1. Evidence from Australia and New Zealand Georgia Warren-Myers Dr Richard Reed

2. Introduction Background Sustainability and Rating Tools Role of Valuation Methodology and Results Measurement of Sustainability Market Value and Industry Rating Tools Conclusions and Further Research

3. Background Need to identify the relationship between sustainability and value Australian and New Zealand Investors and Sustainability Lack of Evidence Valuers have a pivotal role

4. Sustainability & Rating Tools Sustainable buildings are not a ‘kit home’ What is sustainability? Industry Environmental Rating Tools NABERS Green Star Potential issues What constitutes sustainable?

5. Role of Valuation Impact of Sustainability on Value? ‘Market Value’ 5 Approaches of Determination – however commercial property use DCF and Capitalisation of Income approaches A ‘sustainable’ office building is not a ‘new’ form of property - it still maintains the primary purpose of a commercial building Issues for Valuers

6. Methodology & Results Part of a larger study Objective Australian and New Zealand fieldwork Investors 9 semi-structured questions Interview Valuers Questionnaire 16 questions 2007-2008

7. Measurement of Sustainability Investor and Valuer opposing opinions! Also slightly different perceptions between NZ and Australia Investors value performance Valuers want a rating New Zealanders want both!

8. Investor Perceptions on the distribution of preference for Design Ratings or Building Performance

9. Valuers’ Preference

10. Market Value and Industry Rating Tools Valuers understanding and knowledge of rating tools Australia ahead of NZ – result of industry awareness and tool development Uncertainty of the impact of rating tools– lack of evidence and research Varying opinions on which tool has the most beneficial impact on value

11. Impact of Rating Tools on value

12. Industry rating tools & value

13. Conclusions & Further Research Confusion and lack of knowledge Inability to compare all building upon a single rating system – both performance & holistic If Valuers reflect the investor market – when the two are placing value on two different elements – how can value be quantified? For the ‘value of sustainability’ to be identified more work needs to be undertaken to be able to identify, quantify and measure the level of sustainability across ALL buildings - New and Existing buildings!!!!!! Then the value connection can be examined.

14. Thank You Questions? Contact Details: Georgia Warren-Myers g.warrenmyers@unimelb.edu.au Dr Richard Reed r.reed@deakin.edu.au