Are we back to a market driven sustainable property revolution?
The re-establishment of the axed ‘Climate Commission’ as a privately funded ‘Australian Climate Council’ to me is a clear sign that we are back in the mindset of ‘we are going to do something, regardless of political action for sustainability’. It is one of the beauties of democracy. So is this a sign that our property industry will pick up the reigns again and drive sustainability?
In the Howard years and pre-GFC (global financial crisis) I used to get asked the question – what is the major difference between sustainable property in Australia and Europe? My answer was typically along the lines of – in Europe sustainable property is driven by legislation and regulation and the market response was ‘how can I meet regulation at the lowest cost’. In Australia we were market driven, legislation was lacking, we didn’t have minimum energy standards in our building codes but the market with the help of Energy and Green Ratings for buildings, saw the opportunity to compete and differentiate by building property that was greener.
During the Rudd, Gillard, Rudd years and spurred on by the GFC Australian sustainable property seemed to shift into a legislation driven industry, we were meeting minimum compliance but not much more. We also weren’t building and designing as much, tenants weren’t moving as much and budgets were a lot tighter. The result – and this is my opinion so please shoot me down if you think I am wrong – the difference between how far we progressed as an industry from 2000 to 2008 compared to 2008 to 2013 is huge. We transformed as an industry in the first period and have maintained the status quo in the second period.
So is the establishment of a privately funded ‘Australian Climate Council’ an early sign or indication that we are going to shift back to our more successful 2000 to 2008 sustainable property revolution? I think it is and to be honest I can’t wait.
If we hadn’t had our minimum energy standards in place before our GFC and labour government era then we would have gone backwards, but luckily we had those in place so we have just been in a holding pattern, waiting for the market to take the lead.
Having worked in overseas legislation driven property industries and in our own market driven sustainable property industries in Australia, market driven is much more fun and more challenging. Yes regulation drives innovation, particularly in the down times but markets also drive innovation, particularly in the up times.