Sustainability drivers

The 'push' effect is produced by the business drivers. These provide pressure on us to develop and construct more sustainably and can either be calculated financially or can be more subjective 'soft' issues.

• development drivers;
• financial incentives;
• investor pressure; and
• occupier pressure.

The above business drivers clearly do not apply to all developers, owners or occupiers across the board: the disjointed effect of separating capital costs from revenue costs for all but the owner/occupier has a big impact on reducing the effectiveness of many potential financial benefits viewed over the economic life of the building and when looking at life cycle costing. One of the big challenges is to improve links between capital and revenue costs in the commercial property sector to achieve more sustainable buildings, which generally lead to lower in-use costs and total costs over the building life cycle.

This has been encouraged recently in the public sector through interest free loans to finance the capital expenditure, which can then be paid back via savings in the revenue, and via Salix, an independent not-for-profit company set up by the Carbon Trust. The company has so far funded over 14,450 projects with 1,460 public sector bodies, valued at £462.9m. This has saved the public sector £116m annually and £1.7bn over the project’s lifetime – exceeding its aim to deliver over £750m of energy bill savings – a clear indication of how investment can bring savings many times the original capital cost.

While the 2008 recession had an impact on the importance of sustainability, there is no doubt that since coming out of recession there is again a renewed interest in improving the sustainability of buildings from both an occupier and an investor/developer perspective.

Development drivers

Developers are increasingly offering a sustainable solution to help obtain planning permission for new developments and in some cases to attract the right calibre of occupier.

The public sector is also increasingly using its position as a land holder to engineer sustainable principles and construction into a development as a requirement for choosing the developer or joint partner. ProLogis were selected by Advantage West Midlands (AWM) for a 64-acre development site on the former Sideway Colliery near Stoke on Trent, due in part to the sustainability of their development proposals. For another site at Chatterley Park, AWM selected Gazeley, due to the sustainability credentials of the development - the proposal for the 12.5ha (31 acre) distribution site is the UK's first truly carbon positive site, creating a tradable carbon surplus, with all of its energy coming from renewable sources and the site exporting enough energy to heat and power 3,100 homes.

The East City Point scheme in Canning Town in the east of London is being developed by 3 private developers on land owned by the London Borough of Newham. It has an energy centre that will run partly on bio-mass which was a requirement of Newham Council. This is an example of Local Authorities being able to influence the sustainability of developments apart from through the planning process.

Occupier pressure

One study by the American Medical Association (AMA) indicates that health problems resulting from poor indoor air quality can be costly, with 150 million work days and $15 billion lost in productivity every year (Rocky Mountain Institute, 1998). More broadly, a number of studies have linked high-quality working environments with reduced absenteeism, higher staff morale and improved productivity.  

For example, Health, well-being and productivity in offices: the next chapter for green buildings (World Green Building Council, 2014) made a number of key observations, including that:

• better indoor air quality (lower concentrations of CO2 and pollutants, plus higher ventilation rates) can lead to productivity improvements of 8–11%; 
• thermal comfort has a significant impact on workplace satisfaction and even modest personal control over room temperature can return improved productivity;
• the way the interior of an office is configured (including workstation density and configuration of work space, breakout space and social space) can affect concentration, collaboration, confidentiality and creativity; 
• health can be improved through exercise, so active design within a building, and access to amenities such as gyms, bicycle storage and green space can help to encourage occupants to live healthier.

Anecdotally, Jones Lang LaSalle also found that after their Hong Kong office moved to office space fitted out to obtain the highest LEED Platinum score in the world, absenteeism dropped by 41%. 

The British Council for Offices is also carrying out a range of research projects studying the link between building design, performance and sustainability.

Certain private sector occupiers, particularly retailers such as Marks & Spencer and Waitrose, have stated CSR policies that will be judged by their shareholders; occupying buildings that can demonstrate their sustainable credentials will be a part of this. We have seen an increase in the number of firms looking for more sustainable buildings for not only their headquarters, but also their other properties.

The public sector has for a number of years required the highest BREEAM ratings, typically that all new buildings that it occupies need to have a BREEAM rating of 'Excellent' and any refurbished buildings to be 'Very Good'. 

A useful guide has been produced by RICS, Carbon management of real estate, to assist those advising clients or employers occupying large or small properties.

There is no doubt that a more careful choice of materials, in particular paint and carpets, cleaner air handling systems and greater individual control can all assist in providing healthier working and living environments. A green approach can also reduce the risk of litigation for building occupiers: the US is seeing an increase in the number of lawsuits relating to sick building syndrome.