Competition in the Metro Manila office property market is driving the development of green office buildings, real estate analyst KMC Savills Inc. said.
In a phone interview, KMC Savills Inc. Vice President for Marketing and Landlord Services Yves Luethi told The Manila Times that that there is an increasing interest from tenants to locate in green office buildings, which is creating competition among developers.
“Of course it is more competitive. Landlords have to differentiate themselves with higher quality buildings,” Luethi said.
Luethi noted that growing interest for green developments is mainly due to the cost-cutting features that green office buildings offer.
“The main benefit there is to the tenants, because they can actually have a lower operating costs,” Luethi said.
He added, “Operational monthly cost savings for tenants can be up to 78 percent compared with an old Grade B building and 20 percent compared with a conventional Grade A building.”
Luethi explained that putting up a green office building will result in additional costs on the development side, but will result in higher property values in the future.
“Yes, it costs more, but developers have to look at the long-term value of the property,” Luethi said.
Aside from cost-cutting features, green buildings also promote the well-being of employees, which could lead to higher productivity, according to Leechiu Property Consultants (LPC) chief executive officer David Leechiu.
“Not only do green buildings help the environment recover, but they also present businesses and tenants with economic benefits that make for an excellent investment,” Leechiu said in an earlier statement.
Leechiu cited separate studies from the US Environmental Protection Agency and the World Green Building Council, who noted that green spaces improve employee productivity. This is mainly due to better indoor air quality and ventilation, thermal comfort, and noise reduction, all of which is attributed to green design elements.
Luethi noted, however, that despite the growing interest for green office developments, the trend so far is something that is considered more of an additional feature rather than mandatory elements of a building.
“At this point, to most prospective tenants it’s not required but nice to have,” Luethi observed.