Posted by:
Michael Greene
Director, Tenant Representation
Corporate Solutions

It was clear from today’s presentation the industry’s approach to sustainability has turned from one of potentially conflicting interests to a collaboration between investors, occupiers and managers of buildings.

It was very interesting to note that not only are financials presented to Fund Managers and their investors when considering acquisitions, but the green performance of buildings as well. The commitment to green is such that APPF have disposed of buildings they don’t believe they can get to their target of an average of 4.5 stars NABERS rating across their portfolio. They have another target of having 38% of their portfolio achieving five or six Green Star ratings by June 2011.

In the Q&A session the speakers compared the sophistication of Australia in terms of its green building ratings tools to some other markets in Asia Pacific that are lagging. But I don’t think it will take too long for investors in those markets to catch up – as US McGraw Hill study pointed to sustainability initiatives improving a building’s ROI by 6.6%, its valuation by 7.5% and its occupancy and rent ratio by 3.5% and 3.0% respectively. The value proposition is not only improved sustainability credentials and positive brand impact, but cost savings and an uplift in capital value.

For occupiers, again the value proposition of a green workplace is not only an alignment with the bank’s CSR strategy and a talent attraction and retention tool, but also improved building performance and efficiencies. ANZ’s commitment to being green now extends to their suppliers who must present their green credentials if they want to work for the Bank. Interestingly ANZ professed themselves as being a ‘fast follower’ in the sustainability space, wanting to find the sweet spot between the commercial realities and environmental outcomes.

I have seen the integration of the design, construction and operation of a building positively impact the sustainability outcomes. Of course this is easiest to achieve in new developments and secondary assets present added complexities. But we now have more measurement tools at our disposal to get an accurate read on an occupier’s carbon footprint, in both secondary and prime-grade real estate.

Michael

This entry was posted on Tuesday, August 3rd, 2010 at 11:10 am and is filed under CoreNet Global Summit, Sydney 2010, Sustainability. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.