Paying more rent in a green building: 5 Reasons why its worth it
A building with a certified green rating often comes at a higher monthly rental compared to the alternatives – here are five good reasons why John McMahon believes they are worth paying extra for:
1. Slash your utility overheads
The first obvious benefit is a considerable saving on utilities. A case in point is Cape Town’s tallest (and South Africa’s greenest) new building, Portside, which incorporates a host of innovative green technologies. The building captures rain water which, given Cape Town’s cold and wet winters, will reduce overall water consumption. Energy efficient lighting and air conditioning reduces electricity bills by up to 30%. This significant saving in electricity allows the generator to run for up to two days (without air conditioning, but with fresh air circulation) in the event of a power cut. We hope that load shedding won’t get to that point.
2. Green buildings require less maintenance
Most green buildings incorporate sustainable features that are designed to last longer. Therefore, the need for regular (and costly) maintenance jobs such exterior painting are decreased.
3. Opportunity to build fantastic brand equity
Many South African companies and premium brands in particular now associate an environmentally conscious perception with their brand’s positioning. Woolworths SA is a star example, where first class standards in sustainability, conservation and waste management has become an important expectation from their customers. With regards to commercial property, the company has built their entire Midrand-based distribution center around a wetland which conserves the natural ecosystem of endangered species of African bull frog. They even planted grass on the roof. Combined, these efforts add considerable value to the company’s brand equity traditionally not factored into the additional costs of going green.
4. Tax benefits
Government introduced the 12L Energy Efficient Tax Allowance in November 2013. In a nutshell, the allowed deduction is calculated at 45c/kWh for verified energy efficiency savings, not restricted to any industry. Therefore, Tenants benefit from green buildings already certified by SANEDI enabling them to apply for this tax allowance from SARS.
5. Increased workplace productivity
A study conducted by Jones Lang LaSalle in Australia and research by Angela Howard from IBE, suggests that a combination of clean air, thermal comfort and high amounts of natural light balanced by anti-glare windows and access to outside views contributes to enhanced productivity. Using the Portside building as an example again, each section of the building is optimized for all of these factors given the position of the sun at any given time. To find out more about office space to let in Cape Town's Portside building, click here
Author: John McMahon