1 / 19

Commercial Property – Shape the Debate: Have your say on engagement, value and risk

Commercial Property – Shape the Debate: Have your say on engagement, value and risk. Chair: Keith Bugden, Programme Director, BBP Paul Edwards, Head of Sustainability, Hammerson Miles Keeping, Partner and Head of Responsible Property Investment, Drivers Jonas Deloitte Stuart Bowman, CoreNet

jude
Download Presentation

Commercial Property – Shape the Debate: Have your say on engagement, value and risk

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Bartholomew Room

  2. Commercial Property – Shape the Debate: Have your say on engagement, value and risk • Chair: Keith Bugden, Programme Director, BBP • Paul Edwards, Head of Sustainability, Hammerson • Miles Keeping, Partner and Head of Responsible Property Investment, Drivers Jonas Deloitte • Stuart Bowman, CoreNet • Matthew Tippett, Upstream Sustainability Services, Jones Lang Lasalle Bartholomew Room

  3. Commercial Property – Shape the Debate: Have your say…..

  4. Paul EdwardsHead of Sustainability OWNER OCCUPIER ENGAGEMENT

  5. Key issues…. • Sharing information is the key to success • Owners and occupiers have the same challenges and opportunities • Best results can be achieved through partnership and collaboration

  6. Questions….. • Who is most responsible for taking the lead in engagement? Owner or Occupier? • Owner • Occupier • Do you think regulation over the past 5 years has helped in any way to improve owner / occupier relations? • Yes • No

  7. Miles Keeping CEnvMRICSFRSAPartner, Sustainability GREEN VALUE

  8. Key issues…. One main issue & two key issues • The main issue we really do need to get over: • Value premium or value discount? • Other issues: • What are the key drivers of value? • We all need to be more sophisticated in our analysis!

  9. Premium or Discount: ‘Re-phrasing’ the Evidence Rental Value divergence between energy efficient and non-energy efficient offices – The Netherlands Source: The Value of Energy Labels in the European Office Market – Nils Kok & Maarten Jennen – May 2011 9

  10. Premium or Discount: ‘Re-phrasing’ the Evidence Rental Value divergence between energy efficient and non-energy efficient offices – The Netherlands Source: The Value of Energy Labels in the European Office Market – Nils Kok & Maarten Jennen – May 2011 Correlation between Energy Efficiency and Rental Indices “Generally” Positive “Generally” Negative

  11. Drivers of value: Some scenario implications Source: IIGCC (2010)

  12. Sophisticated analysis: Understanding the threats to valueLikelihood of occupiers acting on their policies Strength of carbon reduction policy amongst different business types (based on sample of £1.5bn of tenant-occupied real estate assets) Proportion of rental income (%) Source: SIAM LLP Sector No Policy Policy With targets Source: Deloitte LLP

  13. Conclusion • Increasingly compelling evidence available supporting value shift as a result of energy efficiency/wider sustainability factors • Riskthat trend is interpreted as delivering ‘Premium’ or ‘Added’ Value… of greater concern is depreciation and obsolescence • Impact on property and portfolio performance will be property specific – and not based solely on sustainability credentials • Impact of tenant demand will be interesting & important to monitor • Strategy should focus on immediacy, likelihood and scale of impact together with ability to mitigate and harness upside.

  14. Questions….. • Do you believe there is a link between sustainability performance and value? • Yes • No • What do you think will be the biggest driver linking sustainability to value? • Obsolescence • Tenant retention • Increasing Regulation • Rental value • Building Ratings (EPCs, DECs etc)

  15. Stuart Bowman CEng MEIDirector of Breathe Energy LtdKnowledge & Learning Group Leader CoreNet UK CLIMATE CHANGE RISK

  16. Key issues…. • Tangible climate change risks • How big are these risks? • How important are these risks?

  17. Questions….. • What do you consider the biggest climate change risk? • Buildings no longer fit for purpose • Escalation of operational costs • Insurance availability • Disruptions to supply chain • None are of significance • How important, relative to other business issues, is the management of climate change risk? • High • Medium • Low • Not on our radar

  18. Bartholomew Room

  19. Commercial Property – Shape the Debate: Have your say on engagement, value and risk Matthew Tippett, Upstream Sustainability Services, Jones Lang Lasalle Bartholomew Room

More Related