The Business Case for Green Building in Serbia

Take-AwaysGreen building is vital for controllingglobal CO2 productionGreen building is here to stay• 45,000 LEED Registered Projects• 130 countriesBenefits are significant for allbuilding types © 2009 Yudelson AssociatesWater saving next major green focus

Life-Cycle-Cost Positive Solution Buildings are the only Life Cycle Cost-positive solution 25% of total carbon solution can come from buildings, including homes, stores, offices, hotels, institutional buildings and other structures © 2009 Yudelson AssociatesEMGP 270 Paris, HQE Certified

Triple Bottom Line Profit  Financial return  Marketing & PR  Higher Productivity Planet  Less carbon, waste and energy and water use People  Job satisfaction  Healthy work environment © 2009 Yudelson Associates

Range of Proven Benefits Absenteeism Rental Rates Carbon Emissions Occupancy Rates Energy Costs Office Productivity Hospital Stays Factory Productivity Waste Retail Sales Management Costs © 2009 Yudelson Associates Per Square FootPerformance on School Water Usage Tests

Importance of Building GreenBy the year 2040, 75% ofU.S. buildings will beeither new or renovated,vs. 2010 (23 billion m2)In Eastern Europe, focusis likely to be more ongreening of interiors,whole building renovationsand existing buildings. © 2009 Yudelson Associates 40 Grosvenor, London

U.S. Green Building Statistics 45,000 LEED registered projects (Jan. 2012) 10,000 LEED certified projects (Jan. 2012) 175,000+ LEED Accredited Professionals Similar results for UK’s OREGON BREEAM; DGNB gainingHEALTH & SCIENCE acceptance © 2009 Yudelson Associates UNIVERSITY

Central/Eastern Europe LEED Activity Country Cumulative LEED Other Countries Project Registrations (through January 2012) Poland 56 Bulgaria: 7 Hungary 24 Ukraine: 4Czech Republic 33 Austria 17 Croatia 9 Romania 10 Serbia 10 Slovenia 2 © 2009 Yudelson Associates Slovakia 6 Estonia 1 Nokia Jucu Factory, Romania, LEED-NC Latvia 1 Gold Total 180

Business Case for GreenFinancial/economic returnRisk managementMarketing/public relationsProductivity and healthRecruitment and retentionPolicy directivesInvestor interest is high TNT Express Headquarters AmsterdamSustainability concerns LEED-NC Platinum © 2009 Yudelson Associates Zero Carbon Emissions

Study Results Energy Star Buildings vs. Peers  $26/m2 rent premium  3.6% higher occupancy  Selling +$66/m2 LEED Certified Buildings vs. PeersNational Renewable Energy Laboratory, Denver  $122/m2 rent premium Zero Net Energy Building  4.1% higher occupancy LEED Platinum  Selling for +$1870/m2! © 2009 Yudelson Associates

LEED Rent Premium Gross Rents Office, 5 stories plus, 200,000 to 1 Million, Multi-tenant38 Source: CoStar36 35.45 3534 31.9732 31.36 31.43 31.25 30.9930 28.99 29.07 Energy Star LEED28 Overall26 © 2009 Yudelson Associates242220 Q42007 Q42008 Q42009

RICS Study Results Based on 2008 Data: 893 certified U.S. buildings, 10,000 non-certified within 0.4-km Conclusions:  Effective rent 6% higher  Sales price 16% higher  Green upgrade adds $5.5 million (€4 million) © 2009 Yudelson AssociatesMarks & Spencer Plan A to value

Relevance to Central/Eastern Europe Green building worldwide Uptake is rapid Property sector similar in many European countries Global companies want green spacesEuropark Salzburg Investors want greenGreen Retail Space buildings © 2009 Yudelson Associates

Productivity CountsMost costs are “peoplecosts”Studies show 3-7% gainin workplace productivity  A 1% gain in productivity pays all the energy bills  A 10% gain in productivity pays for © 2009 Yudelson Associates the entire building (or the technology)!

Marketing and Public RelationsBREEAM, LEED, DGNB Ideal toolsMany European projectsregistered under US LEEDSave energy, water, wastedisposal costsCreate green brandLow-cost options available © 2009 Yudelson Associates RWE Essen, Ingenhoven Architekten

Greening Existing Buildings: The Next Big Challenge 63 million m2 certified Largest LEED system International registrations up 22% in 2011Hines, Stuttgart, Germany Also covers majorLEED Core and Shell Gold renovations Hines, 26,000 m2 © 2009 Yudelson Associates

What Does This Mean in Eastern Europe? Green certifications add value Re-brand older spaces Large global companies want green office space Payback/ROI ~1-2 years Prevent value erosion of existing holdings © 2009 Yudelson Associates

Preventing Urban Water Crises • Urban water crises are likely to increase • Good design & practice can reduce water use +50% in buildings • Retrofits can reduce water use 35% to 75% © 2009 Yudelson Associates

Water Design Standards • Control site irrigation & cooling tower water use • Look at entire water cycle – Match quality with end use • U.S. good practice – 600 L/m2/year • Australian best practices: – 400 L/m2/a • German averages: © 2009 Yudelson Associates – 200 L/m2/aNuremburg, Germany

Future of Green Buildings in CEE Tenant demand + superior environmental performance are major driving factors in making green buildings mainstream. However, stricter government regulation in the EU is likely to be the main reason for green buildings to become the de-facto standard for new + renovated buildings in 10 years. --Deutsche Bank © 2009 Yudelson Associates Research, April 12, 2010.

Take-AwaysGreen building is vital for controllingglobal CO2 productionGreen building is here to stay• 45,000 LEED Registered Projects• 130 countriesBenefits are significant for allbuilding types © 2009 Yudelson AssociatesWater saving next major green focus

The Future is Green, But… If you want to score, run to where the ball is headed, not to where it is. Ask yourself and your clients: how green will the built environment be in 2015 to 2020? Non-performing green buildings will pay a © 2009 Yudelson Associates penalty in that market!

The Business Case for Green Building in Serbia

by Yudelson Associates

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