03 Oct 2023
Joint venture partners Frasers Property Industrial and Aware Real Estate made a big, bold decision at The YARDS in Kemps Creek, and are showing Australia the power of an all-electric industrial precinct.
The future is electric – but it is the decisions we make today that will shape that future.
The $1 billion premium industrial precinct in Sydney’s Kemps Creek became Australia’s first Green Star Communities industrial precinct in May 2023.
Frasers Property Industrial and Aware Real Estate achieved the highest possible 6 Star Green Star Communities v1.1 rating representing ‘world leadership’ and gained kudos as much for the gas they left out as the amenity they put in.
“Many of our customers are well advanced on their decarbonisation journeys. Logistics and supply chain businesses care about climate change and are solving some big sustainability challenges. But buildings are lower on their list of priorities than some other, more pressing, net zero challenges. It’s our job to make it easier for them go all-electric.”
Andrew Thai, Sustainability Manager, Frasers Property Industrial
When the development team started their journey, “we were really looking for that point of difference to provide our customers not only a pathway to their net zero targets, but also an experience at The YARDS that no one had attempted in the industrial space,” says Tamara Williams, Director of ESG at Altis Property Partners.
Altis Property Partners provides support services to Aware Real Estate. Tamara was an early advocate for The YARDS to be the first industrial development to achieve a Green Star Communities rating.
“It was great to be able to retrofit a Green Star rating tool to our industrial precinct to demonstrate that amenity and customer wellbeing are important in our industrial precincts,” Tamara says.
For Australia to meet net zero by the middle of the century, the GBCA’s Climate Positive Roadmap for Precincts is crystal clear: all new precincts must be fossil fuel free and use 100% renewable electricity by 2030.
The YARDS is seven years ahead of schedule and as Frasers Property Industrial’s National Sustainability Manager Andrew Thai notes: “Our precinct is future proofed. By going all electric from the outset, we don’t need to spend any money stripping out gas down the track. We just didn’t put it in.”
The YARDS fast facts:
Switched on sustainability
The YARDS meets the needs of today’s tenants and reduces the risk of stranded assets in the future.
The Australian Energy Market Operator expects 83% of Australia’s energy generation to be renewable in 2030. As our electricity grid decarbonises, the remaining source of emissions – fossil gas burned for heating, hot water and cooking – comes into sharper focus.
Gas is responsible for almost 30% of building energy consumption in Australia. One of the easiest ways to support an all-electric future is to remove the need for fossil fuels in the first place – and this is what Frasers Property Industrial did at The YARDS.
“Electrification is relatively easy in the logistics sector, because most tenants are distributors – rather than manufacturers – and they don’t need gas.”
Industrial properties, with their vast roof space, can be renewable energy powerhouses. Every facility at The YARDS will feature on-site rooftop solar, and Frasers Property Industrial and Aware Real Estate expects at least 2MW to be installed across the estate.
“We will be working with each customer to identify opportunities to expand their rooftop solar array and procure 100% renewable energy.” said Andrew Thai. Energy modelling undertaken has predicted a greenhouse gas reduction of 85% when compared with business-as-usual.
Electric vehicle charging stations have been installed at each site, and provisions have been made for future expansion.
Better for people and planet
An all-electric industrial precinct is better for people and planet. Cooking with gas, for instance, presents a similar asthma risk to second hand cigarette smoke, and a 42% increase in the incidence of childhood asthma.
But the truth is the lack of gas infrastructure won’t be the feature that captures the attention of the 2,500 permanent employees who will work at The YARDS.
But they will notice the cycleways and paths that snake their way around the precinct to create a walkable neighbourhood and encourage active living. They will appreciate the healthy food and beverage offerings.
“When we started developing The YARDS, we asked ourselves: ‘What does a good response to human health, physical and mental wellbeing look like in an industrial community?’ We didn’t know the answer, but Green Star Communities helped us find some answers,”, Tamara says.
Prior to The YARDS, a Green Star Communities rating had only been awarded to residential, mixed-use commercial and retail precincts. The development team adapted the rating tool so it could be applied to an industrial precinct.
“We want to create efficient places that deliver operational savings. But the Green Star Communities rating also translates into other benefits that are hard to put a dollar value on, like walkable access to amenities and community development, and other initiatives that create healthy places for people,” Tamara adds.
This focus on health and wellbeing is a long-term commitment; Frasers Property Industrial is a foundation corporate partner of Healthy Heads in Trucks and Sheds, for instance, which champions mental health and wellbeing for all people in the supply-chain sector.
“We are selling a precinct where businesses can operate efficiently and where people can enjoy a healthy and active lifestyle. We see it as a natural progression in the sustainability evolution,” Andrew says.
An all-electric future
Each year, around four billion tonnes of goods are moved around Australia – that’s 163 tonnes of freight for every person. As Andrew says: “The future of our economy is underpinned by the efficient movements of goods.”
Australia’s logistics footprint is growing exponentially. CBRE estimates that an additional 70,000 sqm of logistics space is required for each $1 billion of additional e-commerce sales.
While around 80% of commercial office tenants are incorporating electrification into their leases, the industrial sector has been slower off the mark.
For Frasers Property Industrial and Aware Real Estate, the decision to electrify The YARDS came with a financial benefit and was a starting point for new conversations with customers.
Was the development team concerned that eliminating gas would exclude a potential tenant base? “It was a worry,” Andrew admits. “But demand has been high from customers wanting to join us and be part of our vision.”
“Some customers simply want a convenient location near major road networks – and The YARDS provides that. But we believe it is only a matter of time before net zero comes onto their radar. And when it does, we have built an all-electric precinct that is ready to help them.”
GBCA congratulates Frasers Property Industrial and Aware Real Estate. As the first industrial estate in Australia to achieve a 6 Star Green Star Communities certification, The YARDS is a world-leading project displaying the future of work, today. Frasers Property is a valued Carbon Positive partner to GBCA and we thank them for their leadership and ongoing support in this space.