Green light for business in the suburbs
While Green Star-rated buildings in downtown city areas tend to hog the limelight, figures from the Green Building Council of Australia show more than half of the sustainable offices built since the ratings were introduced in 2004 are outside Australia's city centres.
Over the past nine years, 225 Green Star-designed or as-built offices were constructed in CBD locations, compared with 135 buildings in the suburbs, GBCA figures show. When Green Star office interior fitouts are also included, the total figures rise to 311 and 164 respectively.
Tenant demand, energy costs and the need to future proof assets meant green star ratings in the commercial office sector were now almost "business as usual", chief operating officer Robin Mellon said.
Developer Pellicano is midway through constructing a 4000- square-metre speculative office development in its Parkview Estate in Warrigal Road that will target a five-star National Australian Built Environment Rating System (NABERS) rating.
"As a long-term property owner, we saw it as good investment," director Nando Pellicano said.
He said building to that standard typically added up to 7 per cent in costs.
Corporate and government tenants were driving demand but smaller tenants were usually unwilling to pay additional rent to be in a five-star building, he said.
Colliers International's recent office tenant survey found green office space was among the top four attributes sought by staff, alongside bike racks, childcare and a gym.
Six weeks ago, Schneider Electric Australia consolidated 380 employees from nine different offices into a yet-to-be-accredited five-star Green Star building in Goodman's Ferntree Business Park in Notting Hill. The office showcases the company's energy management systems and includes lighting, energy and water monitoring, as well as extensive sun shading, light and water harvesting and chilled beam airconditioning.
Another 5500-square-metre building in the same business park achieved a four-star Green Star rating and was targeting a five-star NABERS approval.
Green Star-certified buildings produce 62 per cent fewer greenhouse gas emissions and use 66 per cent less electricity than average buildings, Mr Mellon said.
Salta's Nexus Corporate business park in Melbourne's south-east has also focused on lifting building standards in the suburbs. The 7.1-hectare estate has been developed with minimum 4.5-star NABERS ratings and four-star Green Star rating for each building. Two buildings on the estate occupied by IMA, a subsidiary of insurer IAG, and payroll services firm ADP had achieved five-star Green Star ratings, according to Salta.
Two other suburban projects - Orica's corporate headquarters in Clayton and the BAE offices in the Victoria Gardens precinct - were also 4.5-star Green Star-rated buildings.
sjohanson@fairfaxmedia.com.au
Frequently Asked Questions about this Article…
Corporate and government tenants, rising energy costs and the need to future-proof assets are the main drivers, according to industry commentary in the article. Tenant demand is encouraging developers and owners to target Green Star and NABERS ratings for suburban office space.
More than half of Green Star-designed or as-built sustainable offices built since the ratings began in 2004 are outside city centres. GBCA figures cited 225 Green Star offices in CBD locations versus 135 in the suburbs, and when fitouts are included the totals were 311 (CBD) and 164 (suburbs).
Green Star and NABERS are Australian sustainability ratings for buildings. The article notes Green Star-certified buildings produce 62% fewer greenhouse gas emissions and use 66% less electricity than average buildings, making them more energy-efficient and attractive to tenants—factors investors consider when assessing long-term asset value.
Developers in the article said targeting high sustainability standards typically adds about 7% to construction costs. Corporate and government tenants are driving demand and more likely to accept premium space, but smaller tenants are often unwilling to pay additional rent for five-star-rated buildings.
Examples in the article include Pellicano (constructing a 4,000 sqm office targeting a five-star NABERS rating), Schneider Electric Australia (consolidated 380 staff into a five-star Green Star office in Goodman's Ferntree Business Park), Salta’s Nexus Corporate estate (minimum 4.5-star NABERS and four-star Green Star, with some buildings achieving five-star Green Star), plus suburban projects by Orica and BAE that have 4.5-star Green Star ratings.
The article describes features such as integrated energy management systems, lighting and water monitoring, extensive sun shading, light and water harvesting and chilled-beam air conditioning—elements highlighted in Schneider Electric’s five-star Green Star office.
A Colliers International tenant survey cited in the article found green office space ranks among the top four attributes sought by staff, alongside bike racks, childcare and a gym—showing sustainability can be a key factor in attracting and retaining employees.
Investors should consider tenant demand (especially from corporate and government tenants), potential energy cost savings and emissions reduction from certified buildings, the modest construction premium reported (around 7%), and targeted ratings such as Green Star and NABERS that can help future-proof assets and improve marketability.
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