As we enter 2025, we are witnessing a fundamental shift in both the investment and leasing markets: Environmental and sustainability considerations are now widely factored into leasing and acquisition decisions. While not all stakeholders have an active ESG strategy or a strong willingness to pay a premium for sustainable buildings, nearly all are evaluating how new environmental regulations will impact the buildings they own, wish to own, or consider leasing. This shift became significantly more pronounced in the latter half of 2024 than in previous years.

In 2024, we have recorded a growing number of lease agreements reflecting "green premiums." More companies are explicitly stating that they will only consider office buildings with an energy rating of B or higher when searching for new premises. Some occupiers are even requiring buildings to comply with the EU Taxonomy. However, the taxonomy’s energy consumption thresholds are set so that only 10–15 per cent of the building stock will qualify in the short term.

Findings from the Q4 2024 investor survey indicate that landlords are experiencing the same shift. The future demand for sustainable office space remains the primary motivation for investing in environmentally certified buildings.

"If sustainability consideration is part of your investment strategy, what is the reasion?"

Yes

While more than half of respondents report that tenants now place greater emphasis on sustainability compared to a year ago, few landlords have yet been excluded from leasing processes due to the environmental profile of their properties. However, many believe that the new EU sustainability requirements will lead to a growing rental gap between best-in-class “green buildings” and the rest of the market.

"Tenants place greater emphasis on environmental and sustainability factors when leasing new spaces than they did a year ago."

”Have you experienced being excluded from a leasing process due to your building’s environmental profile?”

In the investment market, we are observing a steadily increasing focus on the energy efficiency of buildings – both as a risk assessment measure and as a value driver for best-in-class sustainable assets. However, only a small proportion of investors are currently conducting in-depth evaluations of the carbon footprint of buildings. Such assessments are far more common in major European markets, and we expect that carbon reduction frameworks such as CRREM will gain wider adoption in Norway as well.

Transitioning to a greener portfolio remains a complex and capital-intensive process. Full-scale refurbishments come at a high cost, and opportunities to acquire fully developed green buildings remain limited. When such properties do come to market, they attract significant demand and command premium pricing. Currently, green buildings still represent a small fraction of total transaction volume, but this share is increasing. Over the past decade, only 1–2 per cent of traded properties have been classified as green buildings. By Q4 2024, this share had risen to 5 per cent. However, this increase may be partly attributed to lower overall transaction volumes and a few large deals making up a substantial portion of the market in 2024.

In other words, acquiring a green portfolio remains a challenge. To a large extent, market players must develop it themselves.

Number of green buildings in the transaction market