Environment

Highlights
Green Design and Environmental Sustainability Strategy introduced
Waste management reviewed at all centres
Full waste recycling of plastic, cans, glass and cardboard implemented at all centres
Energy audits undertaken and remedial measures introduced to reduce consumption
Eskom rebate programme implemented at six centres

Environmental impact policy and management

As a primary tenet we recognise that in the development and management of our properties, our operations may have a significant impact on the environment and local communities as well as on the tenants and staff who occupy our buildings. All policies for management and remedial actions are framed in terms of this principle.

We are committed to the continuous improvement of our operations with the aim of reducing our environmental impact, minding our role as a responsible corporate citizen in preserving environmental resources, making a positive impact on the wider community and encouraging our tenants, customers and suppliers to do the same, and enhancing the daily workplace for our tenants and staff.

The group’s Development Executive, Steven Riley, is responsible for the policy and strategy in this regard, supported by the National Facilities and Technical Manager. The social and ethics committee takes responsibility for overseeing and monitoring his progress in this regard. The Development Executive further provides feedback to the risk committee in respect of policy principles and goals and targets at each asset.

Group environment policy and strategy are communicated at the executive committee level and operationally to the centres’ operations managers. Quarterly reviews are conducted to assess progress in line with group strategy.

During the year Hyprop’s Green Design and Environmental Sustainability Strategy was introduced and implementation began. The strategy outlines the opportunities, expected ease of implementation of each objective and resultant benefits.

Opportunities include:

• Lower operating costs: related to energy, water and waste consumption;
• Decreased operating costs: increased property values and more competitive leasing terms;
• Enhanced marketability: as an environmentally responsible group
• Reduced liability and risk: future utility costs, stringent legislation, carbon taxes;
• Responsible investing: doing the right thing at an investor level; and
• Increased value related to ambient environment: design as a differentiator

Focussed and proactive asset and operational management includes:

Objective   Ease of
implementation
1 to 5 (1-easiest)
  Benefits
Management        
    Responsive facility management team   1   Timeous intervention to mitigate risk and loss
    Set consumption targets and monitor (energy, water and waste)   2   Measure performance by setting targets and monitoring with meters
    Implement a building user training programme for operational staff   2   Raise awareness related to technology, legislation, best practices
    Supply chain management   2   Select vendors based on environmental performance
    Review tariff structures   2   Choose a tariff structure that is optimal to a building’s peak usage
    Provide current and comprehensive manuals on site   3   Assist with effective maintenance and operational levels
    Monitoring tenant conformance to tenant criteria document   3   Ensure mall operational and statutory requirements are fulfilled
    Provide IT help desk to track user feedback   4   Quality feedback informs decision-making
Safety, security and code compliance        
    Fire alarm testing and safety drills   1   Ensure that equipment is operational
    Planning and management of security risks   2   Ensure occupants and shoppers are safe
    Comply with health and safety and disability requirements   2   Ensure that statutory requirements are fulfilled
    Control tenant's work related to tenant installation   4   Reduce risk of legislative non-compliance

Progress against certain objectives during the year is detailed in the table below:

Objective   Achievement
Determine the baseline of energy use through an energy audit, for the purpose of benchmarking and measuring improvements   This was completed for energy, water and waste for the 12 month period
Review site specific building maintenance and operational issues   Ongoing reviews were undertaken by the National Facilities and Technical Manager in conjunction with the centres’ operations managers
Establish targets and goals   Energy: targets determined per site (savings range from 0 to 8%)
Targets still to be set for water and waste   Raise awareness related to technology, legislation, best practices
Select optimal upgrade initiatives   A draft proposal has been prepared for review in May 2013
Focus on delivery of strategy   Monitored specific to each property

As the strategy is in the early stages of implementation, it was not deemed necessary to conduct independent evaluations. The group is planning to conduct a carbon audit in the near future.

Fines

The group did not receive any significant fines for non-compliance with environmental laws and regulations during the year.

Green building

Hyprop is a member of the Green Building Council of South Africa (“GBCSA”), and as such has committed to actively support and adhere to their vision and mission. Hyprop will ensure that the buildings we manage are operated in an environmentally sustainable way, and that all of our new developments are designed and built to minimise negative impacts on the environment while offering healthy, efficient and productive environments for occupants.

Conserving scarce resources

We consider resource scarcity a key strategic risk to the company, as a lack or short supply of water or electricity will impact current operations and future planned projects. The objectives in this regard as set out in Hyprop’s formal environmental strategy are outlined overleaf with their expected ease of implementation and resultant benefits.

During the year Hyprop recycled 60 000m3 (68% of total) of waste. A comprehensive lighting saving initiative was implemented throughout the portfolio in the fourth quarter resulting in a saving of 60 000kWh at year-end.

The following tables list sustainability opportunities relating to energy, water, waste and indoor environmental quality:

ENERGY

Objective   Ease of
implementation
1 to 5 (1-easiest)
  Benefits
Sub-metering electricity consumption   1   Detect faulty installations, monitor and control consumption in multi-tenant environment
Modify thermostat set-points and supply temperature for chiller water   1   Lower energy costs in winter and summer
Variable speed drives   2   Improved control to assist correct commissioning
LED lighting and occupancy sensors   2   Improved lamp life and reduced power faction correction required;
Repair duct work leakage   2   Lower energy losses
Implement preventative maintenance programmes   2   Ensure optimum operation of equipment
Solar hot water heating   3   Low operating costs, more cost effective than gas and electricity
Peak energy demand reduction   3   Reduced cost of consumption, reduces peak demand
Power factor correction   3   Reduced kVA consumption
Light coloured surfaces   3   Reduces solar heat gain and reliance on artificial light
Building Management Systems   4   Improved energy use, cost reduction, proactive response and assistance in identifying problems
Duct work and pipe work insulation   4   Air conditioners run more efficiently
Architectural shading and external planting   4   Reduce solar gain and energy usage
Photovoltaic (generating electricity using solar energy)   5   Clean energy source, technology ever improving
Building insulation   5   Lower energy consumption costs

A study to provide energy efficient or renewable energy services for reductions in energy, related to Photovoltaic installations intended to lessen the load on the energy grid was concluded in March 2013.

Below is information regarding the centres’ actions and initiatives to meet the objectives outline above:

water

Objective   Ease of
implementation
1 to 5 (1-easiest)
  Benefits
Sub metering for tenants   1   Ease of detection of leaks, cost effective and easily installed and identifies high consumption
Fire system water consumption   1   Identifies leaks and illegal use of water
Waterless urinals and dual flush toilets   2   Reduced use of potable water, no mechanical parts
Water leak detection   2   Identifies unusual flow patters
Drought resistant landscaping   3   Reduced water usage
Rainwater harvesting   4   Reduced potable water consumption and storm water provision
Grey/black water recycling (non-potable water in cooling towers)   4   Reduced use of potable water, suitable for irrigation
Irrigation using grey water (and use of indigenous planting)   4   Saving of water and effluent charges where applicable

Progress at the centres

waste

Objective   Ease of
implementation
1 to 5 (1-easiest)
  Benefits
Waste separation and recycling (operational waste management plan)   1   Reduced waste costs and enhanced corporate green initiatives
Centralised waste collection   2   Enhances overall neatness of building
Public recycling stations (glass, batteries, cans, cardboard and paper)   2   Provide customers opportunity to recycle
Organic waste composting   3   Reduced waste and less fertilizers used

Progress at the centres

indoor environmental quality

Objective   Ease of
implementation
1 to 5 (1-easiest)
  Benefits
Low irritant/non-chemical cleaning products   1   Prevents sick building syndrome
Dedicated smoking areas with butt disposal   2   Prevents harmful particles from entering building Reduces fire risk
Personal control of thermal conditions including open-able windows   3   Reduces energy consumption

Environmental sensitivity

Canal Walk and Willowbridge North and South are located within environmentally sensitive areas. The impacts on the adjoining protected areas are neutral as a result of conforming to the environmental policies and structures of the municipalities and management bodies responsible for these protected areas.

Canal Walk forms part of the greater Century City Precinct. Century City is located in and around a national wetland conservation area, Intaka Island, an award winning 16 hectare wetland conservation area that is rich in birdlife and indigenous plants. The Century City Property Association, which manages the Century City Precinct, has an Environmental Management Plan (“EMP”) to which Canal Walk Shopping adheres. Hyprop contributes R365 000 to this EMP annually.

On 22 April 2012 the Nedbank Gardens site adjoining Rosebank Mall was demolished to clear the area for the extension to the centre. The site clearance was conducted in accordance with a waste management and materials recycling programme, which formed part of the demolition contract. 31 000 tonnes of waste material resulting from the demolition were recycled.

The individual shopping centre’s responses to these objectives are detailed more fully on our website.

Read more on www.hyprop.co.za