Commonwealth Bank has launched a new zero-fee property sustainability upgrade loan to help property owners reduce their environmental impact while saving on operating costs.
With zero margin and zero fees, eligible businesses can increase their commercial property investment loan by up to 20 percent to complete property sustainability upgrades that achieve a rating improvement by the National Australian Built Environment Rating System (NABERS). Businesses can also qualify for the loan by lowering the property’s carbon emissions.
Thursday’s announcement follows the recent launch of a green loan for up to 600,000 of the lender’s retail customers.
The bank worked closely with NABERS - a national program administered by the New South Wales Department of Planning, Industry, and Environment - to develop the loan eligibility criteria that will help businesses reduce their emissions by at least 30 percent and meet or exceed average market performance.
“Sustainability upgrades can significantly reduce a property’s carbon footprint while improving energy and water efficiency said Claire Morgan, CBA’s head of business lending.
“To encourage businesses to play their part and make these upgrades, we are offering the ability to borrow up to an additional 20 percent, with zero line fees and no establishment fee through these loans,” she said.
“Investing in sustainability upgrades also makes commercial sense in that it can boost the value of properties while reducing operational costs, making the property more attractive to long-term renters and potential buyers.”
Buildings account for around 50 percent of electricity use in Australia and almost a quarter of emissions. According to the International Energy Agency, buildings offer one of the largest opportunities for low-cost carbon abatement in developed countries like Australia.
“With over 60 percent of commercial office buildings currently having a NABERS energy rating below five stars, this loan has great potential for buildings to make important energy efficiency upgrades,” Morgan added.
“We appreciate it’s a challenging time with some buildings experiencing reduced foot traffic or lower occupancy," she said. "However, for some businesses, this has become an ideal time to undertake building upgrades and property improvements.”
Depending on a company's situation and location, new green credentials could also make them eligible for other incentives like the federal government’s instant asset write-off or various state-based energy upgrade schemes.