THE PROPERTY DEVELOPMENT REVIEW
from a landlord perspective from recycling, down to fresh air and water. Green Star, NABERS, Well certifications are all part of that, the primary use is to ensure that the ongoing use and operation of the building to minimise environmental impacts. What ESG measures are most in focus in the leasing market and what are corporate tenants looking for? Once upon a time you had to buy a luxury car to get airbags however now it’s expected that everyone has them - good ESG practice are much the same. It is now expected that ESG measures, ratings and requirements are standard. Corporates will have requirements in relation to building operations, centred around NABERS energy and water and the operation of the building however green star relates primarily to new builds and materials. If tenants are looking at committing to a new building, they will have more requirements of a landlord in relation to what the building has to achieve in relation to NABERS, Green star, Well and ESG, particularly around carbon. Every building/tenancy required to have a NABERS (Energy) certification if its over 1000sqm, however it is often a challenge for some existing B and C-grade buildings to achieve a high rating, given their older and in some cases the owner’s unwillingness to spend money on upgrades to achieve that higher rating. Institutional landlords are at the forefront to achieve the highest possible ratings as they are seeking to attract not only Government tenants, but also major corporates that have their own green expectations on the buildings they occupy. Major REITs and their investors are also really pushing the green mandate on their investments moving forward, particularly around carbon. They have to maximise their environmental ratings throughout their portfolio and in some cases carbon neutrality through carbon offsets or purchasing green power through sustainable providers. Colliers integrates sustainability into their property management services; what expert advice around sustainability and green building standards do you provide and how do you ensure premises comply? We have an entire ESG/ESD team who advises developers and major clients on existing buildings in relation to the best ESG measures. They will come in and assess the operation of the building and show a roadmap of how they can transition to an improved level. It’s a lot easier with a brand new development to set a benchmark and design around it as opposed to an old building, where unless you have tri-generation or co-generation, its very challenging to achieve that 6-star rating. Although a push for all electric buildings will see gas phased out over time. You have long term involvement with Cbus Property and are currently working on 435 Bourke street, Melbourne. Why is this development so significant? We already had a scheme in place that was developed prior to COVID, then the city effectively was in lockdown. ESG started to
evolve more at this time and was largely centred around a flight to experience. We interviewed many tenants about what else we could do to attract and retain them and give them a good reason to want to come back to work. 435 Bourke Street addresses a lot of those ESG and tenant requirements in a way that no other CBD building has and will provide a better overall customer experience and provide a genuine flight to quality. Cbus Property will mandate the appointed builder track their carbon footprint and try mitigate it from start to finish, from procuring steel to green concrete and other sustainable materials like masonry and avoiding materials that have a high carbon footprint.. They also want access to fresh air, health and well-being, gender equality and diversity in the process. 435 Bourke have 3 dedicated levels to a central sky garden, to let light and fresh air in and although it will still be a conditioned space, you have the option on a nice day for it not to be. There will also be electrical vehicle and scooter charging points, e-bikes, a wellness facility, and a dedicated mezzanine to pilates and consulting rooms. A big game changer however will be the solar facade. Solar panels on a rooftop in an existing building might generate 2-3 % of the buildings base power, however the solar on 435 Bourke street will generate 20% plus. This building is due to be delivered in 2026 however because technology advances so quickly, we’re not going to procure the solar panels until the last minute. So based on the current technology it is about 20% however the view is that the solar panels will be more efficient by the time it’s completed and exceed that 20%. The balance of the building will be powered supplied through a renewable energy supplier, so that’s a big game changer when you’re not relying on the traditional grid to power a building of 60,000 sqm and it will set a very high benchmark moving forward.
435 Bourke Street, Melbourne.
[1] Quote by Rohini Nilekani, writer, author, philanthropist and founder of Arghyam Foundation, a non-profit that focuses on water and sanitation issues. [2] https://www.unepfi.org/fileadmin/events/2004/stocks/who_cares_wins_ global_compact_2004.pdf
September / October 2022 – 9
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