"Green" leases
Increasingly, both landlords and tenants aspire to demonstrate their ‘green’ credentials through the stewardship of property they own or occupy. Drivers for these aspirations include changes within the business environment, for example through developments in corporate social responsibility (CSR).
This is not a ‘flavour-of-the-month’ issue; a burgeoning statute book will also make all organisations have to improve their environmental performance over the coming years. Apart from trying to ensure that newly built properties are increasingly energy efficient, improvements in the performance of the existing stock are seen as vital to ensuring that legally binding energy use reduction targets are met.
In order to make the most significant changes to energy performance in buildings, both for regulatory and business-driven reasons, the ways in which occupiers use properties will need to change. Unfortunately, practical experience tells us that commercial leases often provide a barrier to improving environmental performance within the built environment, particularly in multi-tenanted buildings.
One way of achieving the environmental aspirations of both landlords and tenants is to enter into ‘green lease’ clauses, commitments from both landlords and tenants which confer rights and responsibilities which foster good environmental practice.
Examples of landlords’ obligations in this
- Meter the energy and water consumption of each tenant separately
- Provide certified evidence that all building elements and systems are installed and operated with maximum efficiency.
- Prohibit the use of CFCs in air conditioning systems
- Ensure dedicated recycling facilities are easily accessible
- Monitor and adjust air conditioning levels to reduce energy use
- Provide appropriate numbers of bicycle storage and changing rooms.
Tenants obligations might include those to:
- Monitor and ensure good levels of indoor air quality and ventilation efficiency
- Ensure the building fit-out uses recycled materials and those capable of being recycled
- Provide adequate access to natural daylight and views to building occupants.
It is vital for landlords and tenants to adopt co-operative approaches and to maintain co-ownership of intentions when considering the use of green lease clauses. Most important, however, is for measurable targets and benchmarks for environmental performance to be established at the outset and for environmental targets prescribed by a lease to be achievable with mutual benefits.
Clearly, all parties to such a lease should have well considered professional advice before entering into what might turn out to be well-intentioned but unrealistic obligations.
Please contact us for further information.
