Westpac will become the first major national corporate tenant to include green lease clauses in its future tenancy agreements, the Better Buildings Partnership has announced. The news follows the release of Westpac’s 2014 sustainability report, which shows the company outperforming on many set targets, including CleanTech and environmental services lending up to $8 billion, well ahead of its $6 billion pledge by 2017.
Best-practice green lease clauses were developed by legal firm Sparke Helmore for the BBP to change the way tenants and landlords approach leases – focusing on cooperation rather than a system of penalties for errant partners, and leading to improved environmental outcomes.
For Westpac, the clauses are expected to encourage environmental initiatives and energy efficiency improvements in head offices.
“Green leases are a really great way to break down barriers between landlords and tenants so they can work together on positive outcomes for a building’s environmental performance,” Westpac Group general manager Bernadette Inglis said.
Green leases, she said, would be implemented when opportunities arose for new lease transactions.
The BBPs green lease clauses are grouped under four categories with Westpac focusing on “cooperation and management” and “specifications and standards”, which include provisions around information sharing, environmental sustainability metering, NABERS and operational performance standards.
Siobhan Toohill, Westpac’s head of group sustainability and community, said the move would benefit both the environment and workers.
“Working with our building owners is a great way to create engaging, eco-efficient environments, reflecting what matters to our people, our customers and the bottom line,” she said.
“A green lease is an effective way to reach these common goals.”
BBP co-chair and group general manager sustainability at Mirvac Paul Edwards said green leases were taking off.
“An increasing number of Better Buildings Partnership members are discussing green leases to ensure that the best management practices and environmental initiatives are in place to benefit everyone,” he said.
“This is a global trend. The 2014 Global Real Estate Sustainability Benchmark survey indicates that 43 per cent of participating Australian building owners are engaging their tenants through green leases. As a result, tenants are continuing to drive emissions and operating costs to the benefit of the bottom line.”
The BBP, established by the City of Sydney, includes more than half the commercial office space in the city centre, and works to reduce water, waste and energy use in member buildings. This work won it Innovator of the Year award at the recent Banksia Awards.
Westpac’s sustainability report showed the company making big gains and outperforming, including $8 billion lent to the CleanTech and the environmental services sector, exceeding its commitment to make available up to $6 billion by 2017.
It also partnered with the World Bank to bring what it says was Australia’s first green bond to the domestic market. The Kangaroo Green Bonds were issued
“in response to requests from large institutional investors looking for a liquid, plain vanilla product that explicitly supports the financing of climate-related projects”.
Energy use and power use effectiveness were improved upon, carbon neutrality was maintained and paper use was reduced significantly.
Recycling rates in the Sydney head office, however, were five per cent off target at 59 per cent. Westpac hopes to recycle 75 per cent of office waste by 2017.
A commitment to make $2 billion available to social and affordable housing by 2017 was progressed, with $820 million now committed.
Women held 44 per cent of leadership positions, with the target of 50 per cent by 2017 on track; mature age worker participation increased; and mean retirement age increased.