Can Australian companies meet their net zero targets, fulfill reporting obligations, attract people back to the office and enhance employee engagement all in one move? Vicinity Centres’ Chadstone Place presents a prototype for a zero-carbon office that ticks every box.

With commercial buildings responsible for roughly 10% of Australia’s emissions, corporate occupiers are looking closely at their leases. Two-thirds of Melbourne’s largest office tenants and around three-quarters of those in Sydney have ambitious emissions reduction targets, according to JLL.

One of the most efficient ways to meet these emissions reductions targets is to occupy net zero ready, electric buildings. However, there’s a widening demand gap: JLL estimates a “negligible volume” of net zero buildings in the Sydney and Melbourne CBDs.

Tenants face two choices: negotiate with landlords to upgrade their buildings or relocate. Officeworks, aiming for 100% renewable energy by 2025 and net zero emissions by 2030, opted to relocate when Vicinity Centres proposed a transformation of Chadstone Place, a modest office in the heart of Melbourne’s Chadstone – The Fashion Capital.

From compliance to commitment

A host of drivers are propelling companies toward net zero buildings: reporting standards and regulation, employee engagement and shareholder expectations among them.

Beginning on 1 January 2025, the Australian Sustainability Reporting Standards require the nation’s largest corporations to report on all three scopes of emissions. EY’s 2024 report, Zeroing in on Net Zero Buildings, found these standards will have “profound implications” for the future of corporate office space.

Officeworks, part of ASX top 10 company Wesfarmers, discloses its emissions under the Australian Government’s National Greenhouse and Energy Reporting Scheme and has structured its reporting using the Task Force on Climate-related Financial Disclosures recommendations since 2018.

But moving into a zero-carbon building wasn’t about compliance, says Fiona Lawrie, Officeworks’ Head of Sustainability. “We are 100% committed to being 100% renewable across all our operations.”

The motivation behind relocating Officeworks’ “store support centre” to Chadstone Place was to create a space that resonates with the company’s 10,000-strong team, Fiona notes. “Our team has told us climate action is important to them and we know a well engaged team delivers so many benefits for our business.”

Retrofit and renew

Built in 2006, Chadstone Place had solid foundations. Yet, as Vicinity Centres’ Construction Delivery Partner for Development Jayne Richardson puts it, Chadstone Place was still “of its time”. Today, it stands as a fully electric, future-ready office, and among Australia’s first commercial buildings to be powered entirely by onsite renewable energy.

While the term “net zero” is abstract to most Australians, Vicinity’s ambition was to make sustainability visually compelling and integrated into the building’s architecture.

“How do we make net zero visible?” Jayne asks. The solution is to make sustainability “overt”. Think solar panels on the adjacent car park roof – which now generate equivalent energy to 220 average Australian homes for a year. Think exposed services in the ceilings, eco-friendly materials and an abundance of plants that create an aesthetic that speaks to sustainability at first glance.

As part of the refurbishment, outdated gas boilers were replaced with electric heat pumps, lighting was updated, and a high-performance façade was installed. The only new construction, aptly named ‘The Link,’ is a glass bridge adorned with greenery connecting the original building to the car park. This striking addition, anchored by a mature tree at its centre and featuring 150 sqm of outdoor terrace space, symbolises sustainability and serves as a flexible workspace and arrival point for the Officeworks team.

By choosing to redesign rather than demolish, 88% of the structure’s net lettable area was retained, while 91% of construction waste from the retrofit was diverted from landfill. This commitment aligns with Officeworks’ zero waste goal, as Fiona emphasises.

Electric dreams, energised for the future

Designing new buildings with electric systems, instead of gas, is “fairly straightforward,” says Laurent Deleu, founding director of engineering firm ADP Consulting. Retrofitting existing buildings to eliminate gas presents a more complex challenge, Laurent adds.

Powering commercial buildings with 100% renewable energy is also difficult, and feasible mostly for larger sites such as shopping centres and university campuses, while “CBD offices face significant constraints due to limited roof space”.

Chadstone Place's standout achievement lies in the remarkable reduction of embodied carbon from construction and materials. By opting for retrofitting over redevelopment, Vicinity Centres saved more than 1.1 million kilograms of carbon – equivalent to 1,100 tonnes of carbon per square metre of reused space.

Chadstone Place’s accomplishments have been verified by Living Future, earning Australia’s first Zero Carbon Certification, the world’s only performance-based standard to address both operational and embodied carbon emissions.

“To achieve Living Future’s rating, we had to demonstrate a 30% improvement in energy efficiency and to ensure embodied carbon emissions did not exceed 500 kilograms per square metre. We reduced Chadstone Place’s energy consumption by 62% and kept embodied carbon below 100 kilograms per square metre. We haven't just met Living Future’s targets; we've blown them out of the water,” Laurent says.

Sustainable spaces, engaged employees

Chadstone Place has also achieved Green Star and NABERS certifications; yet, for employees, green ratings are a baseline expectation. As Fiona notes, employees expect Officeworks to take action to reduce emissions.

What stands out for employees are the sustainability features throughout the building, from the hundreds of indoor plants to the electric bike, scooter and car charging stations, the openable windows flooding the spaces with fresh air, to the neurodiverse-friendly lighting and colour scheme.

Since the move, engagement among Officeworks’ 800-plus employees has soared – even drawing positive feedback from store-based team members. Workplace sentiment has improved by an impressive 27% in just one year. One team member remarked that the new office has “injected fresh energy” into the work environment, boosting motivation to be present regularly. “People have returned to the office in droves,” Fiona says, noting that mid-week attendance nearly doubled.

Chadstone Place’s palpable positive energy reflects that of the project team, Jayne Richardson adds. Upgrading Chadstone Place was both an “obligation and an opportunity”.

“Around two-thirds of the buildings we have today will still be standing in 2050. The challenge is: how do we fix them? We need enlightened tenants, ambitious landlords and motivated consulting teams to work together. When we do, we can create something even better than we imagined.”