Aug 31, 2012
Green-rated buildings ‘don’t cost an arm and a leg’Back
Construction|Africa|Sustainable|Water|Africa|Australia|South Africa|United States|Star Green Star Building|Building|Energy|Green Building|Green Building Materials|Green-building|Product|Environmental|Brian Wilkinson|Nicola Milne|Water
© Reuse this
There is no significant difference between construction costs for green buildings and those of conventional buildings, and green buildings achieve better investment returns and higher valuations, says industry body Green Building Council of South Africa (GBCSA) CEO Brian Wilkinson.
The majority of reported premiums for green buildings in the US are between 0% and 4% higher than conventional buildings. However, the latest studies in Australia show that a 4-Star Green Star building is actually cheaper to build on average, while a 6-Star Green Star building – signifying world leadership – usually has a relatively small premium of about 6%.
The comparative immaturity of the South African green building market means there have not yet been any broad empirical studies on the capital cost impacts of green building locally. However, the local case studies documented in the green building ‘Rands and Sense’ report show the South African property industry can expect cost premiums of a new commercial green building to be between 1% and 10%, he says.
In young green building markets like South Africa, sustainable buildings generally incur a green premium above the cost of standard construction. However, once these markets mature and green building materials and practices become more prevalent, these “new market premiums” decrease and green building can be done at similar costs to conventional buildings, he says.
“While there seems to be consensus on the environmental benefits of green buildings, there is a lack of accurate, thorough financial and economic supporting information,” explains ‘Rands and Sense’ report author Nicola Milne.
The report highlights the financial and environmental benefits of green building, such as lower operating costs owing to savings on energy and water in particular, higher returns on assets and increased property values based on the lower operating costs.
Green buildings are also viewed as less risky, future-proofed buildings, which can fetch lease premiums and retain tenants longer than conventional buildings. Other benefits include the enhanced marketability of a green building, as it is a technologically advanced, environmentally and socially responsible building representing a differentiated product in the market, she says.
Green buildings also represent responsible investing, and reduced liability and risk because developers are cognisant of, and guard against increasing utility costs and supply constraints, as well as being mindful of possible carbon taxes and potential mandatory energy performance disclosure and broader regulation, says Milne.
Edited by: Martin Zhuwakinyu© Reuse this Comment Guidelines (150 word limit)
Other Environment News
International consulting engineering company Royal HaskoningDHV (RHDHV) has appointed Salani Sithole as South African MD, effective March 1. Sithole has been with the company for six years and, prior to joining RHDHV, held various positions in engineering consulting,...
Recent Research Reports
Construction 2015: A review of South Africa’s construction sector (PDF Report)
Creamer Media’s Construction 2015 Report examines South Africa’s construction industry over the past 12 months. The report provides insight into the business environment; the key participants in the sector; local construction demand; geographic diversification;...
Liquid Fuels 2014 - A review of South Africa's Liquid Fuels sector (PDF Report)
Creamer Media’s Liquid Fuels 2014 Report examines these issues, focusing on the business environment, oil and gas exploration, the country’s feedstock supplies, the development of South Africa’s biofuels industry, fuel pricing, competition in the sector, the...
Water 2014: A review of South Africa's water sector (PDF Report)
Creamer Media’s Water 2014 report considers the aforementioned issues, not only in the South African context, but also in the African and global context, and examines the issues of water and sanitation, water quality and the demand for water, among others.
Defence 2014: A review of South Africa's defence industry (PDF Report)
Creamer Media’s Defence 2014 report examines South Africa’s defence industry, with particular focus on the key participants in the sector, the innovations that have come out of the sector, local and export demand, South Africa’s controversial multibillion-rand...
Road and Rail 2014: A review of South Africa's road and rail infrastructure (PDF report)
Creamer Media’s Road and Rail 2014 report examines South Africa’s road and rail transport system, with particular focus on the size and state of the country’s road and rail network, the funding and maintenance of these respective networks, and the push to move road...
Real Economy Year Book 2014 (PDF Report)
This edition drills down into the performance and outlook for a variety of sectors, including automotive, construction, electricity, transport, steel, water, coal, gold, iron-ore and platinum.
This Week's Magazine
National flag carrier South African Airways (SAA) is in an advanced stage of renegotiating its deal with European airliner manufacturer Airbus to acquire A320 single-aisle (or narrow body) aircraft. The aim is to replace ten of the aircraft still on order with five...
Worldwide, the main thrust in the ports industry over the past decade or more has been to increase efficiency. Traditionally, ports have been run by engineers and mariners and, in the past, increasing a port’s capacity was achieved by expanding the harbour. “That has...
What do you do when an elephant has a toothache? You call Dr Gerhard Steenkamp from the University of Pretoria’s (UP’s) faculty of veterinary science, Onderstepoort, one of only two elephant ‘dentists’ in the world.
The 2015 Sanlam/Business Partners Entrepreneur of the Year (EOY) competition was launched earlier this month in Johannesburg, with the main focus on creating and inspiring entrepreneurs to create jobs and boost the economy.
In a recent letter to the editor that I sent to Engineering News (Concerns regarding South African portion of Square Kilometre Array) and in a follow-up article elaborating further (We must start preparations to build our own synchrotron light source), I stated my...