Commercial real estate developers, owners and tenants are finding that when they enter into new leases, it’s now important to read the green print.

Green leases are agreements that include clauses about good environmental, social and governance (ESG) practices, and they’re becoming more common, says Samantha Sannella, national managing director of Total Workplace Canada at Cushman & Wakefield.

“In Canada, we’re a bit behind Europe and the United States. But as government and other programs come in to bring us toward net zero carbon [greenhouse gas] emissions, we’re catching up,” Sannella says.

“Most green leases focus on provisions that set standards for reducing a building’s energy use for a start, but they also have other components that relate to social responsibility and good governance. There are no legal requirements for what areas and wording go into a green lease yet, but a lot of guidelines are emerging,” she adds.

Guidelines are being developed both in Canada and internationally. In the U.S., an organization called Green Lease Leaders has been advising landlords and tenants since 2014 on how to collaborate on green lease provisions.

It says a total of 6.1 billion square feet of commercial property in the U.S. are now under green leases, and internationally, there has been a 390-per-cent increase in the number of applications to have leases certified as green by the group.

Keep reading on theglobeandmail.com

• 
•