Starting this summer, California-based billionaire Tom Steyer's Galvanize Climate Solutions is gearing up to make "sizable" investments in properties with the goal of creating a net-zero portfolio in three years.

Instead of achieving these goals through the use of offsets, the plan will employ proprietary retrofit methods and solar panels to improve efficiency in carefully selected assets, Bloomberg reported.

"This is a real estate strategy with a decarbonization goal,” Joseph Sumberg, the head of Galvanize Real Estate, told Bloomberg. “Capitalism will look at this successful strategy, and replicate it, creating ripples through the built environment.”

Galvanize Real Estate anticipates making purchases of existing multifamily, industrial, student housing and self-storage properties in the Western U.S., especially in the Pacific Northwest, Colorado, California, Arizona and Texas.

Galvanize is looking for deals where it can achieve both "a certain risk-adjusted return" and decarbonize, and it won't do a deal unless it ticks both boxes, Sumberg told Bloomberg.

Other businesses are zeroing in on the potential financial and social benefits of reducing carbon emissions in real estate, and investors are paying attention. In March, electrification startup BlocPower raised $155M to expand its work via a funding round led by Goldman Sachs.

In the U.S., 30% of the energy used in commercial buildings is wasted, "leaving a huge opportunity to create efficiencies and cost savings," Galvanize said in a release.

But despite an increased focus in the industry on reducing greenhouse gas emissions, a Bisnow investigation published this week found that of the 75 largest institutional investors, about half have no plan for reducing their emissions.