How Can You Ensure Competitive Advantages for Grade A Offices?

Savills Market Brief Q4/2023 highlights that by 2026, more than 389,770 sq m from 15 projects are expected. Grade A developments will have an 86% share. The extensive project pipeline until 2026 is likely to pressure rents, especially in Grade A projects.

Additionally, factors like environmental safety and green spaces are top criteria for tenants when selecting offices. In Viet Nam, listed companies must adhere to regulations related to ESG objectives and many international companies must comply with certain international regulations, Therefore, many prefer buildings that meet environmental standards.

• “E” refers to how a property impacts the environment.
• "S" examines social responsibility through community engagement, occupant wellbeing and inclusion.
• "G" evaluates corporate governance, assessing leadership, transparency, and ethical decision-making.

If buildings fail to adapt to ESG, they will gradually become less competitive and will struggle to retain long-term tenants, especially when competing with environmentally friendly projects in the same segment. According to Savills 2023 ESG Report, in Viet Nam, there were 20 office buildings certified with LEED (Leadership in Energy and Environmental Design) or Green Mark for Energy and Environment Design.

Read more:

• What is the Significance of ESG in Real Estate?

From an operational perspective, Savills focuses on pre-operational consultancy packages to provide early recommendations for developers. Savills help stakeholders to develop sustainable projects that meet tenant demands while optimising future operational costs. 

PROJECTS UNDER CONSTRUCTION 

Consultancy on design, installation, and operation of technical systems to optimise costs 

An inadequately standardised technical system during the design and construction phases will result in increased repair costs, high energy consumption, and operational issues for both developers and management teams. Issues arise when: 

• The selection and installation of M&E systems do not meet maintenance requirements.
• The design does not meet green building certification standards.
• The system quality does not support technology integration.
• The separation of technical systems does not align with their intended functions.

As a property management agent, Savills advises developers on designing and installing various technical systems such as electrical, air conditioning, ventilation, fire protection, power supply, water pump, wastewater treatment, and lighting. This will ensure stable building operations, lower maintenance, and repair expenses, and reduce electricity consumption costs.

Energy-efficient equipment and systems

In addition to design and installation, selecting energy-efficient equipment and systems is crucial for sustainable operations and cost optimisation. Research conducted by the Vietnam Energy Efficiency Network (EEN) in 2022 suggests that actively applying energy-saving solutions during the design phase can reduce up to 50% of energy consumption during operations. 

Savills experts evaluate project design and technical systems to advise developers, empowering them to select energy-efficient equipment, allocate motion sensors, transition to energy-saving lighting modes, select environmentally friendly options, and implement smart temperature management systems.

Read more: 

• Energy-Saving Solutions for Buildings – Part 1
• Energy-Saving Solutions for Buildings – Part 2 

Insulation and soundproofing

One of the key aspects evaluated for LEED certification is the quality of the building’s indoor environmental spaces. Research conducted by KISR indicates that insulation layers can significantly reduce a building’s energy consumption for heating and cooling systems. Similarly, soundproofing minimises a building’s noise pollution, ensuring a satisfactory experience for tenants.

Developers can use organic or synthetic insulation materials and soundproof or double-glazed windows. Additionally, implementing insulation and soundproofing ceilings can leave a gap between the original and gypsum ceilings, thereby effectively limiting sound transmission through the building's structure.

Furthermore, developers can opt for heat-reflective or insulation paint to enhance energy efficiency. Heat-reflective paint can be applied to external surfaces, including building facades and tanks, to mitigate the urban heat island effect. Similarly, insulation paint helps to prevent heat loss, thereby optimising energy usage.

With our experience in managing diverse properties, we know that after handover, fixing operational issues can be costly. Therefore, developers must evaluate the building's design and technical systems during the construction phase to minimise potential issues and additional expenses, while also implementing sustainable solutions.

As projects moves to the operational phase, monthly assessments of technical systems becomes essential.

Explore Savills technical consultancy packages here.

OPERATIONAL PROJECTS

In Viet Nam, many office buildings are 10 or even -20 years old. Their management systems and operational methods often do not meet the green standards tenants are looking for. Savills works with developers to create renovation plans, which help existing projects improve their quality and competitiveness. 

Renovation and upgrade plans

In Viet Nam, many mixed-use projects have outdated technical systems designed with a one-size-fits-all approach, serving both office, commercial, and residential spaces. This results in energy inefficiency due to differing energy requirements across these diverse areas.

It is crucial to separate technical systems for mixed-use projects to enhance tenant experience and ensure transparency. 

Sustainable operations

Creating a well-structured maintenance plan is crucial for developers to manage costs effectively and uphold  project quality. To achieve this, both developers and management teams must have a clear understandings of legal regulations and project specifics.

Optimising the performance of technical systems through regular assessment is recommended. Given that mechanical and electrical systems consume the most energy in a building, adjusting parameters based on real-time needs and environmental factors can significantly enhance energy efficiency.

Regular assessments of technical systems are also vital for maintaining and enhancing building operational quality. By conducting routine assessments and evaluations, issues related to system efficiency, safety, and energy consumption can be promptly identified and addressed. This proactive approach not only optimises system operations but also reduces maintenance costs, enhances performance, and promotes energy savings.

Besides management services, Savills provides consultancy packages to support developers throughout the project lifecycle. Contact Savills experts for bespoke solutions to ensure operational efficiency and long-term value, and optimise costs for your project.