Office fitout: economic benefits verified
It is one thing to discuss increased sustainability in the office fitout industry as having environmental merit, but what about the economic benefits for a business? ISIS proves that a five-star, environmentally friendly fitout benefits business, and doesn’t break the bank.
As a founding member company of the GBCA (Green Building Council of Australia) and a national fitout and refurbishment contractor, we made an early commitment to use our own office spaces to demonstrate that a five-star interior fitout can be delivered cost-effectively and to a high standard of quality.
In 2007, our board mandated a five-star Green Star minimum for all of our offices and we have achieved these ratings at our Melbourne, Sydney and Adelaide offices, with Darwin and Perth going through the process, while Canberra is pursuing a six-star rating by 2012.
In 2009, we engaged an independent assessment of the broader impact of the five-star Green Star fitout our Melbourne office was awarded in September 2011.
The 5 Queens Road building that houses our Melbourne office started out as a B-grade office block. The 1980s 10-level tower had been barely improved since the day it was built, but it offered spectacular views over Albert Park, where the Australian F1 Grand Prix is held, and Port Phillip Bay.
The aim of the refurbishment was to show that not only can a company achieve a high quality fitout in an existing building, but that it is also possible to do so for a small premium over a standard refurbishment.
As part of the refurbishment we stripped the previous tenancy back to its core and upgraded the air-conditioning system, built a stairway between levels seven and eight, and instigated an open-plan office design with 150 workstations. The fitout incorporated:
- mandatory requirements for natural light
- additional fresh air
- energy efficient heating and cooling systems
- energy efficient lighting
- low VOC (volatile organic compound) and formaldehyde products
- breakout areas for employees to relax and socialise with other employees, including meal areas that incorporate commercial coffee-making facilities
- the use of plants and ‘green walls’ to improve air quality and morale as employees respond positively to plants, and
- an open-plan layout with fewer partitions.
The sustainability cost/premium was less than five percent. The extra cost was due to accreditation, but is considered offset by increased staff satisfaction and the potential for increased productivity.
To undertake the assessment of the new office, we commissioned CETEC, a respected consultant, to conduct pre- and post-occupancy assessments comparing the previous office with the newly fitted out Melbourne office. By taking a scientific approach to assessing sustainability, we wanted to substantiate the financial, employee and ecological benefits commonly attributed to sustainable fitouts.
One of the key criteria was indoor environmental quality (IEQ) measurements – a measurement that has been linked to occupant satisfaction and improved productivity, with equal emphasis placed on sustainability, occupant satisfaction and productivity.
STAFF SATISFACTION OF 92 PERCENT ACHIEVED
Twelve months after the fitout was completed, the first phase of the post-occupation study found a major improvement in all categories of occupant satisfaction, with an overall office satisfaction level of 92 percent from 27 percent in the same office.
Staff retention rates are central to a profitable and growing business, and we estimate that the loss of a valuable employee can be as high as 50 percent above their previous remuneration.
Offering a premium office environment is not just about improved productivity and retention. It also assists in attracting the best talent to a business. Since we moved into the new office, staff turnover has dropped measurably.
The results are attributable to substantial improvements in thermal comfort and air quality, with improvements also in acoustic quality, lighting and office layout. There are also measurable improvements in carbon dioxide, formaldehyde and VOC concentrations in the air. In addition, there are also fewer air-conditioning draughts.
Collaboration is encouraged by the new office layout and staff enjoy a greater sense of life/work balance within the workspace due to the amenities provided. These include a gym, a professional-grade coffee machine, lunch facilities and a very popular table tennis table.
Staff satisfaction is now at 92 percent, 65 percent higher than the previous tenancy. The pre-occupation assessment showed satisfaction results at well below the average, with the exception of lighting.
Post-occupation results showed considerable improved satisfaction in:
- general building satisfaction (27 to 92 percent)
- air quality (33 to 92 percent)
- office furnishings (58 to 90 percent)
- office layout (50 to 77 percent)
- thermal comfort (12 to 53 percent), and
- cleanliness and maintenance (40 to 88 percent).
More modest improvements were found in:
- acoustic comfort (36 to 53 percent), and
- lighting (70 to 87 percent).
MEASURABLE PRODUCTIVITY GAINS
Critically, CETEC reported that employee satisfaction levels and their improvement correlated with these improvements, demonstrating a clear link between the investment in the fitout and staff satisfaction.
The report stated in its executive summary, “These improvements are likely to translate into measurable productivity gains.” It also noted “a degree of consistency” between the occupant satisfaction survey and the IEQ measurements.
On productivity, CETEC referred to the 2006 ‘Indoor Climate and Productivity in Offices’ report by the Federation of European Heating and Air-Conditioning Associations Guidebook. The CETEC summary reported, “The indoor environment can influence staff job satisfaction and well-being and so contributes to productivity.”
Validations of productivity outcomes are now being undertaken by CETEC within the next phase of the assessment, which is due to be completed in 2012.
ISIS is a founding member of the Green Building Council of Australia and has operated as a private, sustainability-focused construction company for over 20 years. It has completed more than $175 million worth of Green Star office interior projects in Australia.
Recently completed projects include the South Australia Police Headquarters, Data Hall 2 data centre at the University of Melbourne, an activity-based working fitout at Goodman’s Sydney head office, the Marriott Hotel in Surfers Paradise, the Hilton Hotel in Brisbane and the Sydney Children’s Hospital. New works underway include projects for the University of Sydney, Allens Arthur Robertson and Star City casino.