GBCSA says cost saving payback is between three to five years. 95% of office buildings don’t comply.
Despite South Africa being the fastest growing green building market in the world, most buildings in the office sector do not comply with environmental sustainability standards. But there is a strong case for green retrofitting.
While South Africa is only playing catch-up to its developed and developing counters, United States-based McGraw-Hill Construction in its World Green Building Trends survey notes that 58% of South African firms surveyed reported future green commercial retrofits by 2015.
Furthermore the survey, which tracks 62 countries pegs the country’s take up of green building to grow three-fold, from a measured 16% in 2012 to 52% by 2015.
These figures put South Africa ahead of the pack for its fast adoption of green building – trumping Australia, United Arab Emirates, Singapore and Brazil – despite its foray into green building seven years ago.
“The uptake of the green movement in South Africa has been exponential [and] there is a deep understanding of the benefits of green building,” Groves told Moneyweb.
The number of new buildings constructed in South Africa is relatively small in terms of the existing building stock, says Dr Rodney Milford, programme manager for the Construction Industry Development Board.
“Electricity consumption and greenhouse gas emissions arising from the existing building stock will far exceed that from the buildings constructed over the next 20 years or so,” says Milford.
Associate and sustainability consultant at WSP Africa Alison Groves says about 95% of existing buildings in South Africa do not comply with energy and environmental sustainability standards.
“Energy efficiency and retrofitting of the existing building stock must therefore be a priority focus into the future,” Milford says.
Another driver of retrofitting initiatives is tenant demand. Groves says tenants in non-green buildings are demanding green space to demonstrate their commitment to sustainability and to accrue the benefits that green spaces offer.
Converting a traditional building riddled with greenhouse gas emissions into a green building is no mean feat.
Retrofitting is often associated with high costs and McGraw-Hill Construction’s survey supports this view. It notes that 86% of South African firms cited concerns of higher costs of retrofitting.
Groves says retrofitting costs all depend on the scale of green initiatives in a building, as there are minor and major retrofits.
“Quite frequently companies don’t have the money to do the major retrofits, but there are things they can do within reach,” she says.
Some of the most common minor retrofits are replacing conventional light systems with energy efficient lighting. Retrofitting could also ascend to more costly and holistic initiatives such as reviewing air conditioning, investing in rain harvesting technology, waste disposal and solar panel heating.
“If you think about an office environment, it’s a constant energy demand and if you can drop that by half, that makes a difference to your total [energy and water] bill…If you do your sums, you will work out the payback period and then you can see whether or not it is something you can live with,” Groves adds.
Managing director of the Concrete Institute, Bryan Perrie agrees with Groves, saying retrofit costs must be viewed in relation to the life cycle of a building – as such green initiatives are likely to save money in the long run.
The Green Building Council of South Africa (GBCSA) puts the standard payback period of cost savings after retrofits at between three to five years. Some of the benefits include lower operating costs – particularly savings in energy and water usage by up to 50%, increase in property value of up to 12% (based on US and Australia case studies), higher rental rates and attracting tenants.
“Our green buildings are showing signs of enhanced returns and better fundamentals. The challenge for our industry lies in future proofing the existing stock through sustainable and greening initiatives,” Investment Property Databank (IPD) executive director Stan Garrun explains.
According to GBCSA programme manager Jo Anderson, there are 34 buildings rated in the four green star category, 13 in five star and three as six star. Though the rating favors new green buildings, retrofits of existing buildings also make the cut.
Cape Town’s mixed-use development, the Victoria & Alfred (V&A) Waterfront, embarked on a retrofit project to the tune of R22 million. The project involved changing light fittings, installing air conditioner control measures, waste management and less water use on its irrigation system. Over a three-year period, the V&A Waterfront recorded a consumption saving of R15.5 million.
In Johannesburg, the The FirstRand group undertook a major retrofit of its businesses in 2008 including Bank City, the Fairlands building (FNB and Wesbank) and more.
FirstRand’s overall major retrofits included upgrading its chiller system, solar geyser, light fittings and purchasing energy efficient equipment totalling R30 million. Over three years retrofitting efforts saved the group R19 million.
In 2008 Old Mutual Property retrofitted its Cape Town-based Cavendish Square Shopping Centre and Pretoria’s Menlyn Park Shopping Centre to improve heating and air conditioning systems at the respective centres.
More recently, energy efficient lighting was installed at the R1 billion redevelopment of Rosebank Mall by Hyprop Investments. The property company at its Clearwater Mall on the West Rand will install a solar power plant on the roof parking in November. If successful, the company might replicate the environmental initiative at some of its retail assets including The Glen, Hyde Park Corner and Canal Walk.