Make no mistake – environmentally sustainable real estate is extremely important for India today. Given the massive demands on infrastructure, energy, potable water and waste handling and disposal, there are no other options for the real estate sector but to go green. Given that low cost housing is bound to see a huge growth in the next two decades and more than 60% of India’s infrastructure yet to be built, residential and commercial property developers are now increasingly being prevailed upon to evolve and incorporate green features
India Is Not A Slow Green Adopter
The common perception is that India was generally a late adopter of the ‘green’ mantra in real estate. However, the country has not lagged behind on this front at all. In fact, the growth of green real estate in India is a saga of some compelling and impressive statistics.
According to the Indian Green Building Council (IGBC), green real estate in India has grown from a mere 20,000 square feet in 2003 to a little over 3.0 billion square feet of registered, pre-certified and certified projects in 2015. Of this, green office spaces account for 200 million square feet, primarily in the 10 major cities.
Contrary to common belief, Indian developers are not ‘going green’ merely because more and more MNCs will now consider moving only into certified green office spaces in India. The demand for green office spaces is equally high among Indian corporates; some of the top Indian MNCs have now included green office spaces in their corporate sustainability objectives.
This indicates that India is far from a reluctant adopter of green real estate practices. The growth supports the premise that the necessary market drivers – high consumer demand for green office and retail spaces, and the need to mitigate the high cost of energy and water needed to operate a building – are in place. In many cases, the requirements laid out by the Ministry of Environment, Forest and Climate Change (MOEF) for projects over 20,000 square metres has helped the cause of green commercial real estate, as well.
Today, a large number of IT / ITES companies and BFSI firms have an explicit ‘green’ mandate when it comes to leasing commercial spaces. Bank of America Continuum, Citibank, UBS, Inautix and Intuit (among others) are some of the firms that are firmly committed to occupy sustainable office spaces.
IGBC, which works under the aegis of the Confederation of Indian Industry, spearheaded the initial awareness drive, and the members of CII were the first to imbibe green concepts in their CII Sohrabji Green Business Centre in Hyderabad. The GBC was the first LEED Platinum building in India. Today, every leading Indian corporate from ITC, Godrej, Wipro and Infosys to Mahindra, Kotak and CII itself, have opted for green offices.
The Green Rationale
There is more to the green office realty movement than goals related to carbon footprint, CSR and enhanced corporate image. The improved indoor air quality, better ambience, natural lighting and comfort cooling control in sustainable office spaces have been proven to improve employee productivity and wellness. There are sound business fundamentals involved, as well.
A typical 100,000 square foot green office building saves the occupier Rs. 30 to 40 lakh in a year on energy alone. Savings in water could be close to half this amount. In comparison to conventional office spaces, green offices are 20-30% more efficient on the use of water and energy. Of course, there are added costs to green office spaces, as well. Office rental benchmarking studies in the 7 major cities have revealed a typical premium of 2-3%.
A large number of developers have now recognized the importance of building green because it improves the lease probability in a market that is currently witnessing parity between supply and demand. Simply put, corporates that are committed to green office spaces prefer leases in buildings whose core and shell is certified green – and such corporates are on the increase.
Common Features In Green Office Spaces:
The features typically found in green offices include space design and fittings which enhance energy and water efficiency while simultaneously providing occupants with higher levels of comfort, ventilation and glare free illumination.
Authored by: Rajat Malhotra, COO – Integrated Facilities Management (West Asia), JLL India
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