‘Rendering existing property more sustainable is a big problem,’ says Nina van den Berg. As a project manager at Green Business Club Zuidas, she is responsible for energy, waste and mobility. Saving energy is complex in the sector because the building owners are not always the same as the building users. ‘If an owner improves energy consumption in his building, it’s the occupant who benefits,’ is how Van den Berg summarises the problem. ‘So the advantage does not accrue directly to the party paying for it’.
‘Split incentive’
Van den Berg calls it the ‘split incentive’, which expands further once you dive into the subject matter. The first thing that does not help is that building owners often reside elsewhere in the world. Secondly, they do not have to worry about letting their property as demand for office space in Zuidas is abounds. There is a third issue, however: many buildings have multiple tenants. And with these ‘multi-tenant towers’ comes another stakeholder in the property arena: the manager.
‘How can this be true?’
Owners hire building managers to handle electricity and water, for instance. Tenants pay a ‘service fee’ for this, part of which the manager keeps. So the stimuli work the other way, explains Van den Berg. ‘It is better for a manager for the service fee to be high, so he’ll get more.’ She remembers talking to a manager in Zuidas, whose name she won’t mention. When Van den Berg told them about energy-saving measures, the manager said they would never implement such measures because they reduced the service fee, and with that his source of income. ‘His trainee stood there next to him and seemed completely confused,’ says Van den Berg ‘Really? How can this be true? Does it work like this?’ Clearly it does. Van den Berg does not think the system will change anytime soon. ‘This is what the business model is like.’ In discussions about how to do things differently, she often encounters the ‘computer says no mentality’.
Energy audits
For a while, this mentality seemed to change due to new legislation. Since 2016, big companies with a revenue exceeding 50 million euros per year or over 250 employees must submit to a so-called energy (EED) audit. In the audit, they have to report on their energy consumption and plans for savings. In the next audit four years later, they have to show whether they achieved their targets. Van den Berg was initially happy with the new legislation, thinking it would help her get companies moving. Unfortunately, nothing of the kind happened. In the case of multi-tenant towers, the audit requirement is not the various users’ responsibility because individually, they cannot help it if other users leave the lights on or the windows open – with the attendant consequences for the tower’s overall energy consumption. Because the manager is at the controls, the environmental department generally audits them. Management organisations are generally small, however. ‘Often no more than three or four people walking around in these buildings. They are not happy having to provide all that evidence and are sometimes even exempt from the audit requirement due to their limited size.’ Which means that audit-exempted building managers are cheaper, which may make them more attractive to new customers. So the stimuli to improve sustainability are still pointing the wrong way.
WTC
There are exceptions, says Van den Berg. She is enthusiastic about WTC above all. ‘They are doing really well because the managers have a long-term relationship with the owner. The managers came to feel very strongly about sustainability themselves, and the owner gives them space to implement the right measures. The parties realise that a building becomes more valuable from a commercial perspective when it is more sustainable. More and more, companies consider sustainability aspects when selecting office space, so a sustainable property portfolio is more valuable, in the end.’ We can only hope that building owners figure this out quickly.
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