Commercial landlords can now access an innovative new way of financing energy and environmental upgrades of their buildings, with Building Upgrade Finance regulations taking effect from today.
Building Upgrade Finance makes it easier for property owners to upgrade their existing commercial buildings to improve their environmental impact. It will stimulate investment and jobs in South Australia, while also helping reduce emissions across the state.
Improving the energy efficiency of buildings in the City of Adelaide will help work towards Adelaide becoming the world’s first carbon neutral city.
In an Australian first, it also facilitates upgrades to heritage buildings.
Building Upgrade Finance is a voluntary way of financing for building owners, local councils and financiers. It is designed to tackle market barriers that can prevent commercial building upgrades going ahead. These barriers include access to the capital to fund upgrade projects, and the split incentive between landlords and tenants in leased buildings, where the building owner incurs the cost of the upgrade, but the tenant receives the benefits through reduced energy and/or water costs, and improved accommodation.
The mechanism allows for upgrades that improve energy and/or water efficiency, reduce emissions, or include renewable energy measures.
The mechanism is strongly supported by the Property Council of Australia (SA Division), with in-principle support from the Local Government Association of South Australia and councils including the City of Adelaide and Salisbury Council.
Quotes attributable to Climate Change Minister Ian Hunter
This scheme is a win-win for all involved. As well as helping improve our existing building stock, improve amenities for tenants and reduce emissions, Building Upgrade Finance will help stimulate jobs across the property sector.
This scheme – coupled with the Government’s buy local efforts – is sending market signals that I hope will see growth for local manufacturers and suppliers of clean technologies.
Adelaide has some wonderful heritage buildings and I’m proud that South Australia is the first jurisdiction in Australia where heritage building upgrades qualify for financing under this mechanism, enabling these buildings to not only remain beautiful but also become energy efficient, environmentally friendly and more utilised.
Quotes attributable to Property Council of Australia South Australian Executive Director Daniel Gannon
Building Upgrade Finance is an innovative way for owners to access finance to upgrade their assets.
Under this scheme, building owners will be able to improve the environmental performance of their buildings which reduces operating costs, increases yields and attracts tenants.
This scheme is a win-win for owners and tenants.