Sustainability Accreditation the Commercial Norm Across Region
Accreditation for commercial real estate developments from an independent, third-party sustainability organization is now very much the norm for development in the Central European office markets and increasingly in other sectors such as logistics and retail.
Established regional developers such as, Atenor, CA Immo, CPI, GTC, HB Reavis, Horizon Development, Immofinanz, Skanska and Wing have common sustainable development policies across Hungary, Central Europe and Western Europe.
This could be seen as market pressures exerting influence on developers and building-owners to meet the demands of stakeholders such as tenants, staff and investors, but at the same time it shows their commitment to conform to sustainability regulations and expectations of governments, environmental pressure groups and other institutions.
This brings into play issues regarding the planning, construction and management of buildings and their immediate surroundings and interconnectivity with the wider urban environment applied at the planning, construction, management and exit/sales phases.
The major certifying bodies are the U.K.-based BREEAM (Building Research Establishment Environmental Assessment Method) and the U.S.-based LEED (Leadership in Energy and Environmental Design) and, increasingly, WELL, which focusses more on the inhabitants of the building, rather than the structure itself.
“The certification systems help to highlight the importance of systematic thinking during the design, construction and operation of the buildings,” comments Zsombor Barta, a sustainability expert and president of the Hungarian Green Building Council (HuGBC).
“The importance of sustainability features and issues have become at least a ‘must have’ on the commercial real estate market, therefore there is definitely a beneficial shift in the Central European area, especially after the political changes and the ‘old fashioned’ construction practices. In terms of efficiency, it is always the question which and what level of sustainability is implemented. The certifications can provide a beneficial framework, but it has to be utilized accordingly to receive real benefits and efficiency,” he adds.
The Hungarian developer and investor Wing has achieved BREEAM Excellent accreditation for the built-to-suit Magyar Telekom headquarters, designed by TIBA Architect Studio. The 58,000 sqm complex includes two restaurants, an internal garden, roof top fitness club and running track.
“Wing’s mission is to partner with Hungary’s leading corporations to deliver long-term and environmentally conscious solutions to address their international property needs,” says Noah Steinberg, chairman and CEO of the developer.
“We are committed to creating sustainable buildings that go beyond today’s requirements, help save the environment and feature people-oriented services for increased employee comfort, as demonstrated by the BREEAM ‘Excellent’ rating we have just received for the Telekom headquarters, and by the rating we are targeting for the Liberty Office Building,” he adds.
Logistics developers are creating increasingly complicated industrial complexes in reaction to developing tenant requirements such as automized warehouses and a growing concern with the working environment and the comfort of staff.
Other factors in play include tenants looking to save on utility costs, and developers needing to comply with international environmental regulations. Thus the major industrial park developers and operators are also seeking third-party sustainability accreditation.
Prologis has achieved BREEAM sustainability accreditation for six logistics facilities in Hungary as part of its CEE green development policy. Prologis is developing a 10,600 sqm speculative facility at Prologis Harbor Park that will be submitted for BREEAM “Very Good” accreditation.
The developer says sustainable features will include high grade insulated wall panels and roof systems that, together with high performance gas-fired heaters, can cut heating costs by 30%. Further, energy efficient LED lighting and large skylights reduce electricity costs by 40% compared to the latest lighting standard. Smart metering will also optimize water, gas and electricity consumption in the complex.
Elsewhere in its portfolio, Prologis has been awarded BREEAM “Outstanding”, the highest BREEAM level, for the 37,000 sqm Building 3 at Prologis Park Prague-Airport.
“The majority of investors are indeed requesting sustainability third-party certifications. This is also understandable as the risk mitigation and future-proofing developments are not only economically beneficial but also important for the different other stakeholders of the sector (tenants, building users, insurance companies, etc.),” explains HuGBC’s Barta.
Green accreditation is equally an expected norm in investment deals at the higher end of the market. Skanska, for example, has sold the 14,000 sqm Nordic Light Trio office building to JR AMC, a South Korean real estate investment trust.
The area around the Nordic Light complex will offer 2,400 sqm of landscaped multi-activity gardens open to tenants and neighboring communities, bicycle storage facilities with changing rooms and showers, as well as parking with charging stations adapted for electric vehicles.
The complex was designed by Paulinyi-Reith & Partners and could be the first WELL-certified Skanska building in Hungary in addition to its LEED “Gold” certifications. In another high end deal, the German closed-end Warburg-HIH RE fund has purchased the LEED “Platinum” certified White House from GTC.
“Green building certifications have become the norm in high quality commercial real estate developments. However, it is still not the norm in the public building sector and in sport facilities developments,” Barta points out.
“As president of the HuGBC, I would like to actively work with stakeholders in the public building sector to establish sustainability features and third-party certifications within the that sector. According to our opinion, it would be highly important for the public sector to showcase sustainability and even more important to spend the taxpayers’ money on future-proofed and sustainable developments only. This would have a beneficial effect on the social level,” Zsombor concludes.
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