Assess, retrofit, upgrade: curbing emissions in Australian commercial real-estate

To support ambitious net-zero by 2050 targets new research seeks to validate Australian use of an EU-developed tool to analyse greenhouse gas emissions from commercial real estate.

Enacted in 2010, the Australian Government’s Commercial Building Disclosure Program (CBDP) mandates the declaration of energy efficiency for all existing commercial buildings available for sale or rent in Australia. The program focuses solely on past emissions over a 12-month period, however, and its ratings often underestimate emissions due to a lack of whole building assessment.

In contrast, the Carbon Risk Real Estate Monitor (CRREM) tool developed by a European alliance of academic partners provides a forward-looking approach that considers the future emissions profile of existing buildings.

The CRREM tool, which was born out of a European Union Horizon 2020 funded initiative, originally focused on the EU and the United Kingdom but has since expanded its scope to include the Asia Pacific and the Americas. Notably, this tool has recently entered the Australian market, presenting an opportunity to test its efficacy in a new context.

Associate Professor Georgia Warren-Myers, Professor Robert Crawford, Dr Christopher Jensen and Dr James Helal from the Faculty of Architecture, Building and Planning have explored the potential of CRREM as an innovative tool for industry and the nuances for its application in the Australian context.

Their paper, “Validation of the CRREM tool for Australian office buildings,” which was presented at the 30th Annual Pacific Rim Real Estate Society Conference aims to bridge the gap by applying the CRREM tool to a series of Australian commercial property case studies.

The context

The global imperative to combat climate change has intensified, casting a spotlight on the built environment as a significant contributor to greenhouse gas (GHG) emissions. The building sector, accounting for 37 per cent of global GHG emissions, faces a pressing need for decarbonisation to align with global climate goals.

Australia – grappling with one of the highest per capita GHG emission rates in the world – has committed to achieving net-zero emissions by 2050. The International Energy Agency (IEA) emphasises the role of enhancing the National Construction Code, which relates to the design of buildings, and addressing environmental performance in the building sector to meet these ambitious targets.

In this context, the researchers say the Carbon Risk Real Estate Monitor (CRREM) emerges as a pivotal tool designed to assist building owners in navigating the complexities of emissions management and fostering sustainable financial investments.

“The tool facilitates a holistic assessment of the emissions profile, aiding property owners in identifying opportunities for retrofits and upgrades to ensure compliance with emission targets,” they say.

Conducting the research

In the study, three versions of the CRREM tool were employed to assess a portfolio of buildings across Australia. The purpose of considering multiple versions was to underscore how updates may impact results.

To conduct the assessment a portfolio of 70 office buildings was selected from three distinct asset owners, located in New South Wales, Victoria, Queensland, Northern Territory and Western Australia.

“The findings indicate that CRREM offers valuable insights into the future risk of portfolios, emphasising the importance of more detailed analysis, and highlight the need for understanding how inputs like state or territory emission factors impact individual buildings and portfolios,” the researchers say.

To date, the team has given feedback to the developers of the CRREM tool, leading to some initial adjustments. Additionally, they have collaborated with the City of Melbourne, using the CRREM tool to analyse their own portfolio of buildings.

Next steps

As CRREM gains traction in Australia, ongoing research into the tool's relationship with the National Australian Built Environment Rating System (NABERS) and the inclusion of sensitivity analysis in result interpretation are essential. This study established a foundation for understanding CRREM's usability in Australia and paved the way for further exploration and refinement of the tool in the evolving realm of climate-conscious real estate management.