The Importance of Sustainability in Commercial Real Estate Development in Australia
Australia's dominance in sustainable real estate is commendable and instructive, as evidenced by its leading position in the 2022 GRESB Real Estate Benchmark. With a score of 81, Oceania notably outperformed the global average, underscoring Australia's commitment to excellence in sustainability. Beyond just achieving impressive international rankings, Australia has innovatively contributed to the global sustainability dialogue through the development and exportation of its rating system, NABERS.
Initially a New South Wales initiative, NABERS' success in Australia and New Zealand paved its way to the UK, marking Australia as a key player in global sustainability efforts. A competitive drive partly fuels this international stature in sustainable real estate, yet it also reflects deeper commitments to environmental stewardship and to meeting the ambitious net-zero targets set for 2030.
Because of this, Revolve Commercial and other leading commercial real estate developers in Australia make sustainability a top priority in their planning and development processes. They understand that sustainability is not just about reducing carbon footprint or achieving green certifications but also about creating long-term value for both the environment and their stakeholders.
Elevating the Significance of Sustainable Real Estate Practices
The significance of sustainable real estate standards transcends mere compliance; it's imperative for the health of our planet and the well-being of our communities. Amid mounting environmental challenges, these standards serve as a blueprint, enabling developers, architects, and building owners to craft buildings that harmonise with the environment. This approach not only lessens ecological impact but also enhances occupant health and well-being, making sustainable development a keystone in shaping a resilient and thriving built environment.
Strengthening Environmental Standards through Innovative Rating Systems
Australia's Green Building Council, established in 2002, has been a pivotal force in the sustainable evolution of the construction sector. Its introduction of the Green Star rating system a year later, alongside existing frameworks like NABERS, has dramatically propelled the nation towards carbon efficiency and sustainability in its built environment.
NABERS, with its origins in the late 1990s, has since flourished into an esteemed international benchmark for evaluating sustainability performance in various building sectors. It offers a precise tool for property owners to gauge and showcase the environmental footprint of their buildings, spanning energy and water efficiency, waste management, and the quality of the indoor environment, through a clear one-to-six-star rating system.
The widespread adoption of Green Star and NABERS has cultivated a marketplace that is both knowledgeable and ambitious, enabling clear communication of a building's environmental performance. This, in turn, empowers tenants to make informed leasing decisions that align with their sustainability objectives.
Additionally, these systems allow for consistent comparing and benchmarking, fostering a competitive yet collaborative environment aimed at reducing carbon footprints across the board.
Tackling Climate Change Through Enterprise Initiative
While there has been critique over the pace of legislative action on climate change within Australia, the country's commercial real estate sector is stepping up, taking proactive steps towards reducing their carbon footprint.
A notable example is the GPT Group, which ambitiously aimed for net-zero carbon emissions across its property portfolio in prominent Australian cities by the end of 2020—a goal it astonishingly achieved ahead of schedule, preventing the emission of an additional 1.5 million tonnes of CO2 than initially expected.
This trend of surpassing environmental targets is not isolated to GPT Group. Charter Hall, owning Australia’s most extensive collection of Green Star-rated buildings, exceeded its FY25 NABERS energy performance targets with a stellar 5-star weighted average across its vast office space portfolio. This accomplishment has inspired a more aggressive target, pulling its net-zero carbon emission goal forward to 2025.
Similarly, QIC has pledged to reach net-zero emissions for its Australian retail properties by 2028, pioneering in the commitment to the World Green Building Council’s pledge for net-zero carbon in retail buildings. These significant strides by leading real estate investment trusts (REITs), all partners of CIM, underscore the powerful role private enterprises play in driving Australia's sustainable future.
Collaborative Industry Culture Enhances Sustainability Efforts
In Australia, while competition drives the market, there's an intrinsic sense of collaboration, especially in facing environmental challenges that affect the nation's collective well-being. The adverse effects of climate change, such as rising temperatures, severe droughts, and increased fire hazards, along with substantial floods and oceanic changes, underscore the urgency of a united effort. Australia's property sector witnesses a unique co-operative spirit, driven by the shared goal of resilience and sustainability.
Lisa Hinde, the Head of Sustainability at Colliers, during a CIM webinar titled "The Role of Operations in Achieving Net Zero," highlighted Australia's exceptional performance in the GRESB assessments. She attributed this success to the industry's transparent and collaborative nature, where sustainability experts across companies freely share insights and strategies to improve their collective environmental impact.
David Walsh, Founder and CEO of CIM, also pointed out the remarkable level of cooperation he observed among leading real estate investment trusts (REITs), facilities management companies, and other stakeholders while serving on the Green Star Advisory Committee. Such collaboration, even among competitors, illustrates a national commitment to sustainability, evidencing a collective action spirit when faced with global challenges.
Harnessing Data for Sustainable Building Management
Australians excel in adopting a data-driven strategy to enhance building operations, embodying the principle that effective management is rooted in accurate measurement. Esteemed figures in the sustainable property sector, including Davina Rooney and David Walsh, leverage their expertise in engineering and computer science to streamline this process.
This focus on quantifying performance and monitoring operational activities provides critical insights that guide strategic investment and capital allocation, aiming to minimise waste. The implementation of CIM’s PEAK Platform vividly illustrates the power of optimising the performance of current plant and equipment. For instance, Charter Hall and GPT Group have witnessed substantial efficiency improvements without premature equipment replacement.
A notable case saw a client achieving a 33% reduction in energy consumption after PEAK identified unnecessary overnight equipment operations, a problem rectified without incurring any capital costs. This relentless pursuit of data-informed decision-making has enabled CIM, along with other industry forerunners, to enhance operational efficiency, sustainability, and occupant comfort, all while aligning with the financial objectives of property owners and investors.
Through meticulous adjustments and ongoing enhancements, significant advancements in asset performance are realised, demonstrating the tangible benefits of a data-centric approach to sustainable building management.
