Tool Box
Issue No. 47 - June/ july
Sustainable becoming a tie-breaker
by Mr Shayne Bakewell
When times are tough, why would property investors and occupiers consider ‘going green’? The instinctive answer is, “they probably wouldn’t” but there are some very compelling reasons why sustainable property is a good investment for both owners and tenants.
For owners and tenants sustainable development is about having efficient premises that minimise energy use and provide high quality working environments.
Owners gain ‘future proofed’ assets which will be valuable in times to come, while tenants can encourage staff to commit to the firm and in the fullness of time - well before most new leases expire - ensure their products and services do not accrue penalties under the postponed but Carbon Pollution Reduction Scheme.
It is important to remember a ‘green’ building does not need to be high tech, but of good design and construction. As design knowledge increases, efficient solutions are delivering operational savings based on sound economic principles rather than altruistic good will.
Owning property, whether for personal use or as an investment, has always been about capital gain. But to have the best chance at capital gain, the property must be viable in the future and it is becoming abundantly clear buildings which are not ‘green’ or cannot be upgraded are being discounted.
It is likely community expectations of sustainability standards will continue to grow. What we now consider‘extreme’ will probably become the norm in years to come. In that case properties with “old technology” might be discounted or even become unsaleable. For instance, in the near future it will become mandatory to quote commercial office energy efficiency in sales documents.
From a tenant’s point of view, the ‘flight to quality’ becomes more pronounced in difficult economic times because tenants can get better premises for the same rent. For many tenants, “better premises” means “more efficient” - lower ener...
