Texas Leads US In Metro Areas With Most Environmental Risk

Three cities in Texas lead YardiMatrix’s list of US metro areas with the most environmental risk, according to a new report from YardiMatrix.

Houston, Austin, and Dallas all received low scores in the firm’s recent ESG report, in the “natural disasters” and “government response” categories. The cities suffered mightily under the weight of the February 2021 winter storms, which claimed 150 lives statewide, and well-documented power, food and water shortages last year affected more than 4.5 million residents. Property damages exceeded $20 billion. 

“The Texas storms are a demonstration of the stakes,” the report notes. “Texas has reaped the benefits of deregulation and low taxes/utility costs, but utility providers’ lack of investment to winterize the power grid left the state unprepared to handle extreme weather. Without collective action to mitigate environmental risk, such disasters with high damages will recur.” 

The cities were followed by Tampa and Los Angeles. On the flip side, four metros had the least environmental risk: Boston, Indianapolis, Minneapolis and Portland. 

“The commonality for all was being in states that are taking environmental risk seriously,” the report notes. “Boston and Indianapolis received the highest grades in three categories and the lowest grade in one, while Minneapolis and Portland received high marks for government action and propensity for natural disasters and middle grades for pollution and water quality.”

YardiMatrix researchers note that data in the field is “difficult to obtain and measure.

“Concerns about the ability of financial firms to assess environmental risk has spawned a new cottage industry of consultants that are attempting to gather and analyze environmental data and translate the impact on markets and individual buildings,” the report notes. “The field is in its infancy, with better data and metrics yet to come.”