Green building regulations are becoming more strict with building owners and even tenants facing potentially massive fines if their office space does not meet environmental standards when leased or sold.

The commercial building disclosure program becomes fully operational from November 1. Under the program, a building energy efficiency certificate will be needed if more than 2000 square metres of office space is sold, leased or sub-leased. This applies to building owners and also tenants who sub-let the space.

Failure to comply may result in fines up to $110,000 for the first day of non-compliance and up to $11,000 for each extra day.

A BEEC (Building Energy Efficiency Certificate)  includes:

• A National Australian Built Environment Rating System energy star rating for the building.
• An assessment of tenancy lighting in the area that is being sold or leased.
• General energy efficiency guidance.

Minter Ellison partner Peter George warned that landlords faced impediments under the plan. ”The works will be capital in nature. They will not normally be able to be passed on to the tenant but the tenant will reap the benefit in lower energy costs,” he said.

The consent of existing tenants was required because the work often entailed some disruption. ”Ideally the work should be carried out when the property is not tenanted, but in a multi-tenanted building, the lease terms are very unlikely to line up,” he said.

”Even if the work is done, the tenant’s fit out and general practices can have a big impact on the environmental credentials of the building.”

(Source: www.smh.com.au)