Blackstone Company Legence Acquires LORD Green Strategies

Legence, a Blackstone company that has claimed to be “maximizing the efficiency of more than 1 billion square feet across 5,000+ buildings,” announced the acquisition of LORD Green Strategies, a sustainability consultancy.

“This deal will strengthen Legence’s environmental, social and governance (ESG) consulting and advisory services to help clients fulfill their fiduciary and investment objectives while decarbonizing their operations and asset portfolios,” a company press release said. The acquisition results in Legence having “over $1.5 trillion in assets under management.”

The acquisition will occur through a merger between RE Tech Advisors, an existing Legence company that designs and implements decarbonization and sustainability consulting, and LORD. “Together, RE Tech Advisor’s and Lord Green’s clients include Invesco, UBS,  MetLife Investment Management, Principal Real Estate, the U.S. Department of Energy, among many others,” the release said.

LORD is a ESG and resiliency consultant and assessor providing strategy and data reporting. It works with such frameworks and reporting standards as LEED, Fitwel, BREEAM, IREM, Green Globes, and International Well Building Institute.

In addition to RE Tech Advisors, Legence owns Bel-Aire Mechanical (mechanical and plumbing services); Black Bear Energy (renewable energy solutions for commercial, industrial, and multifamily); CMTA (contracting and design-build for high performance and net-zero energy projects); CPMI (cost estimating and management); Gilbert (mechanical, electrical, plumbing, controls, and fire protection); ICS (facilities solutions); Provident Energy Consulting (supply- and demand-side); Therma (mechanical service provider); VarcoMac (electrical services); and Yearout (full-service mechanical solutions provider).

ESG has seen rapidly growing importance in CRE for a number of reasons. One is cost reduction. Energy use is an expensive part of operating properties. As rising oil and natural gas prices have been one of the biggest factors in inflation, the desire to reduce usage has become a financial necessity.

Then there are political, social, and investment pressures. Climate change has is a global issue, with regulations that directly or indirectly affecting CRE properties developing on national, state, and local levels. The topic sees polarized reactions in social settings, meaning, again, potential direct and indirect impact on properties and the people and companies associated with them.

And then there is the investment landscape. According to such CRE expert companies as Colliers, ESG has become a hot button item for many investors. “Environmental, Social and Governance (ESG) considerations, particularly environmental ones, are prominent on the investor agenda, with three quarters of investors integrating environmental factors into their strategies,” the firm wrote in December 2021.