Analysis of 2,000 buildings across five global cities shows environmental accreditation drives higher rents even after controlling for location, age and grade.
Office buildings with high environmental accreditation command rent premiums of up to 23% over non-certified properties, according to a Savills study of more than 2,000 offices across five global cities. The analysis covered Amsterdam, London, New York, Chicago and Hong Kong.
Savills used hedonic rental models for each city that controlled for factors including office grade, building age, proximity to major transport links and floorplate size. The models isolated the rental premium associated with environmental building accreditation independently of other characteristics that influence pricing.
Hong Kong showed the largest premium at 23%, while Amsterdam Zuid offices commanded 18% higher rents. London City offices with strong credentials achieved an 11% premium. New York Midtown offices showed a 7% premium and Chicago offices a 6% premium.
The size of the premium varies significantly between markets, reflecting differences in local supply and demand dynamics, regulation and the broader policy environment in each location, Savills said. Sarah Brooks, associate director in Savills World Research, said the findings show the market continues to place a measurable value on more sustainable buildings even when controlling for other factors.
Savills valuation experts noted that sustainability is one of several drivers of market performance alongside location, building quality, flexibility, accessibility and occupier experience. Impact is likely to vary by market segment and asset quality. Sustainability increasingly functions as a hygiene factor at the prime end of the market rather than a source of unlimited rental outperformance, the firm said.
In the City of London, offices with BREEAM Excellent certification achieve a rental premium of around 10%, while BREEAM Outstanding offices command around 18% above BREEAM Excellent alongside longer lease terms, the study found. BREEAM Excellent is in many cases a policy requirement in the City, while BREEAM Outstanding represents a voluntary commitment to best practice.
Georgios Askounis, director at Savills Earth, said it is encouraging to see office rental markets worldwide recognising the value of sustainable building certifications and paying a premium for them. Certification is not an end in itself, but the premiums recognise its value as an independently verified framework for delivering efficient, low carbon, climate resilient and healthier spaces, he said.
The Deployment Angle
Family Office Real Estate Daily Desk · our analysis, not the source's
Family offices considering office acquisitions can underwrite a concrete income advantage from certification, but deployment strategy depends on which premium tier the local market has already priced in. In Hong Kong and Amsterdam, where the gap between certified and non-certified rents exceeds 18%, acquiring uncertified stock and retrofitting to certification may unlock immediate revaluation. In Chicago and New York, where the premium sits below 8%, the retrofit capital cost may exceed the rental lift unless the building is already close to certification thresholds.
The data argues for platform capital deployed alongside sponsors with in-house sustainability engineering rather than passive LP commitments. A sponsor who can move a building from uncertified to BREEAM Excellent in London captures roughly 10% rent growth from certification alone, independent of market rent appreciation. A sponsor who can reach BREEAM Outstanding from Excellent captures another 18% over that baseline. That optionality is worth underwriting as a separate return stream, but only if the GP has the technical capability to execute the upgrades and the tenant relationships to re-lease at the higher rate.
Family offices should price in regulatory trajectory when modeling the premium. In cities where green certification is becoming a policy requirement for new leases or refinancing, the premium may compress as supply catches up, but the discount on uncertified stock will widen. The downside protection comes from owning certified assets that remain financeable and leaseable as compliance thresholds rise. Avoid value-add plays that assume an uncertified building will hold its rent in a market moving toward mandatory standards.
Longer lease terms on certified buildings reduce rollover risk and stabilise cash flow, which matters for family offices that cannot afford frequent re-leasing capital or dark periods. If the Savills data shows certified offices in London achieving both an 18% rent premium and longer lease durations, the levered return on a certified acquisition may be 200 to 300 basis points higher than on an equivalent uncertified building, assuming similar entry yields. That spread justifies paying a modest acquisition premium for certification, but only up to the point where the entry yield compresses below the family office's cost of capital.
