Major metropolitan office markets around the world are seeing a substantial increase in the adoption of "green" building certification programs, according to the inaugural International Green Building Adoption Index (IGBAI), a report by CBRE and Maastricht University (Netherlands). According to the report, 18.6% of room in ten markets across Australia, Canada, and Europe is now certified "green," compared to just 6.4 percent in 2007.
Canadian cities are leading the way, with 51.6 percent of space in Vancouver and 51.0 percent in Toronto certified as "green." This is particularly noteworthy in Vancouver, which has a structured campaign and action plan - "Greenest City 2020" - to become the world's greenest city by 2020. Green building trends will continue to drive both new construction and redevelopment of office product in Vancouver and Toronto. More than half of the 1.5 million square feet of product under construction in Vancouver is being constructed to strict green certification requirements, while most of Toronto's current class A product is undergoing extensive capital improvement programs that involve improvements aimed at achieving green certifications as well. properties in qatar
Increased demand for environmentally friendly buildings from governments, corporate tenants, and institutional investors has been especially noticeable in cities where "green" properties made up almost no part of the office market only a few years ago. For example, the "green" office square footage in Sydney and Melbourne, Australia's third and fourth cities in the index, increased from less than 1% in 2006 to more than 46 and 28.8%, respectively. Furthermore, the "green" office market in Warsaw was virtually non-existent until 2010, but now accounts for 21.3 percent of the space monitored by CBRE.
Even the markets with the smallest percentage of green office space as a percentage of total office property inventory experienced significant growth. Green building certifications in Paris, the study's largest market, increased from 0.1 percent in 2007 to 9.1 percent in 2017, while London, the study's second largest market, increased from 0.2 percent in 2010 to 8.7 percent in 2017.
Frankfurt, for example, registered 17.5 percent green product, up from 1.4 percent in 2009; Stockholm, 12.6 percent, up from 1.2 percent in 2011; and Amsterdam, 11 percent, up from 0.1 percent in 2011.
In many of these towns, green properties have outperformed the economy. As an example:
According to figures from Australia's Green Property Index, the cumulative three-year annualized return for "Green Star" six-star ranked office buildings was 15.6 percent in 2017, compared to 12.8 percent for the rest of the industry.
In the first nine months of 2017, certified green buildings accounted for a quarter of Frankfurt's 4.6 million square feet of lease operation, including two of the market's biggest lease transactions, totaling 151,000 and 75,000 square feet, respectively.
"Buildings, especially commercial properties, have long been at the forefront of pressing issues like water, waste, and significant energy usage, as well as the resulting carbon emissions," said David Pogue, Senior Vice President, Global Client Care/Sustainability at CBRE. "Green building certification programs are becoming much more prevalent and relevant to a variety of constituents and stakeholders as attention to these issues increases."
"Despite the fact that there are several local building certification programs, globally recognised green building certificates are more commonly used in the commercial real estate industry. Such standardized environmental performance metrics are needed by tenants and investors "Dr. Rogier Holtermans, the project lead for the International Green Building Adoption Index, said.