• Australia and Singapore emerge as regional green building leaders

    6 May 2012

    Although green buildings are a relatively new phenomenon in much of Asia Pacific, two countries – Australia and Singapore – are already firmly established as green building centres of excellence on both the regional and international landscape, says CBRE’s Jonathan Hills.

    In both markets the adoption of a robust regulatory and incentive framework, which in turn has stimulated local developers’ wholehearted adoption of sustainability practices, has proven highly successful and stands as an example to other markets in the region which, in many cases, continue to lag behind. 

    In Australia beginning in mid-1990s a number of state governments put in place initiatives that created a framework for the improvement of the sustainability of the built environment. In 1997 the government of New South Wales announced substantial GHG emissions reductions and sponsored the development of the Australian Building Environmental Rating system (ABGR). ABGR ratings were expanded to cover the whole of Australia in 2001 and then transformed in 2005 into the NABERS program – the National Australian Built Environment Rating Scheme. The NABERS scheme has been widely accepted across Australia and forms the backbone of several government energy efficiency initiatives. 

    The Green Building Council of Australia was established in 2002 and has been a major force in raising awareness of environmentally sound building practices and promoting a sustainable property industry in Australia. Its Green Star rating system has significant market penetration in the commercial office sector, and is almost universally adopted for major new developments as a benchmark of good practice. The ABGR/NABERS and Green Star rating systems were developed as voluntary initiatives, allowing owners and developers to demonstrate their good behaviour against recognised benchmarks. 

    In late 2007 Australia ratified the Kyoto Protocol and established a commitment to emissions reductions at a national level. Part of this commitment was the development of the National Strategy on Energy Efficiency, one element of which was the Green Building Fund, which provided grants to owners of up to AU$500,000 or 50% of the value for retrofitting projects focused on improving the energy efficiency of existing office buildings. The Fund created a surge in retrofitting projects and enabled many owners to undertake multiple improvements in one project to achieve efficiencies and benefits for occupiers. Innovation and the use of Australian technology were encouraged, stimulating the local sustainable construction & engineering industries. 

    After providing the “carrot” the government then adopted the “stick” of increased regulatory control. The revised Building Code of Australia (BCA) released in 2010 included new mandatory energy efficiency and emissions reduction measures for all new buildings. Also in 2010 the Building Energy Efficiency Disclosure act was passed mandating the disclosure of a NABERS Energy rating for all office sales and leasing deals over 2,000 sq. m.

     Singapore’s status as a regional green building leader also owes much to its implementation of a strong regulatory framework and provision of market incentives. The launch of the very successful Green Mark rating system in 2005 was followed by the 1st Green Building Masterplan in 2006, under which all new and major renovation projects for public buildings had to be at least Green Mark certified. In 2009 it was mandated that all new public new build projects must be Green Mark Platinum, while all existing public buildings owned by government agencies must achieve a Green Mark for Existing Building rating of at least Gold by 2020. 

    The legislature also set a framework to mandate that green building opportunities are not missed by the private development market. As of 2008, all new buildings and major retrofits of existing buildings over 2,000 sq. m must by law meet the minimum requirements of Green Mark. Green Mark standards were also set as a condition for public land sales. In 2009 the government launched a S$100 million fund to help fast track energy efficiency projects in existing buildings as part of the 2nd Green Building Masterplan by funding up to 35% (or S$1.5 million) of energy retrofit initiatives per building. Private developers are provided with incentives to build green buildings with an additional 1% (capped at 2,500 sq. m) and 2% (capped at 5,000 sq. m) of GFA being awarded to Green Mark GoldPlus and Platinum projects accordingly. 

    According to the BCA, there were more than 1,000 Green Mark building projects in Singapore as of February 2012, reflecting the widespread and indeed hugely successful adoption of green building practices in the city state. Key to this market transformation has been the aforementioned government green building master planning and framework coupled with the development of a green building benchmark designed specifically for Singapore’s tropical climate. Singapore impresses not just by the pace of green building adoption, or the sheer numbers of green buildings it now boasts, but also by the industry-leading technologies and practices being employed in the market. 

    There are now many examples of green building best practice across all real estate sectors that justify Australia and Singapore’s status as regional green building leaders. Their respective governments’ commitment to continual improvement and local developers’ enthusiastic adoption of green building practices, combined with greater corporate and environmental responsibility among global corporate occupiers, will ensure we see higher standards and further innovation by these markets in the near future – other countries across the region looking to catch up would do well to follow in their footsteps. 

    Jonathan Hills is Associate Director at CBRE Research Asia Pacific

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