Partnering with IFC to advance sustainable building design

In combination with the International Finance Corporation (IFC), Carlyle invests in warehouses in China that are designed with sustainability in mind from the start.

In 2018, Carlyle invited IFC, the private investment arm of the World Bank Group, to participate in a dedicated co-investment to develop green and sustainable warehouse buildings with a modern logistics platform in China, known as Project Rome.

The warehouses are being designed and built using EDGE, a tool developed by IFC that enables development partners to identify potential green elements in their building designs quickly and early in the process. IFC’s range of EDGE solutions helps companies model how construction factors such as building orientation, materials and energy-efficient lighting can help reduce costs and climate change impact. EDGE factors in local market conditions to provide cost-benefit data on specific green building features.

Available for free online, the EDGE tool allows developers to design their projects to minimize water, material and energy use. To become EDGE-certified, developers must achieve at least a 20% improvement compared to the baseline structure in all three categories in a given geography. IFC provides ongoing training to partner developers on how to use the EDGE tool and acquire EDGE certification, making it both cheaper and easier to use than more cumbersome alternatives. Project Rome’s commitment to EDGE certification prompted IFC to double its investment.

Carlyle and IFC are developing, building and operating nine warehouses in various cities across China. All of the warehouses are located in large population centers with easy access to major transportation networks and in industrial parks with no large residential communities nearby. This project represents the first time EDGE has been applied to warehouses in China. When complete, the warehouses will total 10 million square feet.

The properties’ high environmental standards are expected to make them attractive to world-class tenants, an appeal that can enhance the investments’ performance. Targeted tenants include third-party logistics providers, e-commerce companies, retailers or manufacturers with light assembly activities onsite. One of the project’s first tenants is Carrefour SA, a multinational retailer based in France.