Sustainable Property: A Premium Product?
||Sayce, Sarah; Sundberg , Anna; Cowling, Edward
||Sustainable Property: A Premium Product?
||16th Annual European Real Estate Society Conference in Stockholm, Sweden
||The call to establish a business case for the development of ‘green’ or/and sustainable commercial properties has been prompted by knowledge and increasing concern of the environmental and social impact of buildings. Initially proponents sought to root the business case to added benefit and reduced revenue costs to the occupier (see for example, Edwards, 1999; Kats, 2003). It was only in 2000 (Sustainable Construction Task Group, 2000) that the agenda began to shift towards notions of reward. Since then, realization has grown that any business case must be founded on added value (Ellison et al, 2007). Therefore the debate has moved from supply to demand and with this have come claims that sustainable buildings may be ‘worth more’ either theoretically (Lutzkendorf and Lorenz,2005; Ellison and Sayce, 2006) or on the basis of investor or tenant intention (McMahon, 2008; Merrill Lynch, 2005). Other claim premium values in practice (RICS, 2005; Green Building Council of Australia, 2006; Miller et al; 2008). This paper will present findings from an RICS commissioned research project reviewing the international literature in order to establish the validity of claims of premium value. In analyzing the literature, the evidence has been framed such that it is possible to isolate any sub_sectors or locations in which robust data, free from the noise of other market drivers. In so doing the authors reviewed perception studies, theoretical work and empirical surveys and case studies. The analysis was undertaken using both qualitative interpretation and statistical techniques. By so doing, the authors have been able to isolate trends which enable tentative conclusions to be reached as to the ‘direction of travel’ in the market place. The paper concludes by setting out an agenda for both further research and recommendations for actions by property investors and professional bodies.
||Sustainable Property; Value; Risk
||firstname.lastname@example.org, email@example.com, firstname.lastname@example.org
||file.ppt (519,168 bytes)
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