Demand for green buildings in Malaysia to rise, says property consultancy

KUALA LUMPUR: The demand for buildings equipped with green technology will continue to rise as environmental awareness grows and more companies embrace corporate social responsibility, said CB Richard Ellis (CBRE) Research, Asia in a special report – Malaysia Market Prospects today (Jan 27).

It said multinational companies will be at the forefront of the trend of increasingly adopting a commitment to leasing green office space wherever possible.

Citing an example, Shell, an oil and gas multinational firm operating extensively in Malaysia, is reported to have specifically requested that 348 Sentral achieves the Leadership in Energy and Environmental Design (LEED) - Gold certification as part of its tenancy agreement.

Another driver of this trend is the growing body of evidence demonstrating that green buildings make financial sense as studies from mature markets such as Australia and the US have found that developing green buildings can help landlords achieve higher values, fetch higher rents and enjoy higher occupancy rates than comparable non-green buildings.

The move towards sustainability in the Malaysian real estate sector is anticipated to usher in a more challenging future environment for existing building owners striving to remain viable amidst a potentially large supply of newer and greener office buildings in the years ahead, CBRE Research, Asia said.

It added that while non-green buildings will continue to constitute the bulk of available commercial stock for the foreseeable future, owners may find themselves under increasing pressure to retrofit them to higher environmental standards in order to remain competitive.

CB Richard Ellis (CBRE) (Malaysia) Sdn Bhd’s managing director, Alan Soo said: “The move towards green buildings is something which assumed considerable importance in a very short space of time.” CBRE (Malaysia) today (Jan 27) renamed itself from Regroup Associates Sdn Bhd.

The government in May last year launched the country’s green building rating system known as The Green Building Index (GBI) towards promoting the construction of environmentally-friendly buildings in Malaysia.

The GBI is modelled on international green building rating systems such as LEED and Building Research Establishment Environmental Assessment Method or BREEAM and was jointly developed by the Malaysian Institute of Architects and the Association of Consulting Engineers Malaysia.