ECO Real value of ecological certificate

Thanks to the certificate, one of the aspect will be a distinction of well and bad-constructed buildings, says Jonathan Cohen, the Project Manager Director in Colliers for Europe
Jonathan Cohen
Jonathan Cohen

Is a well-balanced building a certified building?

No. Currently the technical expectation are related to design principles, which according to standards will cause, that modern facilities in Poland are balanced. The certificate is an independent warranty, that building was designed and built according to the rules, set not only by Polish companies, but also by the certificate system

Can we say, that if the building holds LEED or BREEAM certificate, is more attractive?

Certificate is a document which guarantees that the building fulfills certain expectations, and a tenant, holding it, is more comfortable and a warranty and the building adheres to all norms. If certified facility is compared with others, which does not have a certificate, then the question occurs, “Why this building does not have it?” Our experience shows that tenants treat new buildings which do not have a certificate with distance. It does not mean that the facility has to be worse; however, tenant can think, whether the saving on the building was the case here. Other inclinations are: if a developer looks for savings, then the facility can be less technologically advanced, hence less attractive.

It can be set that the certificates will become a standard on the market?

We can equivocally state that they become more popular. I have recently checked on the LEED and BREEAM websites that there are 15 LEED and 31 BREEAM certified facilities in Poland.

But also, there are many buildings, which certification is in progress.

A lot of buildings. It is hard to estimate the number of all buildings which will apply for certification. Some facilities are registered, but there are many which are not certified. We advise to our clients, whether the building should be certified or not. The certification decision is often made, without LEED or BREEAM specification, however.  Therefore the project is not registered.

In this case there are not many buildings which apply for Interim pre-certificates or certificates.

Facility pre-certification or certification makes sense only when the building is being designed or undergoes construction. From building conceptualization and its construction, until the commission of the building, a year or two can lapse. For developer the pre-certification is crucial, due to commercialization process. Such document gives a confirmation to its tenants about high standards of the future building. Of course, it has to be checked whether a particular building was awarded with certification later on. Only the final certificate confirms, that the facility fulfill the requirements. The situation is different when the building already exists. The pre-certification process can last few months, depending on the project advancement. Sometimes it lasts the same amount of times as the final certificate application. Once the building is rented, the developer does not feel the pressure to quickly get a confirmation, that the building is ecological and energy-saving.

Can you tell from your experience whether the clients are able to pay more, for a rent, for example, if the building is certified?

There is very few corporate tenants, who would like to pay more and raise the costs. There are, however, more tenants, who know that there are more savings and other advantages of an ecological building. The costs are lower, mainly thanks to the employees efficiency. The HR role in this context is very crucial. The corporation is able to pay little more to its employees, knowing that it will find the savings elsewhere.

Until 2020, the new buildings will have to significantly decrease the energy usage. Will the developers still certify their facilities?

I am not able to tell how the certification process will look like in 10 years from now. However, all facilities will have to have an energy usage close to zero. Therefore, it will be hard to evaluate the value of the certificate. I think that requirements imposed by LEED or BREEAM will be much higher in 10 years. For sure, the building which will not have a certificate will become less significant.

The investors and developers want to lease their surfaces to the corporate tenants, due to its financial stability. If a tenant has a choice, whether move in to a modern, certified facility, or older – without a certificate, the decision will be obvious. The best tenants will be located in better facilities, the ones which confirm a certain standard. The certificate will indicate which building has good and which has bad standards.

To sum up, more and more professional developers, having experience on the market, will certify their buildings. Modern buildings, which will be certified, will constitute about 50 per cent, perhaps 90 per cent. Rarely, we talk to developers who do not consider certification. Certainly, there are less experienced developers, on the market, for example, businessmen who want to use their asset to build an office building. They often do not understand the value which is given by certificate. Another aspect is a certification low cost. In case of new investment worth 200 million PLN, the cost is lower than 0.5 per cent.

Localization is still very important than certificate.

A good example. We can say that Palace of Culture and Science is in great localization. It has many office spaces, but is it an attractive building for a potential client? The quality is incomparable to a modern facility, where advanced ventilation solutions, air-conditioning and other are installed. Localization is certainly important, however in the city center there are many buildings, that is why the tenant has more options.

This situation is related to Warsaw. What about regional cities? In the center, there are older buildings, whereas the modern buildings are built on the city outskirts.

It can be said, that in regional cities, the office real estate market development is located on the outskirts. For those clients, who are look for the space out of the center, the most important is the functionality and the price. They are not able to spend a lot of money, that is why they do not locate their companies in the center. They need, however, functional spaces, able to allocate more people. It is known, that in the city centers there are small and big companies. In Business Parks, on the outskirts, there a mainly tenants, who rent more than 1 000 sqm. Therefore, they look for open space surfaces. In centers, there are mostly closed offices, with big amount of small spaces.

We can also state, that outside of center, the market is more sensitive to prices and functionality. The companies from PBO and SSC sector have their offices there. First they calculate which of the available facilities will be optimal, and where the costs will be lower.

How is Poland situated to the Middle-Eastern European countries when it comes to the balanced construction industry?

I think, in our region the most active countries are Poland and Russia. The second country is not as mature as Poland. Many developers, who invest in Russia, are not that experienced yet, hence they do not have knowledge, and that is what tenants expect. That is , why, they do not fully know the certification values and its advantages.

Which country do the most experienced developers come from, who value certificates?

Of course from countries where the certification system has been known for several years, that is the USA, Great Britain and in general from Western Europe. It is worth to pay attention to the fact, that lease prices in those particular countries are higher, and the certification process expensive, that is why the investors, who locate their capital there can count on added value. In that region, the value of the certificates was discerned faster. Those markets are much bigger. For example, Munich, which number of population is lower, has 22 million sqm of office surface, while in our capital there are more than 4 million. It is understandable that the competition is higher over there, and thanks to certificates, a given facility becomes more attractive.

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