Australian commercial property funds are the global leaders when it comes to environmental sustainability and governance issues, an international survey reveals.
The 2014 Global Real Estate Sustainability Benchmark (GRESB) report found that the performance of property funds internationally had improved by nine points to 47 out of 100, with Australian and New Zealand-based commercial property funds topping the table with a score of 61.
The GRESB survey of 637 listed property companies and private equity real estate funds covering 56,000 buildings with a combined value of USD$2.1 trillion, reported that the commercial property sector had reduced its energy and water consumption in 2013, with carbon emissions also declining.
Data from the report showed that 70 per cent of commercial property funds in Australia and New Zealand were categorised as "Green Stars", compared with roughly a third of funds in Asia, Europe and North America.
The June 2014 Property Council/IPD Australia Green Property Index highlighted the benefits of environmental sustainability, showing ‘Green Star' rated funds outperformed the average fund, with annualised returns of 9.6 per cent for CBD office space to June 2014.
CBD office assets with high NABERS energy ratings delivered stronger investment returns (9.2 per cent) than assets with low NABERS Energy ratings (7.1 per cent).
The Property Council/IPD Australia Green Property Index said the outperformance of high NABERS Energy and Green Star rated offices was predominately driven by a higher capital growth component.
