Business

‘Green’ offices in London are expensive But they can help retain workers


Employee satisfaction is a big driver for companies to go green, especially as the UK faces its tightest labor market in decades.

Hiroshi Watanabe / Getty

LONDON — One-fifth of the world’s largest companies have committed to net zero carbon emissionsbased on analysis by the Energy and Climate Intelligence Unit, and a large portion of those emissions come from the workplace.

Demand for sustainable offices is high, which means so are prices. In fact, there is now a 26% gap in selling prices between buildings in London that get sustainability ratings from organizations like BREEAM and LEED and those that don’t, according to data from analytics firm MSCI.

That’s called the “green premium.” On the other hand, less eco-friendly buildings, typically older, come with a “brown discount”.

That seems to leave company bosses and investors with a simple choice between lower costs and lower emissions – but the story is much more than that.

Joy Nazzari is a founding director based in London. She’s looking to grow her business, but her old warehouse office building is too small and inaccessible to people with disabilities, so the team’s relocation is “mission critical.” .

“Cost is an incredible barrier,” Nazzari told CNBC, adding that increased office size and better green certification would lead to a “at least 50%” increase in rents over what she saw on the market so far.

“When we were looking at buildings with this brown discount, it was hard not to come across a building like ours, it was a cute old warehouse,” she said.

Eco-Age's Livia Firth on sustainability in the fashion industry

Even finding sustainable space can be a challenge.

“It’s not like you see these green buildings everywhere. They’re rare,” she said, estimating that less than a third of the buildings she’s ever seen will fit the bill.

That scarcity pushes prices even higher. Above all, have corporate branding to think about.

“In the light of the burning planet, this seems irrelevant [but] Your office building is a huge reflection of the brand of your business. A lot of the new buildings are very office and corporate and maybe not somewhere we would normally choose,” she said.

But Nazzari is facing a lot of pressure to move, especially from her own staff.

“Our team is really young and this generation is very alive with the earth they are inheriting… They are extremely aware of the green agenda and they always make that opinion. is the pressure we feel coming from our team,” she said.

Even as costs rise, the majority of companies are willing to invest in green workspaces, according to JLL Global Exploring the future of work 2022. Research shows that 74% of companies surveyed, represented by 1,095 corporate real estate senior decision makers across 13 countries, are “likely to pay high fees for green certification”, with 56% planning to do so by 2025.

great motivation

Read more about energy from CNBC Pro

“We all know we’re in a near-employment environment and really need to build an environment in which their employees are engaging,” said Peter Crowther, Senior vice president of the British Office Council, told CNBC.

“New employees are more curious about the performance from an environmental perspective of the building their employer is in,” he said.

Nearly 80% of organizations surveyed in the JLL report said their employees “will increasingly expect a workplace to have a positive impact on the environment” while 75% say the same about the positive impact. extreme to society.

According to the CEO of Edge, a sustainable real estate developer, the move to hybrid means every day, employees are thinking about whether or not going to the office is worth it.

“We’ve seen a lot of examples of offices that are so low-quality that people don’t want to go into the office anymore,” said Coen van Oostrom.

“What’s really expensive is if you have a large office building that’s used one or two days a week. That’s a huge amount of rent that you pay for limited meeting time,” van Oostrom said.

Tighter financial conditions

Europe's real energy crisis is coming next winter - but it won't last forever, either

Sustainability may be put on hold as finances tighten, says Crowther of the BCO, but it is becoming a priority as the climate emergency grows.

“There’s little willingness to see sustainability drop off the list of needs because I think people are becoming more and more climate aware that this is not something that’s going to go away. It’s not It’s something we can pick up or put down depending on what’s happening in the economy,” Crowther said.

Business owner Nazzari agrees, even if it means she could face a huge increase in costs.

Nazzari said: “Are we all just focusing on the essentials? That’s a real risk to the green agenda. We all have an obligation to make sure we’re upholding and improve its carbon efficiency through all of this”.

news7g

News7g: Update the world's latest breaking news online of the day, breaking news, politics, society today, international mainstream news .Updated news 24/7: Entertainment, Sports...at the World everyday world. Hot news, images, video clips that are updated quickly and reliably

Related Articles

Back to top button