Sydney has been named the second most sustainably led city for real estate in the Asia Pacific region.
The NSW capital was just below Singapore in the Knight Frank Asia Pacific Sustainably Led Cities Index, which ranks 36 cities globally on urbanisation pressure, climate risk, carbon emissions and government initiatives.
Three Australian cities made the top five green-rated cities for commercial real estate; Sydney, Perth and Melbourne.
Wellington took third with Perth at fourth and Melbourne fifth.
The top five cities were all found to have low carbon emissions per person, green spaces and low urbanisation pressures.
The report also addressed the Asia Pacific region’s vulnerability to extreme weather, particularly cities on or near the equator.
Knight Frank’s Asia Pacific research head Christine Li said the index looked at what investors were looking for in sustainable buildings.
“The index is closely aligned to what investors are interested in when benchmarking their portfolio and individual buildings,” Li said.
“Liveable cities such as Sydney and Wellington boast ample green spaces that have been critical for inhabitants during prolonged lockdowns, providing a reprieve from highly urbanised lifestyles.”
In May 2020, the NSW government announced a $5-million initiative to increase Greater Sydney’s green canopy by planting new trees with Landcare NSW and Greening Australia.
Top 20 most sustainably led cities
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Source: Knight Frank's Rising Capital in Uncertain Times report
Knight Frank’s Global Capital Markets head Neil Brookes said investors and tenants wanted to see more sustainable buildings.
“Investors are placing more emphasis on strategies that maximise their returns from their ESG (environmental, social, and governance) efforts,” Brookes said.
“We have seen a swift uptake of ESG metrics benchmarking in the APAC region in recent years, motivated by the imminent need to curtail climate risks.
“Adopting sustainable measures not only enhances portfolio security but has been proven to add a positive price premium to assets.”