News from the front desk issue 422: Passive House as a methodology of construction is about to break out of its boutique box in residential and hit the broader market sectors.
It’s starting to catch the eye of institutional investors keen to diversify into a product that guarantees not just a green building, but a high quality green building whether that’s build to rent housing, aged care facilities, student housing, or high grade offices.
It makes sense.
This method of construction is designed by a building physics institute in Germany and so comes with one of the best manufacturing brands in the world (if we ignore the embarrassing Volkswagen scandal). What it does is deliver buildings that, let’s face it, are the way they should all be built: high quality structures that maximise thermal, acoustic and health outcomes at minimal energy consumption.
That alone is impressive.
When you think about it, it’s hard to justify anything less. And the investors can see the value.
Chris Nunn (AMP Capital) is chair of the Australian Passive House Association and this week he is moderating a panel session PH South Pacific conference at Victoria University in Wellington, New Zealand, on the growing investor interest in “deep green” assets.
Some are impact investors but institutional investors also want to diversify.
“There’s been a lot of talk about what the build to rent sector could look like,” he says. One big investor in Vancouver has written PH into its requirements.
Nunn is clearly a convert. He’s in the process of building a PH house for his family, putting his money where his mouth is.
PH gets you to a near net zero energy and then “just a few solar panels on the roof” can get you the rest of the way to net zero carbon, he says.
Sure, you can get net zero carbon in very poor quality buildings, but consider this: you need to close up all the windows and doors to keep the place cool or warm. No fresh air. And didn’t you sign up for fresh air when you ticked off the comfort features you needed?
Our urban democracy is broken
Mike Brown likes to throw a few intellectual grenades from time to time but his piece this week on our increasingly failing democracy and institutions is nothing short of sublime.
Structural weaknesses have grown to threaten formerly stable political parties, he says. They’re “increasingly corroded by us-versus-them populism, hate-framed nationalist resentment, and a medieval disdain for evidence, some have dissolved into fetid swamps of arrogant stupidity, up from which deranged buffoons now bubble up to be leaders.
“Stupidity and mendacity are new virtues; truth is falsehood; solipsistic belief reigns over disinterested verifiability; lobotomised strong-men dominate. No wonder democracy is in retreat.”
His piece is a wake up call at a time when the daily news is more often than not a shock and the danger is we go numb to yet another outrage.
The built environment emerges as an election favourite
As election fever hots up we watch the built environment become the punching bag of choice. It will be a lightning rod for all the ills of the world: overdevelopment and population growth, maybe or maybe not code for xenophobia; who’s ever going to admit to racist undertones when you can point to earnest concern for environmental degradation and when not so long ago a lot of greenies called for a cap on population. Trouble with this cohort is they don’t suggest what the answers are; they acknowledge it’s a global issue and that climate change will create millions of refugees, then go incoherent behind some mutterings about the failure of infrastructure to keep up (and when has infrastructure ever kept up?).
Underneath it all, the kind view is that this population concern is something to do with the sadness of things past.
Could the climate change message be sinking in?
Increasingly the message starting to seep through that the built environment is where we create most climate destroying emissions and where we bear the brunt of an angry Earth. People are getting the nexus.
To add immediacy to the problem it’s looking like the homes many of us are living in or have just bought or rented won’t be sufficient protection from the extremes of weather clearly on their way.
There are more threats to property/real estate.
One may come from the Reserve Bank of Australia.
Last year it got it badly wrong when it waded into zoning and housing affordability issues.
Now it’s got its hands full again, wondering if it should risk re-igniting the housing prices by lowering interest rates.
Right now though there is something more threatening to the housing market than the Reserve Bank.
It’s the risk of eroding confidence in the housing market, especially high rise apartments, that builders and developers have brought on – all by themselves.
With no help from the Reserve in raising interest rates, no help from the banks in lending too much and, no help from the millennials, who refused to further pump up the market and, preferring instead to rent (who’s laughing now, landlords?).
Nope, the trail of self-inflicted damage is starting to tumble out of the high rise apartments with a growing list of problems, from fire to poor and dangerous construction, depriving people of homes and investments.
Even worse are the buildings not yet pinged. Who knows where the next “Kinder Surprise” will come from? In Victoria they keep the list of buildings with flammable cladding secrets lest firebugs get the wrong idea, we’re told. Nonsense. It’s to protect values and confidence and we know how fragile confidence is.
No royal commission needed to expose this media shy sector; it’s doing it all on its own.