When Lendlease moves, the market moves. Well, that’s how it used to be when green buildings first kicked off.
And now with the news on Wednesday that the giant developer’s Victoria Cross Tower at North Sydney will be fully electric – and so will all its future buildings – there’s reason to feel optimistic that ambitious leadership is back.
The 42-storey building will be part of the integrated Sydney Metro Station – a $1.2 billion development to be completed in 2024. Key will be to enable the occupants to flag they are using 100 per cent renewable energy.
Bad luck for the chefs who swan into many other corporate boardrooms and demand without compromise they need gas to whip up their delicacies. Something, we hear, that has been causing other developers to weaken their resolve to go all electric and order gas infrastructure to be included into brand new buildings.
This, at a time when even Parisian chefs say induction cooking is an absolutely perfect substitute for producing high end gastronomy.
The gas industry of course will be not pleased. It’s been celebrating the development of hydrogen using to argue we need to keep the gas infrastructure. It says we need to keep the pipes active and deployable because they will soon be filled with “good green” hydrogen. Not a good idea says the experts. Hydrogen molecules are tiny and fugitive from existing pipes, requiring expensive retrofitting.
Hydrogen might be useful for industry but it’s expensive for domestic and other related uses such as commercial kitchens; the cheapest thing is solar energy.
For Lendlease the Victoria Cross Tower is a bold move. In its public statements the company says it forms part of the company’s Mission Zero Roadmap with the big promise: “All Lendlease developments are set to follow the Victoria Cross Tower decarbonisation commitments as essential actions to live up to the promise to be a 1.5 degree aligned company.”
It details in media statements and its website the actions it will take to achieve its sustainability ambitions in Australia – through eliminating gas and diesel from designs and existing assets; switching to 100 per cent renewable electricity; and partnering with suppliers and industry to eliminate embodied carbon in materials such as steel, aluminium and cement.
“As leaders in our space, we take responsibility,” the company says.
“That’s why we’ve made it our mission to reach net zero carbon emissions by 2025 and ABSOLUTE zero by 2040. Our industry’s most aggressive targets. By far. “
To help set the course it’s joined Race To Zero, that it cites as “a United Nations initiative to rally leadership and support from businesses, cities, regions and investors for a healthy, resilient zero carbon recovery. We joined through Business Ambition for 1.5°C. Standing with other global industry leaders, we commit to net-zero value chain emissions by 2050 at the latest. “
The development is 25 per cent owned by APPF Commercial – the fund’s first fully electric building – and be managed by Lendlease Investment Management.
Just the day before the announcement the industry heard company’s global chief executive Tony Lombardo warn that property companies would struggle if they were not focused on greening their portfolios.
He told an AFR property event the level of demand for green buildings was “elevated” and “real”, the newspaper reported.
“If you haven’t gone on to developing sustainable buildings, you’re in trouble…if you haven’t thought about that and gotten your portfolio adjusted to having that level of sustainability and that sort of governance approach, I think you’re not going to be a winner.”
In the sale of 50 per cent stake of the company’s Darling Quarter office complex on Sydney’s Darling Harbour precinct for more than $600 million on a yield below 4 per cent for instance, it was the sustainability rating of the property that had driven investor demand.
He also flagged that the company was building several new buildings in timber, including for Google in Silicon Valley.
JLL Australia and NZ CEO Stephen Conry also told the audience that net zero was “very, very important”: it was expected by tenants.
Industry wide, the whole top end of town has been performing pretty well in recent years in terms of sustainability, achieving top scores on the Global Real Estate Sustainability Benchmark and slashing operational energy.
Now the big game is embodied carbon and the 717 people who registered for our webinar on how to slash embodied carbon in October are testament to the depth of that appetite. Attendees heard what leadership looks like now: how a builder, Built, (and event sponsor) has stepped up bravely with its own leadership goals on this, and how one client Atlassian kicked off the challenge with a mandate for a 50 per cent cut in embodied carbon for its new headquarters at Central.