A new eBook is set to propel the retrofitting industry in Australia forward by raising awareness about an area of green building and sustainable construction finance that is not well understood, its publishers say.
Sustainable property industry online news and information service The Fifth Estate says its new eBook outlines the enormous potential of Environmental Upgrade Agreements (EUAs), a finance mechanism which it says will unlock ‘billions of dollars’ required to upgrade ‘aging and unsustainable’ existing building stock throughout the country.
Fifth Estate managing editor Tina Perinotto says EUAs are not well understood, and that the eBook provides the industry with solutions to their concerns over the mechanism while outlining the potential of this mechanism ‘at a time when half of Australia’s B and C grade buildings are nearing 20 years of age and are well past their “use-by” date.’
“The problem to date has been a cautious Australian property industry, which likes to proceed on solid ground,” Perinotto says. “New ideas are turned over and examined in every possible light, and this mechanism has been thrown every curly ‘what if’ question that can be mustered. This eBook provides the industry with solutions to their concerns and will hopefully kick-start them into action.”
Introduced in New South Wales and Victoria in 2010 and aimed primarily at commercial, industrial, strata scheme and large multi-unit residential buildings, EUAs are a type of agreement whereby a bank or financial institution lends funds to a building owner for water, energy and other environmental upgrades. The money is then repaid by to the bank by the council and is reclaimed from the building owner through a local council charge on the land.
The involvement of the local council in this way provides greater certainty and lower risk for the bank, and thus attracts a lower rate of interest for the building owner (whose tenant gets the benefit of reduced energy bills) than would otherwise be the case under a normal loan.
The new guide outlines opportunities presented by EUAs and explains how to negotiate a win-win situation for all involved. In addition to exposing common stumbling blocks and barriers EUAs can help overcome, it covers issues such as the type of refurbishments that suit particular buildings, the finance and accounting profiles for potential deals and how to engage the various stakeholders to bring projects to fruition.