property & sustainability - oisdoisd.brookes.ac.uk/pressreleases/media/rics2007shiers2.pdf ·...

School of the Built Environment

‘Sustainability and Property –Some Current Issues.'

David Shiers Department of Real Estate and Construction

Miles KeepingKing Sturge LLP


Technical Economic- making property more sustainable by minimising environmental impact


“A Green Profession?: RICS Members and the Sustainability Agenda” 2007

Key findings: RICS Members believe the most important sustainability issues are:

• Energy supply, • Land contamination, • Resource efficiency and • Transport.


“A Green Profession?: RICS Members and the Sustainability Agenda” 2007

• International survey of 47,000 RICS members

The most important drivers for sustainability for RICS globally are:

• Legal compliance• Professional responsibility to protect the environment,

and • Personal ethical and moral reasons.www.rics.org/NR/Agreenprofessionfinalreport.pdf

http://www.rics.org/NR/Agreenprofessionfinalreport.pdf


Consensus views from the survey…

• “…sustainability highly relevant to their work, but key barriers (such as lack of knowledge and expertise) are making it more difficult for tools and other information to be used effectively in professional work.

• key drivers for sustainability are based around ‘reactive’ factors such as legal compliance and responsibility for the environment, rather than competitive edge or business bottom line.

• Client-driven demand for advice is important. • Evidence of a gap in the coverage of the economic and social

components of sustainability tools and, in some instances, confusion as to which tool or technique is appropriate.”


“Surveying Sustainability: a short guide for the property professional” (RICS, Forum for the Future, Gleeds. June 2007)

Includes:• Greenfield / Estate management• Planning and procurement• Construction• Occupation and use (including refurbishment)• Demolition and remediation• Sources of further information

www.rics.org/Environmentalandlandconsultancy/Sustainability/Surveying250607.htm


Drivers of Change – clients adopting CSR policies

• Prudential• Gazeley• ProLogis• Hammerson• Crown Estate• HSBC*• Unilever*• BP*• Co-op Bank*

*Customers are the public – imperative to demonstrated engagement with S D…Adoption can mean better business, greater profits, less risk, more appeal…

• Ford* • Shell*• Virgin*• Wal-Mart*• Tesco*• Sainsbury*• M & S*• Morley / Igloo• …


Sustainability and Property…

Increasing interest in sustainable development in the property sector…• SRI/CSR

“We expect companies in which we invest to be able to demonstrateand report on appropriate environmental policies...We are unlikely to hold shares in companies where we are not satisfied with the appropriateness of this environmental policy or ability to manage the risks associated with environmental impact”

Prudential Annual Report, 1998

Push and Pull factors…business case for sustainability, increased regulation, adverse PR for the environmentally irresponsible…£ and legal risk, perceived £ advantage for greener organisations – reduced energy, waste etc…


Comparative performance of “sustainable stock” v others

DJSI v market ‘norm’ since launch, 08/99 – 08/07(EUR, Total Return)



• Regulatory demands“The property sector in general and, more specifically, the design,

construction and occupancy of buildings, have been identified as key areas in which more could be done to reduce energy consumption, provide healthier, safer working and living environments and minimise waste.”

• Higher building insulation standards - recent amendments to Part L of the Building Regulations (see http://www.safety.odpm.gov.uk/bregs/index.)

• In 1994, a Landfill Tax was introduced which required contractors to pay a tax for every tonne of waste going to a landfill site: currently, this is set at £15/tonne

• Climate Change Levy - £.43/kW for elec. and £0.15kW for gas and coal - to make businesses more energy efficient

• Aggregates tax - to stimulate demand for recycled materials £1.60/tonne on sand gravel and rock

http://www.safety.odpm.gov.uk/bregs/index.htm


Drivers of Change…legislative

EU policy documentsOngoing• 6th Environmental Action programme of the EU 2002-2012• European strategy for sustainable development (2001)2004• EU Directive on Strategic Environmental Assessment (2001)• EU Directive on Waste Electrical and Electronic Equipment (2002)2005• EC Communication: Equal opportunities for people with disabilities –

a European action plan2006• EU Directive on the Energy Performance of Buildings (2003) –

being updated already!2007• EU Directive on taxation of energy products and electricity (2004)


‘Code for Sustainable Homes’

• Replaces EcoHomes• Assesses nine areas of a development including

Energy, Water, Materials, Surface Water Run-Off, Waste, Pollution, Health and Well-Being, Management and Ecology.

• Each dwelling assessed individually, unlike EcoHomes which was whole site assessment.

• Once built, dwellings required to undergo a Post Construction Review.

• May become mandatory for ALL new homes



• UK construction: c. 30% of all controlled annual waste. • 44% of UK’s CO2: heating, lighting and cooling buildings

• 26% residential; 18% non-resi’ sectors.• 60% target reduction in emissions by 2050 (Energy White Paper).

(See www.sustainable-development.gov.uk)

• 13m tonnes of construction waste is new materials delivered to site and never used!

• 25% of UK energy consumption = production and transportation of construction products and materials

• 50% of water is used in buildings

http://www.sustainable-development.gov.uk/


‘The Business Case’ - Occupier demand for greener property

• “…the real cost of energy is set to increase above the rate of inflation. Energy inefficient buildings could see their costs of occupation rise and, in a competitive market, compensated for through lower (than otherwise) rents, rental growth may be hindered”(McNamara, 2000)

• Q. will energy inefficient buildings become less appealing?... E.g. OBU property – energy costs 117% rise for electricity 47% for gas between 2003/4 and 2005/6


Reducing the environmental impact of property


Barclaycard


Devonshire Building, University of Newcastle


BedZed


Tower 42

• Green refurbishment –Seifert ‘BREEAMED’!


RES Hertfordshire

• The ‘greening’ of the former Ovaltine egg farm


‘The Business Case’ - Property investors intentions

• Not enough green buildings out there for green investment funds?

• Seeing the emergence of ‘Tracker Funds’ … e.g. Prudential “Improver Portfolio” – 25 properties valued at +£500 million - aim is to improve sustainability performance, monitor financial performance and enhance value.

• NB i) energy still a small % of business operating costsii) decision on location, occupation of a building normally HR driven decision


‘The Business Case’ – Green Values

• Costs of inaction = increasing obsolescence. Energy performance – if 2005 25% more efficient than previous, by 2015, buildings will be 75% more efficient (NB now legal requirement to update Building Regs every 5 years)

• Green retrofitting can improve productivity (for examples; see RICS Green Value) – some good evidence. Greening the property can add value – easier to let, lower tenant turnover, grants and awards, enhance asset value

• Valuing sustainability …no satisfactory approach as yet: need for rigorous, accessible techniques and processes. Can ‘value’in terms of adding desirability and appeal and reduced risk of litigation and future energy legislation?


‘The Business Case’ – Developers issues

• New buildings – is BREEAM ‘Excellent’ v ‘Very Good’value for money? ( i.e. + 7.0% v 0.2%; BRE, Cyril Sweett & Partners)

• ‘Merton Principle’ – in some local plans requiring 10% of energy to be from on-site renewable sources! i.e. solar, wind turbines, CHP – achievable? Government to make national policy to achieve C-impact of property?


How to tackle energy consumption

• Identify worst performing buildings – metering? Services engineer report? (refer to ECON 19 Govt Guidelines)

• Oxford Brookes* experience – energy performance as proxy for poor performance generally:

Age/ time since last refit = functionality (useable space, circulation, general condition = energy performance/ consumption

*value of property = £260 m


How to tackle energy consumption

• Retrofit worst offenders: improve insulation in walls, roofs; fit low-energy lighting; reduce solar gain – external louvres, coatings to windows or re-glaze (upgrading form single to double low-e = 70% better thermal performance of glazed areas); replace boilers; install lighting sensors or add BMS

• Low-energy lighting can reduce o/a energy by 4-10%• Cost/benefit analysis required before major retrofitting,

demolition or disposal – ‘Office Scorer’• Engagement with v screening of tenants e.g. Prudential CR

Report 2002; office in Reading; over 3 years energy use reduced by 45% ( £150,000 saving) through engagement with tenants – inform and educate about environmental management of their space; energy, waste management, water, indoor air quality etc


Energy

EPBD due in April 2008• Terms and scope unclear and ambiguous e.g. ‘public buildings’

‘frequently visited’• What will happen where pubic authority is one of several

occupiers of a multi-let property?• Recommendations do not have to be implemented. • Government estimates need for 2000 assessors. As of mid-may,

only 520 had been trained. If short, may apply only to larger buildings as per HIPs

• Will probably need judicial decisions to resolve questions of interpretations

(see paper on IPF website on EPB Regulations, Miles Keeping, July 2007 &

Efficiency Drive, Thomas, Keeping and Lavers; article in New Law Journal , June 2007)


How to tackle Materials Specification

• Potential for greatest impact – carpets! – solution, avoid PVC backings e.g. specify ‘natural fibre’ backings or ‘recycled rubber crumb’, (see Interface range of carpets)

• Water-based paints

• Timber from sustainable sources (check for FSC Certification)

• Recycled materials* where possible

• Natural products where possible (esp’ for finishes) but not insulation! – see ‘Green Guide’


How to tackle Transport

• ‘Green Travel Plans’ - on new / extended buildings, speak to Local Authority & be ready to negotiate

• Refurb’ v redevelop: if new, may lose high car parking ratio!

• Existing provision - need for clear policy! Targets – audit, plan, do, review

• Car-sharing, inter-site buses and working with local providers, bike facilities & interest-free loans, ‘trees for air/car miles’


‘How to bring it all together’ – an Action PlanRecommendations for Achievable Ways Forward for OBU

• All new Brookes buildings and major refurbishments to achieve BREEAM Excellent standard (say within two years - Jan’ 2008)…Including new flagship building

+ ‘Quick wins’• Building materials - all paints and carpets to achieve ‘A’ rating

according to Green Guide to Specification, e.g. no PVC-based products in carpet underlay, no hardwoods from non-sustainable sources

• Purchasing strategies – all suppliers of office stationary, cleaning and building repair materials to provide environmental policy statements - Brookes to set standards through EMS

• Complete energy & emissions audit of individual buildings –prioritise improvements to insulation, low-energy lighting etc

• Transport issues ‘Greener Oaks’ tree planting scheme – on basis of overseas student air miles…?

property & sustainability - oisdoisd.brookes.ac.uk/pressreleases/media/rics2007shiers2.pdf ·...

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