Sustainable office buildings are in demand due to Regulatory Pressures, Climate Risks & evolving Expectations from Employees & Clients. Investors who act now can attract Premium Rents, Increase Occupancy Rates & Future-Proof their Assets.
Our colleague Osama AlHanbali offers the following summary of the Office Rental landscape and the various opportunities and threats that impact building owners & investors in terms of Sustainability Measures below:
🌱 Growing Demand for Green Spaces
Corporations are demanding sustainable office spaces due to regulatory pressures, climate risks, and evolving expectations. Certified buildings like LEED and BREEAM command premium rents, with green-certified spaces attracting rental premiums of over 7% in North America, around 10% in Asia Pacific, and more than 11% in London.
🌱 Energy Use Intensity (EUI)
EUI measures energy efficiency, helping reduce costs, lower carbon footprints, and improve sustainability efforts. Focusing on EUI enhances energy management, contributing to environmental and economic benefits.
🌱 Challenges and Opportunities
Meeting the demand for low-carbon workspaces is challenging, with only 34% of future demand projected to be met. This gap presents opportunities for developers and investors to prioritise sustainable design, attracting tenants and increasing yields.
🌱 The Financial and Environmental Imperative
Investing in sustainable buildings mitigates climate risks and operational costs. Poor environmental performance leads to rising costs and regulatory fines. Climate-related events have cost the US $612 billion in five years.
🌱 Regulatory Landscape and Corporate Responsibility
New building standards and corporate disclosure mandates are tightening globally. The Buildings Breakthrough at COP28 aims for low-emission, climate-resilient buildings by 2030, backed by 27 countries.
🌱 Strategic Planning for Long-Term Gains
Integrating climate resilience into decarbonisation plans reduces risks and supports continuity. Advanced climate modelling tools help businesses mitigate risks effectively.
The undersupply of sustainable office spaces calls for immediate action.
Early adopters will benefit from enhanced tenant attraction, higher rental income, and reduced costs. 2024 is a turning point for sustainable office buildings. Embracing sustainability meets regulatory requirements and enhances financial performance. The future of real estate is green and leaders in this space will reap the rewards.
Contact us today for further information about how LEED, BREEAM and the full suite of ESG guidance tools can future proof your assets.
Photo caption, Osama AlHanbali, Sustainability Engineer at Passive Dynamics Sustainability Consultants
