By Max Clarke
An innovative business model that provides commercial tenants with on-going support to reduce their carbon emissions could redefine landlord-tenant relationships in the UK, according to independent analyst firm Verdantix.
Verdantix - in its March 2011 report “Low Carbon Real Estate Fund Launched in the UK”, - describes the unique approach to landlord and tenant engagement taken by the Low Carbon Workplace Partnership as “key to value add” for ‘green’ real estate funds. The initiative could pave the way to long term carbon efficiencies from existing building stock, it says.
The Low Carbon Workplace Partnership, set up in 2010 between the Carbon Trust, developer Stanhope and fund manager Threadneedle, invests in tired commercial office buildings and repositions them through extensive green refurbishments.
Low Carbon Workplace Ltd, a Carbon Trust subsidiary and exclusive Carbon Advisor to the Fund, partners with tenants through a pioneering agreement, the Low Carbon Workplace Charter, that stipulates the measures needed to manage their carbon footprint in an individual building on an ongoing basis. Achieving low carbon targets makes the tenant eligible for certification to the Low Carbon Workplace Standard, a new environmental benchmark for buildings.
Katharine Deas, Managing Director of Low Carbon Workplace Ltd, said:
“Even in the most carbon efficient buildings occupiers play the crucial part in minimising emissions. Yet many occupiers lack the specialist resources required to keep their carbon footprints down.
“Low Carbon Workplace is the first property initiative to identify and address this barrier by providing support on a long term basis. We believe it is an attractive proposition for any organisation looking to reduce its carbon emissions.”
Low Carbon Workplace recently announced the acquisition of its first four properties and has pre-let its first property — Premier House in Twickenham, Surrey — to the Thames Valley Housing Association.
Tenants now consider environmental efficiency to be a proxy for quality in the leasing market. This is the first example of a landlord and tenant proactively engaging on building carbon efficiency performance and it’s an approach that adds value for both parties” said Ray Crowley Verdantix analyst and author of the report.