Green buildings are not only for the privileged few, they are accessible and beneficial to all. As South Africa faces rising energy costs, water shortages, and growing investor pressure for assets that meet ESG (Environmental, Social, and Governance) criteria, the property industry must adapt. Contrary to common misconceptions, green buildings are not inherently more expensive. In fact, they deliver long-term financial and environmental benefits, often at little to no extra cost.

The Green Building Council South Africa (GBCSA), an independent third-party verifier, defines a green building as one that reduces its environmental impact across multiple areas, including energy and water efficiency, material use, waste, indoor air quality, transport access, and socio-economic benefits.

“People often assume green buildings are about extravagant add-ons like solar panels,” says Lisa Reynolds, CEO of GBCSA. “In reality, they prioritise efficient design – reducing resource consumption while enhancing occupant well-being and long-term sustainability.”

Efficiency First is the Smartest Way to Build Green

The most cost-effective way to build ‘green’ is through efficiency – not only in energy and water use, but across materials, waste, and the quality of the indoor environment. Efficient design focuses on consuming less resources overall through optimised building performance. This results in lower operational costs and enhanced occupant well-being.

According to the MSCI South Africa Green Annual Property Index (2023)*, over eight-years, green-certified buildings used 7% less electricity and 21% less water per square metre.

“The greatest energy saved is the energy never used,” says Reynolds.

“Energy efficiency is the ‘first fuel’ – it should always come before adding solar panels or high-tech solutions. Simple design choices like passive cooling, insulation, efficient lighting, responsible material selection, and water and waste reduction strategies can dramatically lower a building’s environmental footprint while keeping costs in check.”

Green Buildings Don’t Need to Cost More

A common misconception is that green buildings are significantly more expensive to construct. In reality, a 4-star Green Star-certified commercial building costs about the same as a conventional one.

“You can build a ‘Ferrari’ of a green building if you want to, but you can also achieve certification at industry-standard costs by applying best practices,” says Reynolds.

GBCSA’s 2022 Cost of Green Report* found that the average ‘green premium’ for office projects was 3.15% for projects certified between 2019 and 2021, with steady decreases year-on-year. Fast-forward to 2025, and you’re looking at negligible cost differences.

Reynolds adds: The lifespan of a new building is at least 30 years, meaning today’s decisions impact long-term value. In 10 years’ time, inefficient buildings will struggle to attract tenants and investors, facing higher operational costs, expensive retrofits, or even declining property values. Future-proofing through green building practices and certification is a smart business decision for long-term resilience and competitiveness.”

Financial Performance: Green Buildings Outperform

Green-certified buildings prove that sustainability can be profitable through their better financial returns.

The MSCI Index reports that green-certified offices in South Africa delivered a total return of 5.8%, outperforming similar non-certified offices by 1.5 percentage points. Net operating income per square meter was 30% higher for green-certified offices.

“The data proves that certified buildings attract higher rental yields, lower vacancy rates, and offer stronger returns,” says Georgina Smit, Head of Technical at GBCSA.

Certified green buildings also attract financial benefits such as lower risk profiles for investors, sustainability-linked financing, green bonds, and preferential loan rates.

Retrofitting is the Fastest Route to Sustainability

With the fact that globally 70-80% of the buildings that will exist in 2050 are already built, retrofitting is key to achieving our sustainability goals. In South Africa we can start achieving this through simple upgrades such as LED lighting and insulation. Smart building management systems can cut energy use by 30-50%, with payback periods as low as 3 to 7 years.

“One of the easiest ways to improve a building’s energy efficiency is by shading windows to reduce heat gain. It’s more cost-effective than retrofitting double glazing,” says Reynolds.

The Role of Independent Certification in Mitigating Greenwashing

As demand for sustainability grows, so does the risk of companies making unverified environmental claims known as ‘greenwashing’. GBCSA provides accountability through independent, third-party verification, ensuring that green buildings meet measurable performance benchmarks rather than self-declaring sustainability.

A Call to Action for South African Developers and Investors

GBCSA drives systemic change beyond certification. As a not-for-profit organisation, it collaborates with relevant stakeholders such as the Presidential Climate Commission, municipalities, and the private sector to shape green building regulations and financing solutions.

“The evidence is clear,” says Reynolds. “Green buildings perform better than their counterparts and cost the same (or less) in the long run. They are the only viable way forward as energy and water costs rise.”

South African developers, investors, and building owners should be prioritising green building, whether through new builds or retrofits. This is the most effective way to future-proof their properties and deliver sustainable, high-performing buildings.