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KUALA LUMPUR: Corporate Real Estate (CRE) executives in Asia Pacific are more willing than their global counterparts to invest in sustainability, according to a global sustainability survey undertaken in September and October 2008 by Jones Lang LaSalle and CoreNet Global.
Asia Pacific head of energy and sustainability services at Jones Lang LaSalle, Chris Wallbank said Asia Pacific respondents showed a greater willingness to invest in sustainable solutions than the global average.
Presenting the second global sustainability survey at the CoreNet Global Summit in Macau, which was held on March 24 - 26, he said 60% of respondents in Asia Pacific were willing to pay a 10% premium to rent a sustainable or "green” building, up from the 55% recorded in 2007.
The survey covers 400 CRE executives across the globe.
“Though only 6%, compared with 12% in 2007, would consider paying more than a 10% premium, this is still double the global average of 3%,” said Wallbank
“The willingness to pay more in Asia Pacific may be partly attributed to the perception that sustainable solutions are difficult to find in markets that are less 'mature',” he said, adding that sustainability as a major influence in CRE strategies and decisions in Asia Pacific.
He noted a 20% increase among respondents in Asia Pacific (68%) and globally (64%) who cited limited to no availability of sustainable solutions in the market for which they operate.
Wallbank added while more than 40% of respondents globally are willing to pay the rental premium for a sustainable building, this is a drastic drop from the 70% recorded in 2007. The survey also shows a decrease in the number of companies willing to pay more for green buildings today than a year ago.
“This is surprising given that three quarters of them consider sustainability a “major” or “tie-breaker” factor in location decisions and more of them see a scarcity of green space today.
“Certainly, they are under greater cost pressures this year, which may account for their reluctance to pay a premium,” says Wallbank.
Despite the current economic climate, the survey also shows that CRE executives have not deterred pursuing sustainability strategies ies as the focus on green buildings continues to increase.
“Today, 76% of the companies surveyed believe that sustainability is a critical business issue, up from 47% in 2007, and those who aren’t focused on it today expect that they will be soon,” added Wallbank.
In addition, 57% of respondents reported broad implementation of energy efficiency programmes as the strategy with the greatest financial payback.
In fact, 73% of CRE executives cited energy costs as an important metric, surpassed only by the 82% who consider green building ratings and certifications a key factor in making space decisions.
Still, many are frustrated at the lack of verifiable data: “Tangible results with accurate data from initiatives still remain at the infancy stage,” says one respondent.
In tough economic times, Wallbank reckoned energy efficiency initiatives would be increasingly important to deliver bottom-lie returns.
“The CRE teams are increasingly aware that energy strategies can drive significant cost reductions, and that many other sustainability initiatives can further incorporate environmental goals without disrupting financial priorities," he said.
