How companies can fastrack their ESG goals
The fastest route is to lease space in green buildings, CBRE advised.
Leasing within green buildings has become the optimal path for Hong Kong companies in driving environmental, social, and governance (ESG) initiatives, CBRE said in its “ESG Beyond E: Strengthening Social and Governance Standards in Hong Kong's Workplace” report.
According to CBRE's findings, the percentage of green-certified office spaces in the city's emerging submarkets is steadily increasing in tandem with the rise of new office constructions. These upcoming buildings are highly likely to achieve green certification upon completion, emphasising the industry's demand for sustainable practices.
The largest volume of green space is in the CBD, with 65% or 9.3 million sq. ft. (net floor area) of Grade A office space in Central possessing green accreditation, followed by Hong Kong East with 7.4 million sq. ft.
Meanwhile, 42% of office areas in Hong Kong's decentralised office submarkets have already obtained green certification, covering a substantial 18.1 million square feet of space. This figure can be attributed in part to the prevalence of single-owned buildings on Hong Kong Island, which account for 47 green buildings or 21 million square feet.
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Data from June 2023 revealed that 30% of Hong Kong's Grade A buildings had received green certification, with 80 buildings currently holding valid accreditation. Notably, 75 of these buildings were single-owned, reflecting the remarkable rates of ESG adoption among portfolio landlords in the city.
CBRE also highlighted the trend of retrofitting older properties to meet modern ESG standards. By integrating green features, portfolio landlords enhance competitiveness against newer constructions. As of June 2023, 74% of Hong Kong's green-certified Grade A offices were retrofitted properties.
“Whilst the availability of green buildings is growing in emerging submarkets, mature core and decentralised submarkets continue to register a higher proportion of green space. Leading portfolio landlords are taking initiatives to retrofit their buildings with green features to enhance their competitiveness. The existence of 31.5 million sq. ft. of space in single-owned non-green-certified buildings should see landlords continue to invest in green retrofits and other forms of asset enhancement in the coming years,” said Marcos Chan, executive director, head of Research at CBRE Hong Kong.