Rethinking The Australian Office

Of these five, the landlord can upgrade services and spaces to improve the quality of the asset, however quality is a somewhat subjective term. While building grade is often used, the quality of an asset can vary significantly within the same grade. To overcome this issue, a proxy measurement that mirrors building quality without directly measuring it is required. National Australian Built Environment Ratings System (NABERS) energy ratings provides a suitable alternative for a number of reasons: • It offers a numerical grading system (1 through 6) that covers a large sample of buildings; of the 813 non-strata buildings across the Sydney and Melbourne CBDs included in this study, 299 are NABERS rated. - 95% of Premium assets, 74% of Grade-A assets and 36% of B-grade assets are rated. - 98% of assets above 20,000 sqm, 66% of buildings between 10,000 and 20,0000 sqm, 35% of buildings between 5,000 and 10,000 sqm are rated. • NABERS ratings are also positively correlated with building grade and negatively correlated with the date of last refurbishment of the building (i.e., buildings that have been more recently refurbished tend to have higher NABERS ratings). These all point to NABERS being a good proxy for the quality of a building in this study, especially the correlation with the date of most recent refurbishment. • It increases with grade and size:

AS COMPANIES ADJUST TO A FLEXIBLE WORKING

ENVIRONMENT, THE QUALITY OF A WORKSPACE HAS BECOME A KEY DRIVER OF TENANT DEMAND. GENERALLY, THE QUALITY OF A BUILDING CAN BE NARROWED DOWN TO FIVE BROAD CATEGORIES:

1. SITE Proximity to public transport and central business districts.

2. STRUCTURE Efficient floorplates and modern core placements.

3. SERVICES State-of-the-art HVAC systems and energy-efficient lighting.

4. SPACES Flexible layouts that support various work styles.

5. SCENES Regular events and pop-up installations that engage tenants.

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