Green Leases on the rise in South Africa

A green lease, explains GBCSA executive chairperson Bruce Kerswill, lays out certain contractual lease obligations between a landlord and a tenant of a building, that require or encourage the adoption of environmentally friendly practices.

To this end, a working group of members from the GBCSA and Sapoa has been established to jointly develop a guide to green leasing.

“Although green leases are becoming the norm in countries such as Australia and the United States, they are a relatively new concept in South Africa. The GBCSA is working with Sapoa to develop a guide to green leasing with recommendations and guidelines that will allow owners and occupiers of buildings to establish green leases,” Kerswill adds.

“Green buildings offering green leases will ultimately attract and retain tenants for longer and at optimal rentals. Additionally, green leases can ensure that tenants and landlords both benefit from the cumulative reduction in operating expenses of a green building. Accordingly, green leases are generally collaborative, with both parties committing to certain obligations,” says Kerswill.

Kerswill says increasing interest in green buildings is encouraging developers to build Green Star SA-rated buildings, which improve building performance. Green leases are a way of measuring this performance and dealing with cost issues. “A green lease ensures a building that is designed to be sustainable is operated in a sustainable way,” continues Kerswill

“The GBCSA recognised the need for a new approach to leasing in 2009 and introduced the ‘green lease’ credit in the Green Star SA – Retail Centre tool, which facilitates the rating of new green retail spaces. The credit incentives and rewards property owners that draw up a green lease with their tenants.”

Green buildings reduce the consumption of energy and other resources, which is becoming increasingly important as these costs continue to escalate. A tenant can use a green lease to ensure the space occupied meets these requirements.

From the landlord’s side, if tenants do not buy in to the concept of a green building, their behaviour can defeat the purpose of the building – especially in areas like energy usage and recycling schemes – and benefits will not be realised.

Because of the health, well-being and productivity benefits associated with green buildings, green leases are also seen as a way of attracting tenants, since about 80% of a person’s waking time is spent at work in the office. Thus corporations view green buildings as a way of attracting high-level staff.

Kerswill explains that some examples of a landlord's obligations as contained in a green lease may be: to meter the energy and water consumption of each tenant separately; to provide certified evidence that all building elements and systems are installed and operated with maximum efficiency; to prohibit the use of CFCs in air conditioning systems; to ensure dedicated recycling facilities are easily accessible; to monitor and adjust air conditioning levels to reduce energy use and to provide appropriate numbers of bicycle storage and changing rooms.

Examples of a tenant's obligations might include: monitoring good levels of indoor air quality and ventilation efficiency; ensuring their offices fit-out avoids the use of toxic materials, uses recycled materials and energy efficient office equipment and that they recycle in accordance with the buildings waste management and recycling policy.

Other examples may be for landlords and tenants to mutually establish an environmental friendly purchasing policy covering ongoing consumables, such as paper, office supplies, printer cartridges and other low-cost items that are regularly used and replaced through the course of business.

The structure of a green lease motivates all stakeholders to invest, operate and work in a building in an environmentally and socially responsible manner. Would you consider green leasing whether you are a tenant or property owner?

  Comment on this Article

  Please login to post comments

Post to my facebook wall
Characters remaining

    Latest Property News
    • 19 Feb 2018
      Possibly one of the biggest sources of contention between landlords and tenants surrounds the rental deposit. “Most tenants rely on getting their rental deposits back when moving, so that they can use it to pay a deposit on their new home. Having it withheld or even having large amounts deducted can lead to a lot of distress,” explains Bruce Swain, CEO of Leapfrog Property Group.
    • 19 Feb 2018
      Situated approximately halfway between Johannesburg and Pretoria, Midrand was established in 1981 and forms part of the City of Johannesburg Metropolitan Municipality. It has become one of the major business hubs in the country with major pharmaceutical, textile, telecommunication and motoring giants situated within its boundaries.
    • 19 Feb 2018
      The PayProp Rental Index Annual Review of 2017 shows that the rental market suffered from much volatility during the year. It kicked off with rental growth spiking in January with weighted year-on-year growth (YoY) growth peaking at 8.3% before dropping to 6.34% in July, dipping down to less than 5% in November and then experiencing a slight uptick at 5.75% in December.
    • 19 Feb 2018
      While most homes in cluster complexes, estates and other gated communities come with at least one garage or carport, residents would often like additional permanent parking or storage areas for things like trailers, bikes, boats and caravans.
    • 16 Feb 2018
      Whether you own a property in a sectional title complex or are looking to invest in one, the financial standing of the body corporate is the single most important thing that can affect your investment or your buying decision.
    • 15 Feb 2018
      One positive consequence of the financial crash in 2008 was the rise in consumerism, especially in the property market, where buyers have steadily become more knowledgeable and more value conscious.
    • 15 Feb 2018
      While most homeowners will take the agent’s commission into consideration when they are trying to determine what the will get out from the sale of their property, many often forget to factor in the other costs involved in a home sale, says Adrian Goslett, Regional Director and CEO of RE/MAX of Southern Africa.
    • 14 Feb 2018
      The forecast for the national rental market in 2018 remains a mixed bag of good news and bad news. Although rentals are expected to rise slowly as the challenges of home affordability and tighter lending criteria tighten their grip, it’s a double-edged sword as the market also will come under increasing pressure from factors like declining disposable income levels.
    Subscribe to the MyProperty Newsletter

    Last Name  
    Email Address  
    Email Frequency
    Share this Page

    For Sale Property
    Rental Property
    More Options
    Connect with us