'Explosion of interest in sustainability': The lure of star performers
The importance of 6 Star Green Star ratings with new builds is impossible to overstate, say commercial real estate experts. They’ve gone from being a desirable target to an absolute necessity.
“For occupiers, green certified buildings indicate a place that promotes effective, productive and collaborative spaces for their employees,” says Rebecca Jinks, head of sustainability and ESG, Asia Pacific for Cushman & Wakefield.
“They benchmark substantially lower operating costs and, due to the positive market position, have lower vacancy rates.
“As a result of improved operations, performance, resilience and attractiveness achieved through green building certifications, the property value sees an increase, as does the rental return.”
In short, they’re a win-win for everyone, as well as for the environment, advises Green Building Council of Australia CEO Davina Rooney. The rating, and its acceptance throughout the country, has turned us into global leaders in the art of office building.
“It’s a very exciting time and the standard is getting set higher and higher,” she says.
“There’s now been an explosion of interest in sustainability, and we’re producing some buildings that have become exemplars for the world.”
In Sydney, for example, there’s the offices of Barangaroo, the nation’s first carbon-neutral precinct, as well as tech giant Atlassian’s plan with Dexus, SHoP and BVN for a $546 million 40-storey timber skyscraper next to Central Station that will operate on 100 per cent renewable energy, with solar panels set into the facade and natural ventilation.
In Brisbane, meanwhile, there’s 25 King, the tallest and largest engineered-timber office building in Australia, co-created by Lendlease, Aurecon and Bates Smart. Close by will be 80 Ann – or Heritage Lanes – by Mirvac with Suncorp as its anchor tenant, designed by Woods Bagot, targeting WELL Gold Shell and Core as well as the 6 Star Green Star rating.
“But the focus isn’t just from new builds,” says Rooney. “It’s also on existing buildings and those being refurbished.”
It’s also on smaller office buildings in suburban hotspots, too. In Melbourne, developer Dare Property Group’s mid-rise boutique office building, the five-storey SJB-designed Zero Gipps in Collingwood, is named after both its Gipps Street location and its zero operational emissions.
Among its features are a renewable energy supply via a 20-kilowatt solar PV farm on the roof, a recycled rainwater supply, green landscaping helping provide insulation, a garden of edible herbs and botanicals, and electric bike charging stations.
“Companies are finding the building’s attributes will be of great appeal for their staff, including the end-of-trip facilities, cafe, rooftop and green credentials,” says Lemon Baxter leasing agent Samuel Torrance of the building to be completed later in 2022. “This all speaks to who they are as a company.”
JLL reports that Australia’s cities are at differing stages of their environmental journey. Sydney has the greatest volume – 2.3 million square metres – of NABERS-rated office stock at or above 5.5 stars, with Melbourne having 1 million square metres and Brisbane 690,000 square metres.
Connor McCauley, JLL’s energy and sustainability operations director, Asia Pacific, says, “It is incredible to see how the property industry has adopted sustainability principles into the market, driven largely by the NABERS and Green Star rating systems.
“This trend is not slowing down but accelerating rapidly and the expectations that a property will have a very high rating (5 or 6 stars) is increasing in parallel to this. Buildings in today’s market are now expected to consume 50-70 per cent less energy than they did a few years ago.”
JLL’s CEO Australia, Dan Kernaghan, says it’s critically important for companies to have highly rated buildings in their portfolio, as well as improving the performance of older assets, to reach net zero targets.
“As target dates get closer, the focus on 5 Star and 6 Star rated buildings will increase and accelerate,” he says. “And this focus is also key with owners of office buildings and investors.
“The incentive for higher rated buildings is not just market perception or market-value related but is also to minimise the costs to achieve net zero carbon accreditation.”
While the 6 Star Green Star rating is now an expectation of new buildings, the spotlight will next fall on secondary assets, predicts Mark Curtain, head of office leasing at CBRE’s Pacific office leasing, to either retire, or refit, them.
