Keppel, FiCO Pan-United Concrete, and Coteccons Construction JSC earlier in May signed an MoU to explore the use of sustainable concrete, ready-mix mortar, and other innovative architectural materials, as well as construction methodologies utilising 3D printing in The Infiniti, the third phase of Keppel’s Riviera Point residential development.

As part of this collaboration, Keppel will be the first real estate company in Vietnam to incorporate sustainable concrete solutions via CO2 mineralised concrete tech in its project, which enables the embodied carbon to be reduced at the construction stage.

It is estimates that on completion, The Infiniti will use 2,800 tonnes less embodied carbon compared to using conventional materials. This is estimated to be equivalent to carbon sequestered by more than 46,000 trees grown over 10 years.

Innovation props up ESG prospects (illustration photo/ Source: freepik.com)

According to Lee Leong Seng, head of Property Development and Residential Real Estate in Vietnam at Keppel Ltd., Keppel is committed to advancing the country’s sustainable development.

“We are pleased to embark on this partnership to incorporate sustainable concrete solutions into our Riviera Point development, starting with The Infiniti, which supports our carbon reduction goals as we contribute towards a greener built environment,” Seng said.

Meanwhile, Nguyen The Phu, managing director of Coteccons, said that this company is firmly committed to implementing ESG principles throughout its entire value chain.

“We actively implement a range of ESG solutions, from utilising renewable energy sources and minimising carbon emissions, and applying the reduce, reuse, recycle model at our offices and construction sites. This dedication extends beyond our own operations and encompasses our partners and subcontractors that share our commitment to environmental protection and provide sustainable products and services that meet the exacting standards of environmentally conscious companies like Keppel,” Phu said.

According to Alex Crane, managing director for Knight Frank Vietnam, applying sustainable elements to commercial activities will continue at pace.

“Any high-end office building must have sustainability certification if it wants to serve multinational companies. It is predicted that the market will need more sustainable buildings. The market will also have many factories and warehouses built according to sustainable criteria. Therefore, in 2024 we will not only talk a lot about green buildings but also about green leasing contracts,” Crane said.

In developed countries, from the design and construction to operation of buildings, investors have become environmentally conscious and sustainable performance measures are constantly being introduced, Crane added. This is a positive because sustainability in buildings will be enhanced, and operations will be more efficient with improved technology and lower costs.

“I think this trend needs more attention in Vietnam where environmental certifications are currently less applied, except from well-known developers,” he added.

In office rental, Ho Chi Minh City boasts 14 green-certified buildings. Hanoi is about to take on two more officially green buildings towards the end of 2024, bringing the total number in the capital to 16.

In Ho Chi Minh City, a number of office buildings that have been evaluated for LEED certification include Deutsches Haus, the Friendship Tower, and Presidential Palace. In Hanoi, typical examples are Techcombank Tower, Capital Place, and Lancaster Luminaire.

In the industrial sector, Frasers Property, CORE5, Deep C, Emergent, LOGOS, and many other companies have applied sustainable criteria in recent years.

“In a flat market, green constructions will help certain developers to be outstanding compared to others. So developing buildings that meet sustainable development standards is essential. Green office buildings in Ho Chi Minh City always have higher occupancy rates and higher rents than non-certified buildings,” said Crane.

He added that some people believed that developing environmentally recognised projects would be expensive, but in reality this is less expensive than normal projects. “With different levels of accreditation, projects with low costs can still achieve more certification items and can still benefit,” he added.

Meanwhile, in real estate, the governance portion of ESG evaluates aspects of corporate leadership, transparency, and ethical standards in corporate decisions, and is being taken more seriously.

Troy Griffiths, deputy managing director of Savills Vietnam, said that good corporate governance is ever more important. “There is also an opportunity to improve relationships with tenants and the wider community, while also addressing issues such as wellness,” said Griffiths.

Additionally, green leases can be used to encourage landlords and tenants to agree sustainability-linked targets and performance indicators as part of an ongoing collaboration.

“Examples might be for a tenant to submit fit-out plans showing recycled and recyclable content of material used, or for a landlord to commit to support paper, plastic, and metal recycling efforts,” he said.

“Also, food and beverage operations may be encouraged through a green lease to reduce food waste, make use of on-site composting or sending cooking oil for recycling into bio diesel. These all require greater collaboration than many existing landlord-tenant relationships,” he added.