Opinion: While Australian real estate is making impressive inroads in green recruitment, office design and data lake adoption, further investment in building performance analytics is necessary to ensure we remain number one in commercial real estate sustainability.
GRESB (the Global Real Estate Sustainability Benchmark) is the international body that assesses the Environmental, Social and Governance performance of real estate and infrastructure portfolio.
In 2018 it surveyed over 900 real estate companies and the performance of nearly 80,000 assets worth $6.9 trillion around the world, and found that the Australia/New Zealand real estate market ranks number one for sustainability for the eighth consecutive year.
How did we do it?
Here are three critical sustainability areas Australia excels in and one we must invest in to retain our top spot.
- Sustainability recruitment
Transitioning a CRE portfolio to a more sustainable model begins with recruiting. Driving visionary green initiatives within an organisation requires a dedicated team or a proactive third party to plan and execute ambitious but realistic sustainability initiatives.
Successful enterprises are putting their money where their mouths are by hiring creatively to cultivate transformative digital strategies.
Australia has an impressive track record in sustainability staff recruitment. For the last several years companies such as ARA, Mirvac and Grosvenor have done a fantastic job of hiring sustainability professionals to drive efficiencies for their portfolios while increasing value for investors.
While Australia is currently ahead of the curve in terms of staff investment, I foresee this trend spreading globally in 2019. “Business as usual” is therefore no longer an option in the competitive landscape of better buildings and ultimately we will have to continue innovating to remain a leader in this space.
“Business as usual” is no longer an option in the competitive landscape of better buildings
- Sustainability design
With distinctly modern co-working spaces like WeWork now experiencing massive international success, the bar for co-working space design is raised and a range of large property owners around the world are adopting similar design philosophies.
The good news for Australia is that many co-working areas around the country were already designed for sustainability and occupant wellness before these factors became trendy.
In less than ten years, Hub Australia created its own distinct identity through a unique design philosophy and commitment to becoming a certified carbon neutral business by mid-2020.
The University of Sydney rolled out SAMBA climate quality monitoring to measure a range of factors with brand new sensor technology that captures air temperature, radiant heat, air movement, humidity, light, sound, carbon dioxide, carbon monoxide and more.
So far SAMBA sensors are deployed in over 50 offices nationwide and adoption continues to spread.
AMP Capital is also worthy of mention here; they partnered with PreciseAir in Melbourne for continuous air quality testing and reporting via a unique mobile app.
- Data lakes
Australian companies like Dexus recognised the value of data lakes in real estate as early as 2015. In Dexus’ case, their market-leading “virtual engineering” smart data program continuously captures portfolio performance elements such as air quality and temperature so that analytics-based alterations can be made to drive cost efficiency and occupant comfort.
Mirvac is also blazing the CRE data trail with new smart building projects like 200 George Street in Sydney,providing occupants with real-time performance data through a unique app.
Lendlease uses indoor environment sensors throughout their properties to regularly report findings, ambitiously leveraging them to create a projected 20 per cent reduction in energy, emission and water intensities by 2020.
What does Australian real estate need to do to stay number 1 in sustainability?
In recent years, Australia has distinguished itself in sustainability reporting, workplace design and wellness standards.
However, we must build on this distinction by investing in deep analytics for building performance to analyse and address root cause issues. These are known ways to increase an organisation’s net operating income while significantly lowering carbon emissions.
Most importantly, effective building performance analytics create new value and scale quickly. Once you integrate sensors and networks in one building to increase site value, this process can be quickly rolled out across an entire portfolio for multiplied success.
Companies like NHP, Grosvenor and ARA are using this approach to strengthen their powerful upward trajectory in the industry. They’re fast-tracking asset value growth by lowering operational costs, increasing property value and delivering exceptional occupant comfort.
Beyond financial and sustainability outcomes, the proptech community in Australia must embrace comprehensive, portfolio-wide performance benchmarking and analytics to inform strategic business planning and decision-making.
From space utilisation and workplace design to selecting efficient service partners and supporting employee satisfaction, the entire human experience for years to come will be affected by how we utilise technology to improve business today.
“Further investment in deep analytics for portfolio performance is vital.”
For these reasons, I firmly believe that further investment in deep analytics for portfolio performance is a significant influencer to Australian CRE remaining number 1 in sustainability for years to come.
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