HOW TO SELL RES-PROJECTS IN ROMANIA

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Barrie Ball
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2 HOW TO SELL RES-PROJECTS IN ROMANIA CONTENT COMPANY INTRODUCTION STARTING POSITION DEFINING GREEN RES PROJECTS RES PROJECTS LEED GREEN STANDARD ATR & GRID CONNECTION CONTRACTS GREEN CERTIFICATION ATR FOR & GRID DEVELOPERS CONNECTION CONTRACTS VALUE OF GREEN BUILDINGS TO TENANTS VALUE OF GREEN BUILDINGS TO INVESTMENT FUNDS SUMMARY SPIEGELFELD INTERNATIONAL SRL - 5 Herastrau Str., Bucharest, , office@spiegelfeld.ro 2

3 COMPANY INTRODUCTION Headquarters in Vienna, Austria Main Focus: Commercial Real Estate Brokerage, Appraisal and Consulting Founded in 1985 Largest privately RES held PROJECTS real estate agency in Austria RES PROJECTS 2000 Start of our CEE ATR Expansion & GRID with direct CONNECTION offices all over CEE and partner offices all over CONTRACTS Europe ATR & GRID CONNECTION 2004 Foundation of Spiegelfeld CONTRACTS International in Romania, BG, Ukraine & Serbia 2009 Establishment of a RES-Department in Romania with main focus on Wind- & Solar-(PV) & Hydro-Projects SPIEGELFELD INTERNATIONAL SRL - 5 Herastrau Str., Bucharest, , office@spiegelfeld.ro 3

4 STARTING POSITION The market has been focussed on short term solutions. There has been a lack of perceived differentiation between good and not so good buildings. There has been little legislation which penalises inefficiency or pollution, but this is changing as the EU flexes its muscles. There has been insufficient focus on good design, a lack of local design teams with strong environmental experience and a lack of clients willing to pay for the skills of good design which are available. There has been a lack of skilled project and cost management which give visibility to the costed alternatives available via life cycle costings and who can track cost and value. SPIEGELFELD INTERNATIONAL SRL - 5 Herastrau Str., Bucharest, , office@spiegelfeld.ro 4

5 STARTING POSITION There has been a lack of on site quality control which means that even well designed and specified buildings may not be either constructed well or in a green manner and workmanship is frequently just very poor which leads to energy leaks. There is no international compliance of the existing standards. A gold certificate of one certification does not mean gold standard of the other one. Nobody knows which green certification to choose or comply to. Everybody thinks that building green is very expensive and takes huge efforts to achieve. Nobody sees clear advantages of building green. SPIEGELFELD INTERNATIONAL SRL - 5 Herastrau Str., Bucharest, , office@spiegelfeld.ro 5

6 DEFINING GREEN But what does it mean Green? and do we need that afterall? SPIEGELFELD INTERNATIONAL SRL - 5 Herastrau Str., Bucharest, , office@spiegelfeld.ro 6

7 DRIVERS TO GO GREEN Shift in Public Opinion (customer-, staff- and shareholder opinion) Stronger International Legislation EPC Energy Performance Certificates CSR - Corporate Social Responsibility Reducing Costs Reducing Independencies Improving i Efficiencyi Improving Productivity SPIEGELFELD INTERNATIONAL SRL - 5 Herastrau Str., Bucharest, , office@spiegelfeld.ro 7

8 DRIVERS TO GO GREEN Buildings in general contribute up to 23% of CO2 emissions 40% of energy requirements 16% of water usage 30% of solid landfill waste 40% of raw materials 71% of electricity consumption SPIEGELFELD INTERNATIONAL SRL - 5 Herastrau Str., Bucharest, , office@spiegelfeld.ro 8

9 DEFINING GREEN A Green building generally refers to a building or an asset which has been designed to be created and operated using processes that are environmentally responsible and resource-efficient: from its site selection over construction, operation, maintenance, renovation, and finally demolition. Key is the objective to: Efficiently using energy, water, air, heat and any other resources. Protecting occupant health and improving employee productivity. Reducing waste, pollution and noise. SPIEGELFELD INTERNATIONAL SRL - 5 Herastrau Str., Bucharest, , office@spiegelfeld.ro 9

SO HOW DO WE GET GREEN? There are 2 main standards: LEED and BREEAM, besides DGNB and ÖGNB What makes a building green according to the LEED standard?

10 SO HOW DO WE GET GREEN? There are 2 main standards: LEED and BREEAM, besides DGNB and ÖGNB What makes a building green according to the LEED standard? Sustainable Site Water efficiency Energy & Atmosphere Material & Resources Indoor Environmental Quality Innovation & Design Regional Priority 28 Points 10 Points 37 Points 13 Points 12 Points 6 Points 4 Points Total Points achievable: 110 Points SPIEGELFELD INTERNATIONAL SRL - 5 Herastrau Str., Bucharest, , office@spiegelfeld.ro 10

11 LEED Sustainable Sites (28 points) Use of brown field sites High h site density Access to public transport Bicycle racks and showers Encouraging g g low emission cars by providing discounted spaces Parking to meet but not exceed regulations Restoration of existing vegetation and habitat on non built areas Provision of open spaces for pedestrians Storm water management plan to reduce run off Reduction in heat island effects by using covered car parking and use reflective roofing materials Reduction in light pollution by reducing interior and exterior lighting solutions SPIEGELFELD INTERNATIONAL SRL - 5 Herastrau Str., Bucharest, , office@spiegelfeld.ro 11

12 LEED Water Efficiency (10 points) Overall reduction in water use >20% against benchmarked data by the use of low water fixtures throughout the building Reduction of 50% in landscape water use innovative solutions to reduce waste water by 50% by the use of on site treatment, etc. SPIEGELFELD INTERNATIONAL SRL - 5 Herastrau Str., Bucharest, , office@spiegelfeld.ro 12

13 LEED Energy & Atmosphere (37 points) Minimum energy performance improvement of 10%. Refrigeration management by the reduction and exclusion of CFC using equipment and omission of ozone depleting fire suppression systems. Optimized energy performance for higher ratings (higher savings higher points). On site renewable energy. Enhanced h d commissioning i i specialists. Measurement and verification plan to confirm simulation with actual energy results and to action corrective e measures es if there e is a mismatch. Measurement of tenants energy use via sub metering. 35% of energy purchased from green energy suppliers. SPIEGELFELD INTERNATIONAL SRL - 5 Herastrau Str., Bucharest, , office@spiegelfeld.ro 13

14 LEED Materials & Resources (13 points) Provision of storage and collection areas for recyclable goods. Reuse existing structures rather than knock down and rebuild. Recycle y and/or salvage non hazardous construction and demolition debris. Use salvaged, refurbished or reused materials. Use materials with recycled content. Use building materials or products that have been extracted, harvested or recovered, as well as manufactured within a specified distance. Use a minimum of 50% of wood-based materials and products, which are certified in accordance with the Forest Stewardship Council s (FSC) Principles and Criteria. SPIEGELFELD INTERNATIONAL SRL - 5 Herastrau Str., Bucharest, , office@spiegelfeld.ro 14

15 LEED Indoor Envrionm. Quality (12 points) Install permanent monitoring systems to ensure that ventilation systems maintain design minimum i requirements. Increase breathing zone outdoor air ventilation rates to all occupied spaces by at least 30% above the minimum rates specified. Develop p and implement an Indoor Air Quality (IAQ) Management Plan. All adhesives and sealants used on the interior of the building shall comply with the requirements. Paints and coatings used on the interior of the building shall comply with the criteria. Flooring elements installed in the building interior must meet the testing and product requirements. Composite wood used on the interior of the building shall contain no added urea-formaldehyde resins. Employ permanent entryway systems (permanently installed grates, grilles, etc.) to control chemical. SPIEGELFELD INTERNATIONAL SRL - 5 Herastrau Str., Bucharest, , office@spiegelfeld.ro 15

16 LEED Innovation (6 points) Achieve significant, measurable environmental performance from non standard: Bird collision avoidance material Non use of solvents Innovation in ventilation Power generation Chilled beams Green wall designed Complete the LEED Life Cycle Costing schedule and submit it! At least 1 principal participant of the project team shall be a LEED Accredited Professional (AP) SPIEGELFELD INTERNATIONAL SRL - 5 Herastrau Str., Bucharest, , office@spiegelfeld.ro 16

17 LEED Analysis Form SPIEGELFELD INTERNATIONAL SRL - 5 Herastrau Str., Bucharest, , office@spiegelfeld.ro 17

18 Green Certification for Developers Higher Requirements Real l Committment t Knowledge & Planning Management Understanding g of Technology Supervision Source: EC Harris SPIEGELFELD INTERNATIONAL SRL - 5 Herastrau Str., Bucharest, , office@spiegelfeld.ro 18

19 Green Certification for Developers Plan early! Select a brown field site that you were going to develop anyway. Find a little bit of pollution and clean it up. Undertake environmental studies about wildlife, trees, etc. Engage a company to model the energy performance of the proposed systems. stems Obtain a natural light study. Tell the contractor to use materials from sustainable sources and not to deposit waste in landfills. Engage a separate company to commission your M&E systems. SPIEGELFELD INTERNATIONAL SRL - 5 Herastrau Str., Bucharest, , office@spiegelfeld.ro 19

20 Value of Green Building vs. Conventionals Source: EC Harris SPIEGELFELD INTERNATIONAL SRL - 5 Herastrau Str., Bucharest, , office@spiegelfeld.ro 20

21 Value of Green Buildings to Tenants Better working environment. Higher motivation to go to work. Higher presence rates / Less illnesses. Improved Health & Well-being at work. Higher Staff Productivity. Identification with the company and its values. Improved (building) communications. Higher Security. Reduced operating costs (service charges). (One day maybe also) Lower leases. Less maintenance. Energy price dependency vs. fixed price energy deals SPIEGELFELD INTERNATIONAL SRL - 5 Herastrau Str., Bucharest, , office@spiegelfeld.ro 21

22 Value of Green Buildings to Tenants DIRECT COST BENEFITS for an occupier Source: EC Harris SPIEGELFELD INTERNATIONAL SRL - 5 Herastrau Str., Bucharest, , office@spiegelfeld.ro 22

23 Value of Green Buildings to Investment Funds Longer & Improved Lifecycle of Building Less maintenance costs / Less service charges to tenants Renovation cycles extended Protection against future environmental taxation Sustainable Property Value due to all-in-all higher property quality Higher h Security Importance of Sustainability Ratings for Buildings or Portfolios Crisis resistant properties / portfolios Faster lease-up pperiods / Higher Tenant Retention Capital Costs Savings Property has an USP Improved Marketability Higher demand in the future for such buildings HIGHER & MORE STABLE (EXIT) YIELDS! SPIEGELFELD INTERNATIONAL SRL - 5 Herastrau Str., Bucharest, , office@spiegelfeld.ro 23

24 Value of Green Buildings to Investment Funds Source: EC Harris / GBC Australia SPIEGELFELD INTERNATIONAL SRL - 5 Herastrau Str., Bucharest, , office@spiegelfeld.ro 24

25 SUMMARY Developments can be constructed at no additional construction costs and achieve a positive LEED/BREEAM rating, but clients will need to invest in high quality design management and some studies. It is anticipated that a very good BREEAM (Gold LEED) rated building (recommended) will cost approximately a fraction more than a non rated building of a similar quality approx. 6%(!). Without good experienced design and management teams appointed early, significant additional costs will be incurred when considering green options later. Simple p passive design features will achieve the highest returns. Green buildings are generally designed better, constructed to a higher standard and maintained well throughout their life time. Green buildings are perceived as future proof with the potential to generate premium returns. Green buildings have proven to be more crisis resistant in volatile market periods Green buildings will make more money! GOING GREEN IS NOT AN OPTION! IT IS THE FUTURE! SPIEGELFELD INTERNATIONAL SRL - 5 Herastrau Str., Bucharest, , office@spiegelfeld.ro 25

26 PLEASE CONTACT SPIEGELFELD INTERNATIONAL SRL - 5 Herastrau Str., Bucharest, , office@spiegelfeld.ro 26

Sustainable Design A DIVISION OF SHIVE-HATTERY

Sustainable Design A DIVISION OF SHIVE-HATTERY our transition to sustainability must be a deliberate choice to leave the linear surge of an extractive economy and enter a circulating, renewable one. Janine