By Tina Perinotto
-Welcome to 2010, and to our readers, our contributors and to our wonderful supporters and sponsors. Get ready for a rough ride in the year ahead.
After so many great signs last year on climate change action, a late and powerful swing to the sceptics halted the emissions trading scheme at the national level, and in Copenhagen China stunned observers with its willful obstruction of any meaningful agreement. (See what Mark Lynas had to say on this in the Guardian ) Now we have to endure a national procession of climate sceptics such as Ian Plimer and Lord Monckton urging us to do nothing; they may as well be urging us to play Russian roulette.
On the positive side, absolutely none of this matters to the property industry. The indications are that jobs growth in the sector will rocket along this year, propelled by entrenchment of the notion that we all need to become more sustainable – and the ebbing of the financial crisis.
This industry gets better and better at sustainability and has no intention of stepping backwards, regardless of the politics and grandstanding elsewhere.
The good news this week confirmed what many people already knew – that Australian really is leading the world in sustainable property. In the inaugural Environmental Real Estate Index study conducted by the highly respected academic Nils Kok of Maastricht University, GPT has been named the world’s most sustainable property company in a field of more than 600 companies. Stockland came third; Commonwealth Property Office Fund came fifth; CFS Retail came seventh, and Valad 13th.
Stockland’s Siobhan Toohill, general manager corporate responsibility and sustainability, certainly has no doubts that there will be plenty of forward movement this year.
The big driver ill be energy efficiency, she says, and Rowan Griffin, head of sustainability, property for Colonial First State Global Asset Management thinks the same. “This is an exceptionally important year for energy efficiency, right through the industry,” Griffin says.
The big challenge, according to Toohill, is the issue of split incentives, whereby the owner of the building gets to spend all the capital expenditure on energy improvement measures, and the tenant gets to reap the rewards of lower energy bills.
In shopping centres, where Stockland and Colonial are big investors, this is a major issue since the energy guzzling retail sector consumes about 50 per cent of commercial energy.
“We need something to incentivise the efficiency of our centres,” Toohill says. “We need to find smarter ways to share the burden with the tenants.” She says it could mean changes to state legislation that governs the way capital works’ costs are passed on.
The other big driver this year, Toohill says, is the shift to a broader notion of sustainability to encompass community and social issues. You can tell the industry is ready for this, she says, pointing to the 18 January appointment by GPT of Rosemary Kirkby as head of communities and a similar shift in focus by British peers such as British Land and Hammerson.
Kirkby made big waves in the property industry more than a decade ago when she reworked MLC’s offices in North Sydney to include Australia’s first iteration of the open-plan office, complete with breakout spaces and “Zen den”. The new premises repositioned MLC from staid financial behemoth to employer of choice.
Later she worked with GPT and Lend Lease to deliver the National@Docklands buildings in Melbourne. Essentially Kirkby helped unlock the powerful productive potential of workplaces focused on people (instead of systems or processes) and workplace communities.