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Green buildings attract premium rentals, more occupancy, says report

Lower operational costs, an improved indoor environment and low carbon footprint attract homebuyers to high-performance buildings.

February 24, 2023 / 12:22 IST

Green buildings typically attract higher rental premiums and occupancy rates, prompting developers to prioritize sustainability in their real estate portfolios, according to a report by real estate company Colliers and the Royal Institution of Chartered Surveyors (RICS).

The report, titled Enabling Net-Zero Built Environment, said green buildings also deliver higher returns and increased workforce activities.

Benefits such as lower operational costs, an improved indoor environment and low carbon footprint mean that “homebuyers are increasingly preferring high performance buildings," the report said.

“Decarbonization of the built sector is pivotal in achieving global carbon reduction goals, paving the way for a more sustainable and greener and an inclusive future. It is imperative to adopt a lifecycle approach from construction to operation and maintenance and the final disposal of the built structure,” said Vimal Nadar, Senior Director and Head of Research, Colliers India.

“This necessitates a collaborative approach amongst investors, developers, and occupiers to achieve net-zero commitment. They need to identify aspects and create strategies around sustainability, to especially lower carbon emissions,” Nadar added.

The report added that homebuyers and developers are collaborating by entering into green leases. Green leases are agreements between landlords and tenants in which both parties undertake specific responsibilities to improve the building's environmental performance.

“The government is also currently revisiting its existing environmental policies and is making efforts to make them more holistic and comprehensive. Initiatives such as Green Hydrogen policy and National Solar Mission are expected to further boost decarbonisation efforts in the country,” the report said.

According to the study, homebuyers should opt for entering into green leases with the developers, reduce operational emissions through efficient space management, and use technology to optimise the efficiency of building services.

Additionally, developers should adopt the design to decarbonise a structure from the planning stage, redevelop existing buildings, especially in terms of renovations and replacement of materials, and focus on efficient management of carbon emissions during the deconstruction of a building through recycling and reusing of residual waste.

The report suggested that the government increase investments in research and development, create a standardised building code, and provide incentives for green retrofitting and development of high-performance buildings.

Colliers, in collaboration with RICS and the Australia-India Council, took part in a three-part series of events focused on embodied carbon in the built environment and solutions that can enable change. The report is based on the events.

Moneycontrol News
first published: Feb 24, 2023 12:20 pm

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