THE TENANTS & LANDLORDS GUIDE TO HAPPINESS

BEST PRACTICE AND GREEN LEASING

CHAPTER 8 KEEPING THE mAGIC ALIvE

PRINCIPAL AUTHOR LYNNE BLUNDELL

A COLLABORATION WITH THE BETTER BUILDINGS PARTNERSHIP

8CHAPTER EIGHT: Keeping the magic aliveBy Lynne Blundell

38Okay, so life is ticking along nicely and you’ve both settled into a routine, but somehow there’s something missing from the relationship. You just don’t seem to talk much. It’s all business as usual. So where’s the togetherness you both hoped for?

Sound familiar?

If you’re a tenant feeling like you just don’t have much of a connection with the landlord, let alone other tenants or the property manager – or you’re a building owner who finds it hard to connect with your tenants – you are certainly not alone.

Despite the best intentions, most building owners and tenants struggle to keep up regular communication that could enhance their efficient use of the building, improve wellbeing of employees and substantially cut their business costs.

A BIT Of ExPOSURE – IT’S A TRUST THING

Sharing information on energy and water use, or ideas about recycling and technology, can have a large impact on how tenants use their workspace, and on sustainable outcomes. And the same goes for building owners with the base building operation.

Finding a forum to do this is just the start. What really makes a difference is adopting a collaborative mindset involving shared information. Sometimes this requires a complete change of culture.

Pip Harley, CitySwitch Green Office program manager, says businesses can be reluctant to

share information such as energy use data with each other, but once the benefits of collaboration become apparent this barrier can quickly fall away.

Over the past 12 months CitySwitch, together with the Better Buildings Partnership, has run the Vertical Communities Initiative to encourage a collaborative approach within commercial buildings to achieve more sustainable outcomes, particularly on energy efficiency.

The first step is to initiate communication and trust between landlords and tenants so that information such as energy data can be shared and assessed.

Tenants consume up to 50 per cent of energy in commercial buildings, representing a significant opportunity for reductions. But industry observers say not enough has been done to target this sector.

The idea of the Vertical Communities Initiative is to encourage a more collaborative and targeted approach to energy savings across the building, both among tenants and between tenants and landlords.

“A vertical community is about using the collective power of the businesses that occupy a building to drive change,” Harley says.

“Participants not only learn from one another but are able to achieve economies of scale by engaging suppliers together rather than as siloed organisations. It takes some of the fear of the unknown out of the equation, and helps building occupants to get extra value from leveraging the expertise of their building owner.

“The first 12 months of the project has focused on getting buildings on board, signed up and agreeing to objectives,” Harley says.

“We then try to get a whole building energy picture for the building. The base building data is generally easy to get hold of but it is more complicated with tenants as they don’t always have sub-metering in place. In these instances we have collected the data manually and amalgamated it.”

“A vertical community is about using the collective power of the businesses that occupy a building to drive change”

— Pip Harley, CitySwitch

Four buildings are participating in the project, all owned by BBP members. Some have a building management committee in place and where there

isn’t one the project team will try to establish one.

Each building has set three key sustainability objectives for the next year. Energy use must be one of the objectives but the other two are chosen by the tenants in each building, and range from waste and recycling to transport, technology and social collaboration.

Examples that some tenants have nominated include mobile phone recycling and recycling of office clothes, which might be donated to Dress for Success, a business that provides office clothes at an affordable price.

“We are focused on energy efficiency but are happy to support other objectives such as waste reduction,” Harley says. “These are often the things people get excited about because they are more tangible than energy – they really help establish the community and often kickstart the momentum needed to tackle some of the weightier sustainability issues in the building.”

VERTICAL COmmUNITIES – THE LINES Of COmmUNICATION ARE OPENBeck Dawson, Investa’s general manager corporate sustainability and chair of the BBP tenant engagement technical working group, has been running one of the four Vertical Communities projects at Deutsche Bank Place in Sydney. There are 16 tenants in the building and the key focus is to get them talking to each other as well as to the landlord and sharing ideas about how to improve the building’s performance.

“We invited all tenants to a workshop and asked them what they wanted from a performance perspective. We got 33 great ideas out of the workshop and we have chosen a few of these as a group, which we’ll give a concerted push to,” Dawson says.

Achievements so far include:

• LED lighting upgrade in all common areas as well as in a substantial percentage of the tenancy space – 70 per cent of the total building

• best practice leases adopted by more than half the tenants

• 40 per cent of the building is undergoing NABERS Energy tenancy ratings

• 40 per cent of the building is occupied by CitySwitch signatories

As a result of the lighting changes, which involved updating 1700 lights from CFL and halogen to LED, tenants and the building owner are expected to share a saving of 392,000 kilowatt-hours and $80,000 a year. Payback time will be around nine months.

Beck Dawson

“For us this has been a considerable change,” Dawson says. “It is a work in progress and has taken a lot of time because it is about cultural change.

“The second step after asking tenants what their priorities were was to get people to share information. We had a second workshop on that.”

Informal energy audits were also conducted to set a baseline from which to work. A major difficulty is finding a central way of sharing data and the Vertical Communities Initiative team is looking at ways to do this. Another is finding a way to make collaboration the norm in commercial buildings.

“In the long run if 50 per cent of energy use is coming from tenants

there are a lot of savings to be made,” Dawson says.

According to Pip Harley, the potential of the CitySwitch Vertical Communities project is to broaden the scope of collaboration.

“We can talk with tenants not only about the community they are contributing to within this one building but also the contribution they can make to the city’s goals. This makes it more real for everyone involved, which eventually normalises it and opens the door to a more collaborative lease framework,” Harley says.

CitySwitch provides a toolkit for staff engagement and detailed advice, tips and guidance on setting up and running a vertical community.

Deutsche Bank Place

Onsite separation of materials.

Deutsche Bank Place

GROW THE CIRCLE Of fRIENDS AND SUPPORTERS

But it takes more than collaboration between tenants and landlords to keep a building humming. It doesn’t matter how much data you collect and share, if the building operations team is not part of the collaborative process. You also need the fund manager on board, to understand the long term potential benefits for their investment.

According to Patrick Crittenden, director of management consultancy Sustainable Business, maintaining optimum daily building performance requires ongoing collaboration among building operations personnel, something that can be quite challenging.

This is the aim of a project Crittenden is running with the NSW Office of Environment and Heritage. When approached by OEH to set up a training program for building operations teams, Crittenden worked with GPT and JLL to develop a model that brought together various technicians with the owners and key tenants.

“We designed an intervention, or training program, which basically put the electrical engineers, mechanical engineers and facilities managers together for four two-hour sessions,” Crittenden says.

The workshops provided an opportunity for the building operations people to talk and to share information such as energy data, audit reports and complaints from tenants.

Asset and fund managers were also involved, something that is crucial for funding of sustainable initiatives. Too often there is a gap between audit reports and accessible information for the decision makers. Having stakeholders all in the one room, including those who make the financial decisions, is more likely to ensure actions are followed through.

“It is crucial to have people across the business involved right from the beginning of a project aimed at making a building more sustainable. Decision makers must be involved from the beginning in energy efficiency proposals. Success equals stakeholder analysis and engagement backed by data and evidence,” Crittenden says.

IT TAKES TImE

“I think we consistently underestimate how much it takes to build these relationships based on collaboration and trust. And it’s not something that can happen overnight – there’s no silver bullet.”

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“We consistently underestimate how much it takes to build these relationships based on collaboration and trust.”

— Patrick Crittenden

Image by Fiona Livy

To be successful, behavioural change needs to be backed up by trust, understanding and shared objectives.

“We’re talking about people and systems and structures that promote and encourage certain behaviour. Without shared objectives, without time to build trust and understanding that there are benefits in collaborating across professional and functional boundaries, it’s difficult to achieve optimum performance.”

Achieving this type of collaborative approach is also not something that’s never done and dusted. People change and organisations change so it is an ongoing process that requires ongoing attention and a range of approaches.

TRUST AND UNDERSTANDING – THE BENEfITS IN COLLABORATION

OEH worked with Government Property NSW to identify five buildings that could be brought up to 4.5-star NABERS Energy ratings. Workshops were then set up to include facilities managers, the building owners, tenant representatives and asset managers.

In one of the buildings, the McKell Building in Sydney, a business case was put together to upgrade the lighting in the stairwells.

After exploring the issues and opportunities the owner and asset manager were given the option of either replacing some or all of the lights. The owner opted to upgrade all the lights, despite some lack of clarity over whether the upgrade fell within maintenance or capital improvement.

The McKell Building

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KNOWLEDGE IS POWER

When it comes to waste, achieving more sustainable results doesn’t require complex solutions, waste consultant Robyn Pearson says. But even the simplest system will fail if companies don’t follow it up with an education and awareness campaign for those who are meant to use it.

“Most things to do with waste are fundamental and basic but human behaviour is not,” Pearson says. “The

mistake is to think you can put in a system and everyone will use it. Bin solutions need to be customised and you need flexibility.”

One way of sharing information and understanding among employees is for tenants to set up sustainability forums. This allows people to ask questions about how waste systems work including the co-mingled systems, where a variety of items such as plastic bottles, glass, aluminium and steel are collected in the same bin.

“If you give people information they become engaged and informed and educated. Then they become involved and active in the program and start to reduce their waste,” Pearson says.

“Once they think about the materials they start to change their behaviour. The transfer of knowledge can get amazing results.”

The results can be particularly significant with manufacturing companies that might generate consistent levels of waste. One printing company that Pearson worked with on waste systems saved thousands of dollars simply by ordering customised paper for specific jobs instead of using the same standard size for all jobs. This meant there was less wastage in offcuts.

“Initially the company thought they were doing a good thing because they were recycling nearly all their offcuts. But by adjusting the paper size they didn’t need to waste this amount of paper.”

Robyn Pearson

THE COST IS SmALL BUT PAYBACK CAN BE BIG

“Waste solutions are always simple,” Pearson says. “I’ve never yet seen a solution cost anything much – payback is usually within two months. It’s the awareness that makes the difference.”

Too often building management rolls out systems that don’t work because it hasn’t consulted the users. Clear signage and the Australian standard colour coding of the waste system is essential – red for general waste, yellow for co-mingled and blue for paper and cardboard.

Kitchen fitouts should also ensure it is easy for people to separate their waste. Too often kitchen areas are architect designed for aesthetics and placement of waste and recycling facilities are an afterthought. This increases the risk of waste contamination.

Bins should also be placed close to where the waste is generated and be easy to find, not camouflaged.

CULTURE CHANGE

At the same time, removing bins from under desks can be a strong driver to

behaviour change as people become very conscious of waste when they have to walk somewhere to put it in the bin, Crittenden says.

Swipe-to-print technology has also been credited with a reduction in paper use in offices because people take ownership of how many pages they choose to print.

But much can also be accomplished by building management.

“Building management also needs to be up to speed with the technology of recycling and packaging so they don’t make mistakes with the system they put in,” Pearson says.

“The key to success for an individual company is employee engagement.

“When it comes to a whole building approach, the building management needs to sell sustainability and waste management by applying a broad brush. Not all occupants have to have exactly the same objectives but they need to go down the same path.

“Building management needs to understand all outcomes of the system they are putting in place to be able to sell it to tenants. It’s all about education and communication.”

“The key to success for an individual company is employee engagement.”

— Robyn Pearson

HOW WESTPAC IS GOING GREENER AND CLEANING UP ITS ACT

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One major tenant, Westpac, has taken the initiative itself and is focusing on a collaborative approach with its landlord to improve its recycling and waste performance in a campaign that is being rolled out across the bank’s commercial offices.

As part of its 2017 sustainability strategy, Westpac has committed to remain carbon neutral and to reduce its environmental footprint by 2017. The company aims to reduce its energy consumption per square metre for retail and commercial sites by 10 per cent, make its data centres more efficient, reduce paper use by five per cent and increase its Sydney office recycling rates to 75 per cent.

GETTING THE KNOWLEDGE – WHAT WORKS, WHAT DOESN’T

In order to understand the issues so it could reach these targets, the bank ran a waste audit and five design thinking workshops.

An initial employee awareness survey revealed:

• 76 per cent strongly agreed or agreed that environmental sustainability was important to them

• 44 per cent strongly agreed or agreed that recycling is easy at work

• only 28 per cent knew where to access information on Westpac’s sustainability strategy

• 38 per cent knew how to reduce their environmental footprint at work

From the workshops Westpac discovered staff were confused by

the different recycling systems in each of its locations, due largely to different supplier agreements.

It also found that there was not enough engagement with individuals throughout the organisation regarding waste and recycling but that when given the opportunity staff wholeheartedly embraced the opportunity to talk about their concerns and suggestions.

Most staff were unaware of Westpac’s 2017 direct environmental footprint targets. They expressed a desire to do the right thing but didn’t know how. The company’s bin signage confused them and this was reflected in high rates of contamination in recycling bins and landfill.

At Westpac Place, at 275 Kent Street in Sydney, the company’s recycling facilities were contaminated with dirty paper hand towels, coffee cups and food scraps, while potentially recyclable materials were ending up in landfill.

As a result Westpac created the “We have the Will” campaign to connect the good intentions of its employees with simple ways to help them follow through with actions. This involved:

• an internal microsite for staff to find out about the 2017 direct environmental footprint targets

• a dashboard that will be updated each quarter so staff can see how the company is tracking

• creating a simple visual identity using icons to help staff understand and connect the business initiatives to the targets

Recycling is the company’s focus for 2014. In collaboration with its landlord, Mirvac, Westpac’s Group Operations, Property and Procurement division worked with key partner DTZ to launch a number of recycling initiatives at Westpac Place to coincide with World Environment Day on 5 June. These included:

• standardised bin signage across the Westpac Group

• bin upgrade at Westpac Place, including removal of old bins and installation of new ones

• installation of 384 new signs in Westpac Place

• removal of 6324 under-desk bins

To help kickstart individual actions, the company introduced the 21 Day Pledge, encouraging people to choose one thing to

help reduce their environmental impact. This resulted in 2500 people pledging to change their behaviour, including executives such as chief operating officer John Arthur.

Westpac group head of sustainability and community Siobhan Toohill says the program will make a big difference to Westpac’s recycling results.

“As one of Australia’s largest corporations with significant operations and around 36,000 employees, Westpac has a clear responsibility to reduce its direct environmental footprint,” Toohill says.

“The business benefits in reducing costs and driving greater efficiencies are well known. It is also what is expected by our people who look to work for a high performing company with a strong social purpose.”

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“These initiatives are designed to galvanise our people, helping them to connect personally to important environmental issues. It will make it easier for them to contribute.”

In the month prior to removing individual bins from under desks,

Westpac also asked employees to voluntarily hand their bins in. For every person who did this the company donated money to Indigenous training organisation Tribal Warriors.

Once the changes are embedded in its Sydney offices, the bank intends to roll them out across its other locations, a total of 4000 facilities, working with its property management partners and landlords to drive this action.

According to Paul Edwards, Mirvac’s group general manager sustainability and co-chair of the BBP, the campaign illustrates what can be achieved when landlord and tenant work together to improve the workplace.

This, says Edwards, recognises that “no one can do this alone, and through collaboration we can engage and empower our people to do more”.

“The business benefits in reducing costs and driving greater efficiencies are well known. It is also what is expected by our people who look to work for a high performing company with a strong social purpose.”

— Siobhan Toohill, Westpac

BBP member AMP Capital has introduced a collaborative model throughout its buildings to ramp up its building performance and engagement with tenants, including useful advice such as with design of fitout.

The model, Building Connections, involved 10 different nodes, including Environmental, Building Services, Technology, Social Events, Charity Support and Health & Fitness.

According to Dominic Ambriano, national sustainability manager, AMP Capital, the environmental node has really taken off.

“It is very much a collaborative exercise and a way for us to engage more effectively with tenants across all our buildings,” Ambriano says. “We set up

meetings to hear what tenants’ issues are and we also organise for consultants to come in and talk to tenants about anything from lighting to recycling.”

The company is in the process of evolving its landfill and bin infrastructure and so uses these meetings to communicate the changes and educate and engage with tenants. Other issues that sometimes arise at its meetings include tenants’ placement of equipment such as printers, which if they are placed under thermostats can make them respond to the hot air and apply more cooling. As the landlord, AMP Capital sees a responsibility for helping to improve the tenants’ comfort and use of the space.

Getting the fitout right the first time is also a valuable assistance.

“We help advise our tenants when they move in to help them maximise their fitout,” Ambriano says. “They spend a considerable amount and there is very little appetite to spend more throughout the lease. Getting it right at the beginning to ensure operational performance is important.”

fLOOR WARS – fUN AND SAVINGS

There were also some impressive results achieved in its own tenancy in Bridge Street, Sydney from a

AmP CAPITAL AmPS UP TENANT ENGAGEmENT

Dominic Ambriano

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campaign to reduce energy and increase recycling. Called “Floor Wars”, the campaign, launched in 2012, encouraged each floor of employees to compete to get the best results in energy use and recycling.

The result was an average 15 per cent energy saving, an increase in recycling to almost 70 per cent diversion of waste from landfill, a 20 per cent reduction in paper use and a four star NABERS Energy tenancy rating.

In 2013 the campaign was rolled out to other buildings occupied by AMP Capital. Other initiatives at its Bridge Street tenancy included installation of LED tubes, motion sensors in meeting rooms, organic waste collection and software for automatic PC shutdown. Subsequently the tenancy’s NABERS Energy tenancy rating increased to five stars and achieved carbon neutral operation.

• See AMP “Floor Wars” case study

Ambriano says AMP encourages tenants across its buildings to sign up for NABER Energy tenancy ratings. Other areas of its Building Connections program, such as technology and health and fitness, are also helping to enhance socially sustainable outcomes.

“With our technology node we are looking at how we can enhance tenant experience with things like

wifi, including free wifi in common areas such as building cafes so that people can have more flexibility where they work,” Ambriano says.

Health and fitness activities include redeveloping change rooms and fitness facilities in buildings so that they include extra items such as hairdryers, irons and secure bike facilities, all designed to encourage greater health and wellbeing of tenants.

fREE STAff ENGAGEmENT TOOLKITS

New toolkits developed by CitySwitch are available to download from the CitySwitch website to help organisations develop switch-off campaigns, competitions and green champion networks to engage staff in their efforts to improve energy, water and waste efficiency, and see real results.

THE TENANTS & LANDLORDS GUIDE TO HAPPINESS

ISSUE 08. AUGUST 2014

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