Decarbonisation, climate reporting, carbon accounting, carbon footprint, carbon emissions
How a NABERSNZ Rating Improves ROI
The importance of sustainable building practices and energy-efficient properties cannot be overstated in today’s environment. NABERSNZ offers a holistic, thorough, and government-recognised (and in some cases, mandated) green building rating.
But it offers far more than just compliance. A NABERSNZ rating, taken voluntarily, provides significant return on investment for owners, tenants, and property managers. Here’s what you need to know.
What is NABERSNZ?
NABERSNZ is a comprehensive performance-based rating system that evaluates a building's environmental impact, focusing primarily on energy use and efficiency.
Originally, NABERS was an Australian creation, but it is also available to New Zealand businesses via the New Zealand Green Building Council (NZGBC).
Understanding the NABERSNZ rating system.
The NABERSNZ rating system examines several key areas to determine a building's environmental performance. These include energy efficiency, water usage, waste management, and indoor environmental quality. The rating system assigns a score between one and six stars, with one star representing poor performance and six stars indicating market-leading performance.
NABERSNZ ratings are determined through a rigorous assessment process, from an accredited provider, that takes into account various factors such as the building's location, occupancy, and operational hours. This ensures that the rating provides a fair and accurate representation of the building's environmental impact.
Once the initial rating is completed, a NABERSNZ rating must be re-assessed every year to remain valid.
What is the ROI of a NABERSNZ rating?
Government now mandates a good quality NABERSNZ rating for the properties they occupy. These tenancies are highly desirable, in that they often result in long-term leases with tenants that have an excellent credit rating.
However, this is just part of the appeal of NABERSNZ and only a single slice of its true ROI. These are some of the others.
1. Greater tenant demand.
A more efficient building is not only more attractive to tenants but also more cost-effective, as it requires less expenditure on utilities. In addition, a growing awareness of climate change and the importance of sustainable living, tenants are seeking buildings that align with their values and environmental concerns.
A NABERSNZ rating serves as a testament to a building's efficiency and sustainability credentials. In essence, it provides tangible proof of a building's environmental performance, which can be a significant draw for environmentally conscious – and cost-conscious - tenants.
2. Enhanced property value.
In the competitive property market, a NABERSNZ rating can provide a significant market advantage. A higher rating can help differentiate your property from others and position it as a more sustainable, efficient and attractive option. This increased desirability can translate into higher rental rates, lower vacancy rates, and ultimately, a higher property value.
For examples, we can look to Australia, where NABERS was originally created. Knight Frank found that office buildings with a 4.5 NABERS rating saw an 8 per cent premium on sales price compared to unrated buildings. Buildings with even higher ratings could achieve a huge 18 per cent premium.
This clearly demonstrates the positive correlation between higher NABERSNZ ratings and increased property value. Properties with higher ratings tend to outperform the market, making a strong case for investing in sustainability measures and pursuing a NABERSNZ certification.
3. Cost savings and operational efficiencies.
Owner-occupiers of commercial real estate can enjoy all the same benefits as described for tenants above. A higher-rated building is more efficient, lowering operational expenses and freeing up capital for projects elsewhere.
However, this is only part of the benefit of NABERSNZ to owners. Because NABERSNZ ratings must be updated every year to remain valid, any building that invests in this green building rating will naturally be encouraged to regularly review, update, and improve performance to enhance efficiency. Continuous commissioning results in continuous improvements, which then translate into improved NABERSNZ ratings.
By continually improving your building's efficiency, you are not only maintaining your NABERSNZ rating but also minimizing your operational costs.
Navigating the NABERSNZ assessment and certification process.
Obtaining a NABERSNZ rating for your property may seem daunting, but the process is manageable with the right guidance. Here are some steps to help you get started:
- Familiarise yourself with the NABERSNZ rating system and determine which rating areas are most relevant to your property.
- Consult with a NABERSNZ accredited assessor who can guide you through the assessment process and help identify areas for improvement.
- Implement the recommended efficiency measures and ensure that all building systems are operating optimally.
- Schedule the assessment with your accredited assessor, who will collect the necessary data and calculate your building's rating.
- Receive your NABERSNZ rating and certificate, and promote it to prospective tenants and stakeholders.
For more information, read our dedicated guide to choosing a NABERSNZ assessor.
To ensure a smooth assessment process and maximize your building's rating, it's essential to work closely with your accredited assessor. They can provide invaluable insights and support in identifying the most effective strategies for improving your building's performance.
In addition, continuous improvement is a vital aspect of NABERSNZ certification. By regularly monitoring your building's performance and implementing efficiency measures, you can maintain or improve your rating over time. This not only helps you stay competitive in the market but also contributes to long-term cost savings and operational efficiencies.
The compelling ROI of NABERSNZ for property managers.
The holistic value of NABERSNZ for property managers is undeniable. A higher NABERSNZ rating can:
- improve tenant demand,
- open opportunities to secure Government tenancies,
- increase property value, and
- reduce operational costs.
Moreover, it positions your property as a leader in sustainable building practices and helps you meet the growing demand for energy-efficient properties from owners, investors, tenants, legislators and customers.
Embracing NABERSNZ certification and investing in sustainable improvements can provide a significant competitive advantage in the property market. By doing so, you are not only future-proofing your investment but also contributing to a greener, more sustainable future for all.
We encourage property managers to explore NABERSNZ further and consider how this comprehensive rating system can improve their building's performance and, ultimately, its return on investment. By taking this important step, you can make a tangible difference in the fight against climate change and ensure the long-term success of your property.
NABERSNZ is just one of the green building ratings available to New Zealand property managers. Green Star is another popular equivalent. Want to learn more about the difference between the two and which is right for you? Download our free guide.