16 November 2011 – Architects need to search harder and wider for innovative solutions to get the best return on investment for their refurbishments and retrofits.

It’s well documented the building industry contributes to approximately 40 per cent of greenhouse gasses produced in Australia; and that the quickest and easiest way of reducing of carbon dioxide levels can be achieved from within this sector.

Comparing the energy required to demolish and construct a new building, to that of repositioning or enhancing existing building stock, science suggests that we can achieve higher sustainability outcomes through retrofitting.

In fact, the greatest challenge and opportunity for improving environmental outcomes is to maximise the use and efficiency of existing building stock. Occupation and re-leasing of available space as quickly as possible is both important from a sustainability initiative and beneficial to the asset value of a property.

The embodied energy contained within an existing building stock or the energy required to demolish and construct a new building suggests we can achieve higher sustainability outcomes by repositioning or enhancing existing building stock.

In fact, the greatest sustainability challenge and opportunity for improved environmental outcomes is to improve the use and efficiency of existing building stock. Occupation and re-leasing of available space as quickly as possible is both important from a sustainability imitative and benefit to the asset value.

Location and presentation of the address remain key drivers for any tenant choosing a building. From an architectural perspective, a well presented street frontage, the impression of a quality public foyer and the pathway leading to a tenancy front door, remain important to any refurbishment as they have in the past.

However, refurbishments cannot rely on this cosmetic upgrade alone. Workspace benefits including improved health and wellbeing as a result of the indoor environmental quality advancements of green buildings means that tenants are more knowledgeable about what they want to get out of a new workspace.

Particularly if environmental and social aspects of triple bottom line initiatives show to increase workspace productivity and the ability to attract and retain staff. The quality of the workspace, the building in which their office is located and the surrounding precinct amenity, all have an effect on business owners choosing a tenancy space.

If the base building can provide more to support the workspace environment, the more attractive it will be to potential tenants. Hence, today’s refurbishment market calls for more innovative solutions to be considered to future proof any refurbishment or retrofit of an existing building.

Similarly, service upgrades typically focus on replacement or upgrade of existing plant as part of a maintenance program. Service engineers and facilities managers need to consider what opportunities exist to convert existing services infrastructure to support aspects such as improved IEQ conditions, as we see in the new green buildings.

To support the tenants workspace amenity (health and well being), not simply tinker with the existing conditions.

Architecturally, we need to look at advancements in new builds to match the amenity offer in refurbishment projects.

The quality of space, improved natural light and outlook, thermal comfort, quality of fresh air, and flexibility of services are important.

These considerations don’t necessarily have to be complex or costly. For example, in many commercial buildings, there are lots of redundant spaces that have hard to lease left over space in lower or basement levels, which can be transformed into practical social spaces – showers, gyms, bicycle storage etc.

The provision of quality barista bars, cafes and informal meeting spaces in foyers all assist with reducing the demand of space within tenancies and add value to the lease potential and building value.

As tenants become more knowledgeable about being sustainable and desire greater energy efficiency, architects, engineers and facility managers need to raise the bar.

More than ever, tenants are actively looking at NABERS ratings, energy efficiencies and in-built sustainability considerations found in contemporary green buildings such as the Docklands.

Architects can no longer afford to ignore these elements or consider them in isolation during a retrofit because this will not give the return on investment.

Tenants will see through this and see these glaring holes in your project. Naturally, we only have a limited budget and we can’t do everything at once, so we must spend budgets wisely across the entire upgrade, not just on one building aspect, but look at it holistically to have a better outcome.

In the 29,263 square metres (PCA A Grade) refurbishment project at 321 Exhibition Street, Melbourne, (former Australia Post building) the challenge for Gray Puksand was how to commercially integrate energy efficiency into the existing infrastructure and achieve benchmark sustainability targets including well considered social aspects to support the amenity of the building.

321 has been certified GBCA 5 Star Green Star Office V3 and is targeting 4.5 star NABERS as a minimum. The final NABERS rating is likely to be higher.

The tenant was unknown when the refurbishment design and submission for Green Star commenced. Essentially this was a speculative development, unlike most new commercial developments, which require a substantial pre-commitment and known tenant integration process for financing the project.

The brief was to achieve minimum government standards for energy and sustainability targets for a refurbished building.

321 was designed late 80’s and built early in the 90’s. The services including a variable air volume system were the typical commercial grade of that time.

The existing system was in reasonable condition, yet in need of upgrade to match the performance of say, most contemporary Docklands’ buildings.

The punch window façade also had reasonable performing glass and insulation properties that suggested a facade upgrade (other than street/podium level presentation upgrade) and was not cost-effective.

The extensive mid-height plant room enabled growth space for a tri-generation plant, which was essential to the energy efficiency of the building.

The reduction of CO2 due to direct energy source assisted with Green Star and NABERS energy targets. The plant enables uninterrupted power for the base building and tenant alike.

The exhaust gases heat the absorption chiller, providing chilled water without the need to run electric chillers. The capacity generated enabled more efficiency and control of the VAV upgrade to suit tenant demands with a benefit of 100 per cent fresh air (increased from 15 per cent previously) for the majority of suitable external conditions as a bonus.

Selection of appropriate interior base building finishes and air distribution ensures a high level of indoor environmental quality to match any contemporary green building.

A well-presented foyer that retained (or concealed) as much as possible existing finishes in lieu of sending them to landfill were enhanced; a new street level façade to open up the foyer was designed with disassembly in mind for future use; provision of informal meeting spaces surrounding a café and other food hall initiatives additional support to the tenancy above.

196 bike storage facilities, 22 showers and 216 locker space support user amenity, while the CBD location is well supported by public transport access. A total of 265 tonnes of material were recycled as a result of the refurbishment.

Pre-determined digital lift control floor access vastly improves access throughout the building. High levels of water saving initiative; co-mingled waste control; and a building maintenance service control linked to extensive metering enables the building to be managed efficiently to achieve sustainability, initiatives akin to any new building.

A dedicated web link ensures tenants have access and knowledge to the building management operations, performance, and surrounding precinct amenity to “know what’s going on”.

The energy upgrade of 321 was enabled with the additional support of maximum funding under the Commonwealth Government’s Aus Industry Green Building Fund.

The real challenge for sustainability within the refurbishment market is how to improve the B Grade and below stock.

These are typically lower grade, older building stock with greater challenges (particularly energy savings) and higher costs to achieve improved sustainable outcomes for lower rental return.

The lower rental markets attract smaller, multiple floor tenants with less knowledge, resources and drive to be “truly green”.
In this tenancy market, everybody wants to be seen as green; however, the commercial charters, such as corporate reporting are less driven.

Aligning with this, these buildings are typically smaller building owners who have less knowledge and resources on how to green their building.

These building owners are more likely to be driven to initiatives by either reducing operational costs due to improved energy efficiencies (which will become more apparent as electricity or utility costs increase with carbon tax policies) or social sustainability incentives that attract tenants to release buildings as quickly as possible.

A common problem for B Grade buildings is the need for substantial upgrade of services as the initial plant and system is often well beyond life cycle, or simply performs out-of-date relative to contemporary requirements.

The matrix of upgrade cost relative to rental return makes it prohibitive to complete an entire upgrade, typically building owners and facility managers search for cost effective means of maintaining existing plant to get more life out of them.
The result is the building continues to underperform and innovative solutions for services need to be soughtt, rather than simply maintain the building.

A common aspect in most buildings of this era is they all rely on hot water to service HVAC systems.

If we look to overseas examples, like the City of London, or many other European cities, a potential solution exists with the introduction of district energy supply. Either locally generated power or better, reticulated hot water will provide the opportunity for these buildings to be improved from an energy efficiency perspective.

The building owners of 321 Exhibition Street attempted to install a larger co/tri-generation plant and had taken up district energy supply; however, they were prevented by Retailing Acts to sell power across a property boundary line.
Much has been said of this opportunity and governing bodies are in the process of looking at this issue.

Private enterprise opportunities to integrate district energy supplies like 321 Exhibition Street are rare and need to be taken advantage of.

A similar picture can be painted for institutional buildings, where substantial volumes of existing buildings are challenged by building management organisations that have fewer resources, knowledge or funding streams to improve their sustainable outcomes.

Upgrade of services as part of maintenance programs are a common driver for refurbishment.

In recent times, refurbishment of institutional spaces has been driven by the need to increase flexibility of use within a space, akin to what we see in new Institutional buildings. To get more from less.

From the 321 Exhibition Street project and looking at many refurbishments across Australia, local players need to search for smarter solutions when retrofitting. Architects need to move away from seeing a property statically; to consider retrofitting as a dynamic process. This means exploring innovative methods such as off-site construction to enhance the use of current space.

If we want to increase the asset value of an existing building, then we must examine the building opportunities more holistically, look more deeply and broadly at the opportunities, and not just focus on the appearance of the building or maintaining existing services.

As in new builds, this holistic approach is important to future proof the refurbishment or retrofit costs.

Ultimately, it’s the architect’s duty to engage with tenants to understand how they use the current building and its facilities and from this, anticipate what they may require in the future.

If these conversations are fruitful, they will provide innovative retrofitting ideas and truly add value to a property.

Paul de Podolinsky is a partner at Gray Puksand. He leads the sustainability practice and refurbishment projects at their national practice.

He will be a speaker at the Retrofitting for Energy Efficiency Brisbane event to be held in January 2012. See: Details www.Retro-fitting.com.au/Brisbane download the brochure and agenda or email enquire@iqpc.com.au