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  1. December 2019

  2. Fuelling debate: will occupiers pay more for eco-friendly workspace?

    18 December 2019
    From the chairman of RIBA’s sustainability group to the mayor of New York City, there is a growing number of industry experts and public figures questioning the wisdom of building ever-more air-conditioned glass skyscrapers if the property sector and cities want take climate change seriously.

    Even as far back as the late 1940s, the Swiss architect Le Corbusier was a vocal critic of the world’s first full air-conditioned glass tower, the UN Secretariat in New York, attacking it as unsuitable for the local climate. But the gleaming aesthetics took hold a city’s global credentials are often judged by the height and mass of its glittering skyline.

    But the problems of regulating the temperature of glass buildings go back further than that, with a visit to London’s Crystal Palace a very different picture than the beautiful sketches we see depicting the Great Exhibition. The reality was of huge canvass curtains hanging around the interior to keep the giant greenhouse from overheating – something that proved horribly difficult to control – and blocking out much of the building’s glass aesthetic and natural light.

    According to The International Energy Agency, the built environment produces around 40% of global carbon dioxide emissions, with the energy used on cooling alone now accounting for a chilling 14% of all energy use. As temperatures rise, so air conditioning needs to work harder, using not only more energy but increasing the wear and demand on systems with the likely result of shortening their lifespan.

    As we have seen with the New Routemaster buses in London, the simple act of opening a window and letting in a breeze can be more pleasant, more reliable and more popular than air-conditioning, not to mention more eco-efficient. But the realities of big city noise and air pollution are an obstacle in applying this to many new office buildings, despite an estimated energy saving of around 60-70%.

    We are conscious to plastic bags, excess packaging and littering the oceans, with changes in awareness bringing about major changes in habits. But what about the spaces we work in? The technology exists to build more energy-efficient buildings – and many landlords and developers we speak to in the early stages of their projects express an enthusiasm and desire in attaining a BREEAM rating – but the big question hanging over the conversation has been whether occupiers would care enough to put their money where their sustainably statements are. The latest research from CoStar answers that question with a resounding yes.

    Over the last decade, BREEAM-rated buildings have attracted a significant premium, with an average increase in value of £374 psf since 2009, almost double the national market average of £196 psf.

    The UK has around 1,700 office buildings with a BREEAM rating, with London hosting about half of them with just over 800 accreditations, making up about 3.5% of the Capital’s total office inventory. That percentage is the highest in the country and includes one of the world’s most sustainable offices, Bloomberg Place, where technology and innovation include smart ventilation, water conservation and half a million bulbs of efficient LED lighting.

    In second place for numbers is the South-East with just over 150 buildings, although that accounts for just 1% of the total office inventory. In percentage terms it’s Wales that takes second place with 2.1%, followed by the North East and Northern Ireland, both around 1.5%.

    It should be noted that these buildings are usually not 100-storey crystalline towers and tend to use materials other than glass and steel. But if we are to continue building upwards to cope with increased capacity, perhaps the answer lies in birthplace of the skyscraper, New York City. The origins of the world’s most recognisable skyline were in tall buildings of brick and stone that are no less striking than contemporary glass structures: no-one could accuse the Empire State or Chrysler Buildings of being inconspicuous or, in today’s terms, non-iconic. Could reinterpretations using the materials of then with the design of today and the technology of tomorrow be the solution to tall cities and high efficiency?

    So if the demand is there and backed by hard evidence that occupiers will pay significantly more for an environmentally-friendly workspace, why are we not building more efficiently more often? Perhaps the missing link is simple awareness in the property sector. If more landlords and developers were aware of the financial opportunity of efficient buildings, surely an increase in delivery would follow? When looking at the increased amenity given to buildings to attract higher rents (gyms, wellness suites, cafes, lounges, terraces, etc), landlords have shown that they are all in.

    As agents, we are uniquely positioned to convey the message. With such willingness among occupiers to pay a premium, yet with each UK’s region’s extremely low supply of BREEAM rated workspace, there is huge potential to not only build, but also to upgrade existing office space, in way that makes sound financial sense, delivers greater ecological rewards and lays the foundations of a sustainable future for expanding cities.

    In short, a win-win solution.