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Melbourne sees a boost in retrofit activity, but private owners still not engaging

Thirty-seven per cent of buildings surveyed by the City of Melbourne have completed a retrofit in the past five years, according to the latest 1200 Buildings Melbourne Retrofit Survey. However, the report points to a continued lack of engagement from private owners.

The figures are up from 25 per cent when the survey was last completed in 2013. The survey, which was launched at the National Energy Efficiency Conference, also found 21 per cent of the 1465 buildings contacted were planning to retrofit in the next five years.

Eleven per cent of buildings were currently in the process of retrofitting, up from five per cent from 2013, which the report said pointed to a significant increase in retrofit activity over the past two years.

“Retrofitting is on the increase because improving a building’s performance makes economic sense,” City of Melbourne environment portfolio chair Arron Wood said.

“More efficient buildings cost less to run and are more likely to attract and retain tenants, which improves asset value and rental return.”

Mr Wood said there was a “clear business case” for retrofitting, which promised improved air quality, temperature quality, and staff attraction and retention.

“Staff that work in healthy and well-designed environments are more likely to be happy and productive employees,” he said.

The most popular reason to conduct retrofit was to replace a broken asset (37 per cent), while 33 per cent were motivated by cutting energy consumption, and 22 per cent to attract new tenants.

Lighting was by far the most popular retrofit activity, with 92 per cent of buildings having undergone a lighting upgrade, while 49 per cent involved a chiller upgrade and 20 per cent included an building management system upgrade. Other activity included boiler upgrades, insulation and window replacement.

Corporates lead, private owners lag

It was corporate owners leading the charge on building upgrades, with future intention to retrofit the highest (29 per cent). The sector with the lowest activity of building upgrades and the lowest intention to perform upgrades (15 per cent) was private owners, pointing to a crucial area for engagement.

As City of Melbourne senior sustainability officer – sustainable buildings Michelle Leembruggen told us last year: “Private owners often do not have the corporate structures and resources to research, facilitate and track building performance. They do not proactively manage building performance and want to see cash flowing into their businesses, not out.”

Corporate owners were also much more likely (68 per cent) to have a NABERS Energy rating compared with the entire sample (15 per cent), and were more likely (49 per cent) to have made changes to internal policies to enable upgrades than the general sample (20 per cent).

Self-funding was still the most popular way to go about retrofitting (83 per cent). Ten per cent accessed a loan, five per cent accessed a grant, while only one per cent of the sample used environmental upgrade finance. However, 30 per cent of survey respondents said they were “quite” or “very” interested to explore environmental upgrade finance, though just as many were “not at all interested”.

Most respondents (68 per cent) thought access to finance was no barrier, or only a minor barrier, while 25 per cent said it was a major or considerable barrier.

Interestingly, 20 per cent of those surveyed were “not at all willing” to consider solar panel, while only 13 per cent were “very willing”.

“There is still work to be done,” Mr Wood said. “We will keep motivating, educating and supporting building owners so they can reap the benefits of making deeper retrofits, particularly the owners of lower grade buildings.”

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