With corporate net-zero carbon (NZC) targets looming, top cities in Asia Pacific are bound to grapple with a growing challenge: the impending demand-supply gap for NZC-ready office space — or all-electric, highly rated, energy-efficient buildings powered by renewable energy.
Leasing office space in green-certified office buildings is becoming a non-negotiable for occupiers, but there is very little correlation between these certifications and a building’s energy performance.
Retrofitting to net zero
Currently, none of the cities in Asia Pacific including Singapore and Melbourne, the two highest-ranked cities after Sydney, are equipped with an adequate supply of NZC-ready office spaces.
The same trend is playing out in other regions. Major U.S. markets face a similar supply deficit of 75%, or 57 million square feet, by 2030, JLL data shows.
To address this issue, the region must accelerate the rate of retrofitting to meet future regulations and keep up with the growing demand.
The good news is that the retrofitting potential is substantial in Asia Pacific, with over half a billion square feet of Grade A office space in the region built before 2011, according to JLL.
The catalyst for a net-zero future
In some cities, governments have already been playing a crucial role in addressing the supply-demand gap for NZC-ready office spaces.
In the absence of sufficient NZC-ready buildings, proactive government support will determine how quickly cities can achieve their net-zero built environment goals.