Green building certifications are becoming more popular in international property markets.

Major urban office markets around the world are seeing a considerable increase in the adoption of “green” building certification schemes, according to the inaugural International Green Building Adoption Index (IGBAI), a study by CBRE and Maastricht University (Netherlands). According to the survey, 18.6% of space in ten markets throughout Australia, Canada, and Europe is now certified “green,” compared to only 6.4 percent in 2007.

Canadian cities are leading the way, with 51.6 percent of area in Vancouver and 51.0 percent in Toronto certified as “green.” This is especially noteworthy in Vancouver, which has a formal goal and action plan — “Greenest City 2020” — to become the world’s greenest city by 2020. Green building trends will continue to drive both new development and refurbishment of office product in Vancouver and Toronto. More than half of the 1.5 million square feet of product under construction in Vancouver is being built to strict green certification standards, while much of Toronto’s existing class A product is undergoing extensive capital improvement projects that include upgrades aimed at achieving green certifications as well. buying a house in qatar

Increased demand for ecologically responsible buildings from governments, corporate tenants, and institutional investors has been especially noticeable in places where “green” structures made up almost no portion of the office market just a few years ago. For example, the “green” office square footage in Sydney and Melbourne, Australia’s third and fourth cities in the ranking, increased from less than 1% in 2006 to more than 46 and 28.8%, respectively. Furthermore, the “green” office market in Warsaw was virtually non-existent until 2010, but currently accounts for 21.3 percent of the space tracked by CBRE.

Even the markets with the smallest share of green office space as a percentage of total office property inventory experienced significant increase. Green building certifications in Paris, the study’s largest market, increased from 0.1 percent in 2007 to 9.1 percent in 2017, while London, the study’s second largest market, increased from 0.2 percent in 2010 to 8.7 percent in 2017.

Frankfurt, for example, reported 17.5 percent green product, up from 1.4 percent in 2009; Stockholm, 12.6 percent, up from 1.2 percent in 2011; and Amsterdam, 11 percent, up from 0.1 percent in 2011. ​

In several of these places, green properties have outperformed the market. As an example:

According to estimates from Australia’s Green Property Index, the total three-year annualized return for “Green Star” six-star rated office buildings was 15.6 percent in 2017, compared to 12.8 percent for the rest of the market.

In the first nine months of 2017, certified green buildings accounted for a quarter of Frankfurt’s 4.6 million square feet of leasing activity, including two of the market’s largest leasing deals, totaling 151,000 and 75,000 square feet, respectively.

Buildings, particularly commercial buildings, have long been at the forefront of urgent challenges such as water, waste, and considerable energy use, as well as the resulting carbon emissions “CBRE Senior Vice President, Global Client Care/Sustainability David Pogue remarked. “Green building certification schemes are becoming considerably more popular and relevant to a number of constituents and stakeholders as attention to these concerns grows.”

Despite the fact that there are numerous local building certification schemes, internationally recognized green building credentials are more extensively used in the commercial real estate sector. Such standardized environmental performance metrics are required by tenants and investors “Dr. Rogier Holtermans, the project lead for the International Green Building Adoption Index, stated.