Perspectives podcast: How sustainability drives real estate transformation

This episode, live from the Green Building Council Australia TRANSFORM 2025 event, explores how building owners and investors can optimise existing assets for a sustainable future. Hear from JLL's panel of experts Julian Sutherland, Head of Sustainable Assets, Alana Hannaford, Head of Project and Development Services Advisory Australia and Leo O'Regan, Director and Investor Sector Lead for New South Wales, moderated by Jamie Wallis, Senior Manager, Green Buildings Council of Australia, as they dive into effective strategies for building retrofits, market trends, and lessons from global markets.

"I love existing buildings," says Julian Sutherland, Head of Sustainable Assets in JLL's APAC region. "They're fantastically exciting projects. It's actually more challenging to get an existing building up to spec than it is to build a shiny new one."

The sustainability advantage is clear: retrofitting produces approximately 200-300 kilograms of carbon per square meter, while new construction generates around 1,200 kilograms – a fourfold increase in emissions.

Building repositioning falls into two categories: minor updates focused on tenant attraction through facility improvements, and major transformations that reimagine how buildings connect with their surroundings while meeting modern sustainability standards.

A 2022 report revealed that in Sydney alone, over 450,000 square meters of occupied space doesn't meet tenants' net zero ambitions.

"When I engage with tenants, sustainability is first and foremost on the agenda," notes Alana Hannaford, Head of Project and Development Services Advisory Australia at JLL. "Seven out of 10 people aged 21-30 want to work for a sustainability leader."

This generational shift is reshaping workplace expectations, with younger professionals significantly influencing employers' real estate decisions.

Leo O'Regan, Director and Investor Sector Lead for New South Wales at JLL, identifies two key factors influencing investment decisions:

"More sustainable buildings attract tenants with better covenants," O'Regan explains. Recent reports show premium grade assets in Sydney have vacancy rates around 10%, compared to 17% for the broader market.

Additionally, "Investors are saying, 'We're not giving you the money unless you show you're being responsible,'" placing landlords between investor requirements and tenant demands.

The financial impact is clear: rental growth continues in higher-grade, sustainable buildings while remaining flat in secondary assets.

Successful building transformations require collaboration among all stakeholders – from designers and contractors to investors and tenants.

Early contractor involvement brings valuable innovations, while aligning sustainability goals with leasing agreements ensures green lease clauses don't become casualties of negotiation.

By embracing collaboration, innovative financing, and data-driven decision-making, building owners can transform existing assets into high-performing, sustainable spaces that deliver value for investors, attract premium tenants, and contribute to a better future.

Listen to the full episode here: https://www.youtube.com/watch?v=qdCtoTqM5ys