Infrastructure
| Sector | Infrastructure |
| Sub-sector | Real Estate |
| Location |
Europe |
Up to 70 per cent of European office spaces have not been updated or renovated in over two decades.1 Consequently, the infrastructure of these buildings is often outdated and contributes to inefficient energy use. This includes aging insulation, energy-intensive heating and cooling systems, and outdated control mechanisms.
The growing discrepancy between the supply and demand for sustainable buildings,2 coupled with ambitious emission reduction targets, is creating new investment opportunities in the sector. Both investors and tenants are increasingly looking to transform older buildings into modern office spaces with high-rating sustainability credentials that align with current environmental and regulatory expectations.
Edge is looking to leverage its proven experience in sustainable office development to capitalise on market dislocation in the European office sector and execute a brown-to-green strategy focused on modernising office buildings.
Edge’s credentials in sustainability enable it to create next generation office products that prioritise functional design, office collaboration and employee wellbeing.3 Edge is adept in identifying assets with features suitable for high-impact sustainable upgrades, including flexible and functional floor layouts, optimal floor-to-ceiling heights, and durable existing facades.
Targeted measures include innovative heating and cooling solutions, energy-efficient fixtures and an integrated proprietary technology solution that facilitates the sustainability performance required. Locally based teams are skilled in determining opportunities that are ideally situated in proximity to transport networks and key amenities.
Outcome
The 23-story Cross Towers office building presently falls short of industry energy performance standards, highlighting a need for modernisation. Edge has a targeted program of retrofit works to improve the asset’s energy performance. The program aims to reduce the building’s energy usage by more than 40 per cent, while the retrofitting costs and the embodied carbon impact are projected to be significantly lower than those associated with new constructions, on an all-in cost basis.4
Edge plans to implement its strategy in key European cities such as Amsterdam, Berlin, Munich, London and Paris. In partnership with institutional investors, the approach reflects Edge’s commitment to contributing to the sustainability and energy efficiency of office spaces.
global CO2 emissions generated by offices5
operating history
emissions reduction target for all new projects by 20306
Acquiring Cross Towers marks a pivotal shift for Edge. We're moving beyond developing high standard assets to also actively upgrading existing assets. This deal showcases our commitment to transforming buildings into high-performance, sustainable properties.”
Coen van Oostrom
Founder and CEO
Edge
1. PMA (Property Market Analysis), ‘European Offices: Overview & Forecast - Main Scenario’, April 2024,
2. World Economic Forum, ‘Why 2024 is the tipping point for investing in sustainable buildings’, January 2024.
3. Edge’s buildings have been recognised by the Building Research Establishment Environmental Assessment Method (BREEAM) (The Edge) and received Leadership in Energy and Environmental Design (LEED) Platinum Certifications (Unilever Marketplace).
4. Calculations based on analysis conducted by Edge’s independent advisory, DWA, April 2024.
5. UN Environment Programme, 2024 Global Status Report for Buildings and Construction, March 2024.
6. Edge, ‘Edge commits to Net Zero for all future developments’, July 2022.
At Macquarie Asset Management, we view sustainability as part of our fiduciary duty to protect and grow our clients’ assets. This focus also helps us generate positive outcomes for our investee companies and the communities they serve. Our latest Sustainability Report outlines the progress we have made over the past financial year.
