CNSREIT-AR-2024 Final - Flipbook - Page 50
Further, significant physical effects of climate change, including extreme weather events such as hurricanes, floods,
droughts and wildfires, can also have an adverse impact on our properties, operations and business. For example, our
properties could be severely damaged or destroyed from either singular extreme weather events or through long-term
impacts of climatic conditions (such as precipitation frequency, weather instability and rising sea levels). Such events could
also adversely impact us or the tenants of our properties if we or they are unable to operate our or their businesses due to
damage resulting from such events. If we fail to adequately prepare for such events, our revenues, results of operations and
financial condition may be impacted. Furthermore, climate change could increase utility and other costs of operating our
properties, including increased costs for energy, water and other supply chain materials, which, if not offset by rising rental
income or paid by tenants, could have a material adverse effect on our properties, operations and business. In addition, we
may incur significant costs in preparing for possible future climate change or climate related events or in response to our
tenants9 requests for such investments and we may not realize desirable returns on those investments. As the effects of
climate change increase, we expect the frequency and impact of weather and climate related events and conditions to
increase as well. For example, unseasonal or violent weather events can have a material impact to businesses or properties
that focus on hospitality.
Our business is subject to evolving corporate governance and public disclosure regulations and expectations that could
expose us to numerous risks.
New regulations or interpretations of existing laws have resulted in, and may continue to result in, enhanced disclosure
obligations, including with respect to cybersecurity, insider trading and climate change, sustainability risks or other
environmental, social and governance matters, which could negatively affect us or materially increase our regulatory
burden. Additionally, any such laws or regulations could also impose substantial costs on our tenants, thereby impacting
the financial condition of our tenants and their ability to meet their lease obligations and to lease or re-lease our properties.
At the same time, regulators and legislators have increasingly expressed or pursued opposing views, legislation and
investment expectations with respect to sustainability initiatives, including the enactment or proposal of
