of materializing and having a substantive financial or strategic impact on operations.
Short Term Present - 2030
Medium Term 2030 - 2040
Long Term 2040 - Beyond
Risk
Sea Level Rise
Low
Low
Low
Fire
Low
Low
Low
Wind
Medium
Medium
High
Extreme Heat
Medium
High
High
Air Quality
Low
Medium
Medium
Power Interruption
High
High
High
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2024 SUSTAINABILITY REPORT
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