Green fever: 20% of the office stock is certified, more to come

Even if the share of the green office area is minor compared to the stock level, it is though a huge growth if compared to 4-5 years ago, when this type of projects was just a dream. Moreover, compared to the total A class office space, the share of the certified green offices exceeds 58%, according to the data provided by DTZ Echinox.

Of course, even nowadays we consider different degrees of green, some of them only small basic investments, but the trend is hopeful for the future tenants who could benefit from reduced costs.

What is known for sure is that the share of the green offices will substantially grow from year to year, considering that the new offices in construction such as Floreasca Park or Green Gate are already raise the standard in the field, but also the investments that the owners of some buildings completed in the first office wave are ready to make in order to be competitive in regard with the new standards and keeping up the building values.

The companies’ appetite for green certifications also shows in consultants business. For exemple, Colliers started the year with 8 projects in course of certification – both office buildings and commercial centres - , as a result of the growing need of the owners to reduce the operational costs and increasing the value of the assets in their portfolio.

"There is no new office project without a green certification"

"The green certification concept becomes more and more popular within the real estate developers on the local market. Actually there are no new representative office projects announced without aiming a green building certification. The reasons are countless but among the most important we mention the significantly higher possibilities to trade the building as a premium product, having at the same time the advantages of a reduced property tax, offered by the local authorities in cities which number is constantly increasing”, has declared Andrei Nemes, senior project manager, LEED Green associate within Jones Lang LaSalle.

It is also important to mention that the current trend of certification is identified within the buildings already functional, with an average age – approx. 10-15 years.

"In other words, the first projects developed in Bucharest professionally by specialized juridical entities, also represent part of the first wave of buildings aiming for green certification, “operation and maintenance”  type (regarding the relatively easy acquiring process), as the next logical step on the priorities list within asset management", has added Radu Vasilache, senior project manager LEED Green associate within JLL.

What means the Operation and maintenance certification type?

Nemes explained that if the certificate obtained for the new buildings or for a major refurbish is valid through the entire construction life time, and the cost is paid only once, an Operation and maintenance certification type refers, limited, to the manner the building is operated (LEED EBOM, BREEAM M&O) and has a validity term of 5 year maximum, bringing periodical costs for recertification.

Regardless of the certification type, the green certifications have however exploded this year, on the background of expiring the lease terms, and the concurrence of the office market is fierce.

"The owners started to be more and more interested in certifying their buildings in order to optimize the operational costs, so that to offer competitive conditions to loyalty the existing tenants, but also to attract new tenants ", also said the DTZ Echinox specialists.

The certification also represents a measure owners take in order to preserve the value of the assets and to prepare in respect of a sale, but also expecting some regulations that would reduce property tax for certified buildings – a measure already implemented in Cluj Napoca for instance, DTZ officals added.

What are the costs?

Nemes shows that building sustainably doesn’t mean building more expensively, and the evaluations on the CEE market show larger costs, limited between 2.5% by 6% of the investment value, considering the aimed certification level.

The amounts the owners are ready to invest in their buildings energy performance improvement vary considering the project scale and the aimed certification type. Therefore, the owners can implement basic efficiency solutions of some dozens or hundreds thousands euros, but the investments can also reach millions euros (the case of West Gate and Novo Park projects which have obtained  BREEAM „Very good” certification following EUR 1.5 - 3 million), said Razvan Iorgu, the head of CBRE Romania.

And… marketing

The statute of green building starts to be seen by the owners as a marketing advantage. But is it only marketing? The large range of certification types makes the green statute very flexible, and as the trend is obviously eco, they all emphasize the green concept. Robert Neale, head of Portland Trust has recently declared that many owners talked about green certifications, but many times those are just words without substance.

The differences between an operational certification and a building currently developed in order to get a good certification are definitely big. Though, once a new standard is brought on the market it is expected that most of the new A class buildings to try to get a higher standard in certification, and the shares of the green certificated with very good standards will be larger and larger. (source: wall-street.ro)