15 March 2012 – On lovely low carb(on) diets; some numbers for the bean counters; and revolution and passion storm the financial news hubs of civilized society as we know it. There’s a gathering head of steam in the sub-prime commercial property market and it’s clean and green. On Monday 27 February Parramatta City Council passed a motion to approve its involvement in environmental upgrade agreements.
This follows the City of Melbourne’s early adoption of the scheme, the City of Sydney’s jump into the action soon after and the likelihood that other councils such as North Sydney will follow.
To emphasise the point The City of Sydney on Thursday announced it had signed a memorandum of understanding with Low Carbon Australia (new heroes on the block) to encourage investment in “low-carbon technologies by businesses, owners’ corporations of apartment buildings, and government.”
City of Sydney chief executive Monica Barone said the federally funded LCAL [Low Cal?] and the city would “organise seminars, workshops and develop marketing materials to encourage building owners and tenants to invest in energy-efficiency improvements. They will also collaborate on research, case studies and educational materials.”
LCAL CEO, Meg McDonald, said: “Through our partnerships with major organisations including NAB, Macquarie, Alleasing and Origin, we can provide financial solutions to cover the start-up costs of energy-efficiency upgrades.”
If you don’t know what EUAs are you’ve been living on Mars…or down that rabbit hole where the weird people go to hang out with Ian Plimer & Co.
- Get a quick download on EUAs at our post: Collections: Environmental Upgrade Agreements – the full archive of articles
Essentially EUAs take away the pain from retrofits for energy efficiency, by making the loan repayments a local council matter. The council adds a levy to the rates, the landlord gets to not worry about paying for something the tenant will benefit from, and the tenant gets cheaper energy bills.
That’s the theory. If you are still not sure, pick up the phone and call Matt Fisher who has recently been employed to run the EUA program for Parramatta.
Or Philippa Sutherland at the City of Sydney who was also recently appointed in a similar role for the big(ger) end of town.
Fisher’s appointment follows his recently completed analysis of the retrofit market for commercial buildings, which he carried out on behalf of the Total Environment Centre, with funding from a NSW’s Environment Trust grant. (NSW Environment Minister Robyn Parker recently flagged this kind of leadership for her state. Let’s hope other states, such as Queensland, SA and WA follow suit.)
Fisher has collected some great stats on the retrofit market during the course of that work. He says the average age of CBD office building stock Australia-wide is 19 years.
C and D Grade buildings, he says, represent 20 per cent of building area and B Grade 34 per cent. “The age of the buildings in the lower quality sector is likely to be much older,” he says.
This means many buildings are getting near their use-by date of 20 to 25 years for items such as plant and equipment.
The TEC project, Lessons and Tools from Existing Office Building Leaders, also tips in knowledge and experience from industry specialists such as Paul Bannister, Gavin Gilchrist, Steve Hennessy, David Mountseer, Bruce Precious, and Roger Walker.
It’s also compiled six detailed case studies on buildings that have been retrofitted and achieved significantly improved environmental and financial performance.
About mid year the TEC will present the information and insights in two free forums targeted at building owners, building managers, property management groups, and other relevant stakeholders of under-performing or older buildings.
Here’s a headlines sample of what to expect.
A: This case study presents a significant repositioning of an older C Grade building in Parramatta into a premier asset.
- Dated older style C grade building with aging plant
- $2 million project cost for environmental related works
- 1 star to 4.0 NABERS rating within12 months
- 50 per cent energy saving
- $96,000 a year. reduced outgoings
- Estimated $6 million increase in building value
- 16 per cent rent increase (pre-completion); 25 per cent expected post completion
B: This case study (Royal Prince Alfred Medical Centre) presents a dramatic improvement in building performance with low capital expenditure and good economic returns:
- Large Medical Centre with 56 office suites
- Project cost – $185,000
- 0 star to 4.0 NABERS star rating in two years
- 52 per cent energy saving
- 20 per cent reduction in water use
- $84,000 saved per year
- ROI 1.6-1.8 years
C: This case study presents a B Grade building with vastly improved performance achieved largely through very careful building tuning alone.
- No plant upgrades
- 30 per cent reduction in electricity use.
- 50 per cent reduction in gas
- Improved tenant comfort and amenity
- 44 per cent in water consumption
- Careful monitoring and tuning has ensured that plant is run at their optimum and achieves a high level of efficiency.
- The payback is almost immediate as the works have largely been part of general building maintenance and good management
You want to know more don’t you?
Stay posted for the details.
A revolution in the City?
It takes a while to sink in. But there it is, a full page ad for subscriptions in last Saturday’s The Australian Financial Review.
There’s a strange green landscape; a girl standing on a hill surveying her kingdom (Gina?), a bit of pink colouring (to signify play?) a golden sky, reminiscent of Wizard of Oz.
The heading is “we’ve revolutionised the price. Now we’re revolutionising the agenda.”
This is a major daily financial newspaper. Well, the only one. A respected organ of business. And here it is talking about an agenda and a revolution.
“We believe Australia’s economic and political landscape has arrived at a defining moment.”
Note more key words: “landscape”; “believe”. This has got focus group all over it.
For “believe”, read “passion” and “authenticity.”
- See our recent mega post on Green Capital’s session on how to spin the green message and win. How to win at media and marketing
For “landscape”, read “green stuff,”
“Embrace the future and take action,” the ad says.
“We’re focusing on the defining issues that affect us all…So we’re creating an agenda that champions change…”
It’s all about building wealth of course, getting richer.
But the clincher is the final words: “Join the movement.”
We’re not sure but we think that when one of the most business centric, conservative centres of opinion in the country uses this sort of language –revolution/change/landscape/agenda/movement – to sell an ad, something fairly major is going on.
It could be just marketing hype but it’s the marketing department that is always the first to spot a trend and they are usually right.
Yes, revolutions are now hip. Change is good, landscape is a fine thought. Impartial reporting is out: agenda is in.
Now get ready for the next step: connecting wealth building with “sustainably” “ethically” “fairly”.