The commercial real estate sector in India is undergoing significant shifts. Occupiers, investors, and regulators are becoming more and more focused on sustainability, making green buildings the emerging standard in commercial property development. In an organization like RES Management, whose focus is commercial property and real estate services, following along with this trend is not just smart, but needed.
Why Green Buildings Matter in Commercial Real Estate
Green buildings are buildings that have less environmental impact due to the efficient use of energy, water, and materials, as well as a better quality of the indoor environment. There is a growing appeal for green certified buildings for those in the commercial environment. Recent research suggests that there is a growing demand for certified green buildings, particularly from Global Capability Centers (GCCs) and IT/ITeS companies in India, even if it means incurring a modest premium at the outset.
Despite the fact that green construction can incur an average premium of about 3-5% in initial cost, the long-term benefits make it an attractive and wise investment. The benefits include energy savings of up to 30-35%, reduced water consumption, a healthier indoor environment, and improved brand space. Grade A office assets with green certification often have higher average rents and higher rates of occupancy rates.
Challenges & Mitigation
Higher upfront cost: While initial costs may be higher, lifecycle cost savings often recover that over time.
Technical expertise: Skilled architects, engineers, and sustainability consultants are needed to get certification and maintain standards.
Tenant education: Some tenants may resist paying a premium; educating them about long-term savings helps.
Certification process complexity: Obtaining LEED, IGBC, or other certifications can be demanding. A systematic approach and experienced team are essential.
How RES Management Helps You Invest in Green Buildings?
RES Management makes green building investment simple and rewarding:
Premium Properties: We help you invest in premium properties with either IGBC/LEED certified commercial projects. Contact Us Now
Market Insights: We provide you with market intelligence on which commercial investments are in high demand and best suited for the future.
Developer Partnerships: Collaborate with trusted, sustainable developers.
Tenant Benefits: Invest in commercial premises that tenants want to occupy because they have lower operating costs and brand value.
Certification Support: We provide certification support with respect to LEED, IGBC, and GRIHA.
Long-Term Returns: We facilitate predictable occupancy levels, rental premiums, and increased value of the property.
Discover our new commercial project in Ahmedabad
Follow our blogs and get more info about commercial real estate
FAQ
1. What exactly qualifies a building as “green”?
Green buildings are considered a structure that consumes less energy and water, maximizes resource efficiency, decrease waste, and provide a better indoor space than a non-green building.2. Do green commercial buildings cost significantly more to build?
Yes, about 3-5% more than a regular brand-new commercial building. But that premium is often offset by lower operating costs over the life of the building.
3. What savings can tenants expect?
Tenants can potentially save 30–35% on energy bills due to efficient systems, reduced water usage, and overall resource optimisation.
4. What types of certification are relevant in India?
The most commonly used certification systems to measure best practice in the sector include IGBC (Indian Green Building Council), LEED, GRIHA, and so on.
5. How do tenants perceive green buildings? Are they willing to pay a premium?
Definitely. Quite a few enterprises - particularly global companies - prefer to have green certified spaces as part of their ESG commitments. They sometimes accept a little higher rent due to sustainability improvements.
6. What is the payback period for green investments?
While it depends on the building's running expenses, there are many green buildings where operational cost savings overcome the initial premium expense within a 5-10 year horizon. Getting to that point all depends on the level of energy efficiency and the way the buildings are used.
7. Does green certification improve property valuation?
Yes - properties that have green credentials often fetch a higher property value, better lease terms, and more consistent occupancy.
