BNP Paribas Real Estate has identified a UK wide ‘top 10 list’ of highly desirable green places to live and work outside of the capital. The university city of Cambridge tops the list followed by Milton Keynes, Glasgow, Exeter, Bristol, Dundee, Reading, Leeds, Edinburgh and finally Newcastle completing the top 10.
The ranking has been generated through BNP Paribas Real Estate’s unique location analysis model, Next X, which draws on a series of environmental data to determine how well these locations perform against these criteria.
Next X looked at aspects such as supply of environmentally friendly office space, (BREEAM rated), in these locations as well as ultra-low emissions vehicle (ULEV) usage and access to electric vehicle charging stations. It also reviewed supply of cycle parking spaces at rail stations and air quality at these places across the UK.
Cambridge tops the list thanks to factors including boasting the highest level of bicycle parking available (over 220 spaces per 10,000 people) and a three-fold increase in use of ULEVs in the past four years. When it comes to four-wheeled transport, Milton Keynes services electric car users well, with over 34 EV charging points per 100,000 people (against the top twenty average of 10.6), while Exeter has seen the highest growth in the use of ULEVs in the past four years at over 800%. Outside London, the number of BREEAM-rated office buildings is highest in Manchester, followed by Glasgow, Newcastle and Birmingham.
Growing evidence, in the UK and further afield, suggests that sustainable offices are retaining both higher rental and investment values. Locations with strong supply of certified green offices are therefore more likely to attract both businesses, talent and investment.
Over 50% of European respondents in RICS Q3 2020: Global Commercial Property Monitor survey believed that occupier demand for buildings with Green Building Certifications has risen in the past year and over 60% believed that investor demand for sustainable buildings had increased during the same period. 40% respondents also thought that green buildings would receive a rent premium compared to non-certified buildings.
A survey featured in KPMG’s, report “Real Estate in the New Reality” found that 83% of real estate professionals believed that COVID-19 will generate a significant increase in tenants’ demand for sustainable and environmental-friendly buildings. It also found that 85% either were planning to change their portfolio strategy to focus more on sustainable investments or were already focused on ESG as a criteria.
Stephen Wolfe, Head of Commercial, BNP Paribas Real Estate said:
“ESG and the return to the office are the most talked about topics right now, and both are very much interlinked. COVID-19 has made senior business leaders think carefully about the purpose of the office and how it is used. Going forward, the office certainly has a place in supporting business’ success yet it needs to offer much more than desks. The focus will be on creative working environments that offer a reason to come together and collaborate in person. This is why locations with a strong offer of quality sustainable offices with great facilities are attracting both businesses and talent.”
Jonathan Hale, ESG and Sustainability Director at BNP Paribas Real Estate said:
“In addition to both the ‘activity’ and ‘inactivity’ brought on by the commencement of a global pandemic just over a year ago, we have witnessed the accelerated action on Climate Change, an ESG boom and a clear global convergence on Net Zero. As the return to office gathers momentum and in the year of COP26 in Glasgow, it is worth noting the fundamental visible shift across the nation towards business’ focus on sustainable investment opportunities and how ESG is front and centre of informed decision making within the real estate sector.
Landlords and occupiers are beginning to align to the line of thought that a sustainable office building is no longer just a ‘nice to have’; instead the green premium is evermore becoming a reality as green buildings certified to industry standards (which include BREEAM In-Use, LEED, Fitwel, Well and RESET) are seen as a safer, resilient and more attractive option. With certified green buildings being subject to both stringent and tangible sustainable assessment criteria, their advantages can often lead to reduced maintenance, reduced environmental impact, increased occupier comfort and higher returns per sq ft office space.
Certified green buildings are also more appealing to occupiers that increasingly want to ensure that their workplace strategy aligns with their brand values. Given ESG is top of the agenda for most businesses, occupiers want to make sure that the buildings from which they operate support their corporate ambition.
Sustainable buildings also support a healthier working environment. From the many facets which determine a certified green building, better air-quality is often central to most external assessment criteria. With businesses planning for the return to the office as restrictions ease, the importance of maintaining a safe working environment and reducing spread of COVID-19 and new variants has never been more important. Looking ahead, locations that can offer a healthy supply of green, sustainable workspace will no doubt have a strong competitive advantage in securing business and talent over the short medium and long term.”
Gary Cameron, Head of Scotland, BNP Paribas Real Estate said:
“It’s really encouraging to see Glasgow doing so well, but not a surprise in my view. The city has been positively transforming itself from its industrial heritage and perceived ‘gritty’ image into a modern cosmopolitan city.
The legacy of the 2014 Commonwealth Games and the major City Deal commitments are now supporting some of Scotland’s largest regeneration projects, transforming large parts of what was previously considered undesirable areas.
As Glasgow prepares to welcome COP26, it is positive to see that the city council continues to be on the front foot when it comes to tackling aspects like air pollution. The city low emission zone, which will ban polluting vehicles entering the city centre from 2023, is well ahead of most regions.
Along with access to talent and cost competitiveness, ESG is now dominating corporate occupier focus when looking for their next workspace and Glasgow can deliver on all fronts. In contrast to some competing constrained cities, the regeneration and availability of sites in Glasgow is allowing occupiers to deliver best in class new green spaces for its workforce. Evidenced very clearly by the commitment from Barclays, JP Morgan, Virgin Money and Morgan Stanley committing to over 1 million sq ft of new best in class workspace.
Glasgow has continually ranked high on commercial, leisure and retail offerings. The next challenge is to deliver city centre living markets to match, which will help to consolidate Glasgow as a great place to both work and live. Being a greener city can only help with this.”
Josh Gunn, Head of the Bristol Office and Industrial & Logistics South West at BNP Paribas Real Estate said:
“Bristol has so much going for it so I am not surprised to see it ranked as a highly desirable green place to live and work.
It’s a really vibrant, multi-cultural city offering lovely surrounding towns and villages, attractive to professionals looking to re-locate outside of London. The pandemic has made families and professionals reconsider their lifestyle and many are seeking outdoor space and larger living accommodation to adapt to a hybrid working model. Bristol offers more affordable homes within easy reach of the capital, with direct links to London Paddington.
The city has done well in attracting innovative businesses and talent, which is also a result of two well established universities. I think the city has all the right ingredients to continue to grow and offer a highly attractive place to live and work.”