Sep 20, 2021 - Energy & Environment

First look: Real estate firms invest $140 million in climate tech

Illustration of hands holding money up towards Earth

Illustration: Annelise Capossela/Axios

Large real estate companies are putting $140 million into a climate tech fund that aims to help decarbonize the sector, according to an announcement Monday morning from the venture firm Fifth Wall.

Why it matters: The funding round, which includes some of the largest players in the industry, signals growing momentum toward backing new technologies needed to slash carbon emissions to net-zero by midcentury and achieve negative emissions thereafter.

Details: Fifth Wall, a venture firm focused on technology for the real estate industry, says the new investors in its climate tech fund include large players such as Equity Residential, Hudson Pacific Properties, Invitation Homes, Ivanhoe Cambridge and others.

  • The fund aims for a total raise of $500 million, and it plans to invest in mainly early-stage businesses, Brendan Wallace, co-founder and managing partner, told Axios.
  • "Real estate is kind of this massive industry when it comes to climate change, but at the same time we haven't seen the industry commit a significant amount of capital to the tech that's required to decarbonize it," Wallace said.
  • The Fifth Wall Climate Tech Fund has invested in several companies so far, including Sealed and Turntide Technologies.
  • Fifth Wall is a Certified B Corporation venture capital firm with about $2.5 billion in commitments and capital under management.

Context: The real estate sector is a significant player when it comes to climate change. According to the U.N. Environment Program, the buildings sector accounted for 38% of all global energy-related carbon dioxide emissions in 2019.

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