Increasing demand for more sustainable buildings

• Tenants are growing more and more concerned about the environmental and social impacts of their business operations. The drivers for this include corporate social responsibility, employee productivity, attracting the best employees, limiting risk exposure to the continued growth of environmental legislation and basic cost reduction.  Sustainable buildings help support them in delivering on sustainability commitments and policies.Tenants are also increasingly focused on their total property occupancy costs. This goes beyond rent and rates and includes service charges, utility costs and productivity impacts.  They need clear guidance on how two otherwise similar buildings might differ from one another in these regards.




• Owners, with a growing demand from tenants and shareholders reduce environmental impacts, are increasingly recognising that building which have higher sustainability credentials obtain better rents and better sale values as a result.  On the downside, failure to meet what are increasingly market norms may have an adverse effect on the time a property takes to let, the lease lengths achieved and the propensity of tenants to renew.




• Investors and fund managers are becoming increasingly interested in the sustainability performance of property funds in which they invest. The growth in environmental legislation presents a clear risk and requires owners to both understand and take responsibility for the environmental performance of their buildings.




• Many organisations now have aspirations or requirements relating to the environmental performance of the buildings    they own and/or occupy e.g. minimum NABERS or Green Star ratings, or corporate targets for reducing adverse environmental impacts.    Understanding how these objectives impact on an organisation’s property decisions will help a leasing agent provide a better, more differentiated, service to its clients.