Building owners interested in increasing long term returns could do worse than take a sustainable approach to building management.
10 years of research have proven that far from costing money, thinking like a greenie is smart business.
The principle is easy to grasp: Just as a well-tuned car burns less fuel and oil, a well-maintained building uses less energy.
It’s also more appealing to tenants and is likely to attract a better price when sold.
But the burning question for many owners has been whether the numbers stack up. Are the costs outweighed by the savings and returns?
The jury’s in, and the answer is a resounding “yes”.
A 2009 study of 643 buildings in the United States, for instance, found that while average commissioning costs amounted to less than 0.5% of the overall construction cost, good commissioning practices delivered a 16% energy saving for existing buildings and a 13% saving for new ones.
So why doesn’t every building owner insist on the highest standards of building maintenance? Because doing so has been a lot harder than it it looks.
Building a sustainable building is one thing. Keeping it operating sustainably is a whole other matter, and one that demands massive attention to detail. The fact is, few owners have the means of acquiring the detailed information needed, or of managing it over time.
The typical approach in New Zealand is walk-throughs and audits by an experienced builder, usually with a clipboard or Excel spreadsheet at hand. But that’s simply not enough.
International best practice demands sophisticated software that doesn’t rely on the quality of the inspector (which varies greatly in New Zealand), but instead provides systematic questionnaires, coupled with drop down menus that drill into the detail of every aspect of a building. The result is a standardised, rigorous, highly detailed view of the building that’s independent of the subjective views of the person conducting the audit.
A software-driven approach also ensures nothing gets missed, and consistency of audits over time that allows for long-term maintenance planning.
Often that means paying attention to operational details. "A lot of little things add up to huge value; to tons of waste saved and cost taken out," says Sean Delehanty, Electronic Systems sustainability manager, BAE Systems. A case in point: When one BAE Systems' facility, which already was Energy Star certified, increased the amount of material recycled by seven percent, it reduced its solid waste disposal by 10 percent, saving $10,000 annually.
Bringing a new approach to New Zealand building maintenance
When we established Foundation One in 2015, it was with a commitment to empowering property owners and managers to raise productivity, lower costs, and increase margins.
For the last four or so years, we’ve done that largely by consolidating trade services under one roof, led by a hand-picked team of experienced, customer-service oriented tradespeople. Instead of searching through their contact list for a supplier who can deal with an urgent and tricky plumbing issue right now, Foundation One clients call us. Problem sorted.
The time has come to address the long term equation: Assessment and planning.
In 2019, we are launching a new service that will lead the market in building assessment. As discussed above, it will be driven by sophisticated software that eliminates subjectivity and ensures every aspect of a building’s condition is accounted for.
Alongside that, we are creating a service to support clients in analysing the detailed reports that this new approach will generate, and creating long term maintenance plans that will reduce costs and increase returns over time.
Other countries have recognised the value of this approach. In the US, banks will often demand software-based assessments before lending on commercial buildings. Similarly, company boards expect to see sustainable maintenance plans based on solid data.
A PWC survey of a thousand CEOs from 43 countries revealed that 79% believe sustainability is vital to profitability. Sustainable practices reduce risk, increase efficiency, and reduce environmental and social concerns.
They also drive margins upwards. In sophisticated markets, commercial buildings are treated less like cost centres – where maintenance spend is a grudge purchase – and more like the business investments they really are. The question is not “how do we minimise maintenance costs?” but “how do we maximise the long term sustainability and returns from this asset?”
As visibility of building performance improves in New Zealand, demand for higher quality maintenance services will follow. The days of ad hoc maintenance, delivered by tradespeople of varying skills, are numbered. New Zealand commercial property owners can look forward to professional service levels from maintenance companies as the norm, not the exception.
This is good for property owners, managers and tenants. It’s good for business. And we look forward to sharing more about how it will be possible over the next few months.