Green Star and NABERS: A Property Developer's Guide

Green Star rates what you designed and built. NABERS rates what the building actually used once someone turned it on. That single difference explains almost everything else about the two systems: who assesses them, when in the programme they bite, what they cost, and which of them can come back and embarrass you eighteen months after practical completion.

Green Star is run by the Green Building Council of Australia. It is voluntary, it covers a broad set of sustainability categories, and it is awarded on documentation reviewed by an independent assessment panel. The National Australian Built Environment Rating System (NABERS) is a government programme, administered by the New South Wales Government, to which its lodgement fees are payable. It is narrower, it measures energy, water, waste and indoor environment from twelve months of real metered data, and in some transactions it is not optional at all.

Most developers meet both by accident rather than by plan. A tenant’s brief asks for a number. A council’s development control plan points at one. A capital partner’s mandate references the other. By the time anyone works out which system is being asked for and what it takes to get there, the mechanical services design is half done and the submetering strategy is already wrong.

The figures, fees and thresholds below were current at the date of writing and they move: the Green Building Council of Australia reviews its certification fees at least annually, NABERS aligns its pricing to the consumer price index each July, and the planning rules change by state. Every number here links to the source that publishes it, which is where to confirm the position on any given day.

What is the difference between Green Star and NABERS?

Green Star assesses design and construction against a broad sustainability benchmark. NABERS measures operational performance after the building has run for a year. They are not competing ratings and a project can hold both.

The practical differences that matter on a development:

• What is rated. Green Star covers categories spanning carbon, energy, water, materials, ecology, indoor health and resilience. NABERS rates energy, water, waste and indoor environment separately, each on its own star scale.
• What the evidence is. Green Star is documentation: drawings, specifications, models, contracts, commissioning records. NABERS is meter data, floor area, hours of use and occupant counts, verified by an accredited assessor on a site visit.
• When it happens. A Green Star certified rating follows construction. A NABERS performance rating usually follows twelve to twenty four months of operation, because the rating needs a full twelve months of real data.
• Who holds it. Green Star attaches to the project and the developer typically drives it. NABERS attaches to the operating building, so the rating usually lands with whoever owns and manages it, which on a build to sell project is not the developer.
• Whether it lapses. A Green Star certified rating under the Buildings tool is a point-in-time certification of the completed project. A NABERS rating is valid for twelve months and then has to be done again on fresh data.

That last point is the one that catches build to hold developers. A 5 star NABERS Energy rating is not a plaque. It is a statement about last year, and it has to be re-earned.

What does Green Star actually rate?

Green Star awards a certified rating based on points achieved across the rating tool’s categories, on top of a set of mandatory minimums. Under the current buildings tool, only three levels of certified rating exist.

The Green Building Council of Australia describes the Green Star Buildings structure as three steps: meet ten minimum expectations, deliver on the Climate Positive Pathway where it applies, and then achieve credits, with total points determining the star rating awarded. The council states that the tool “awards one type of certification, Green Star Certified, with three levels of recognition, 4 Star, 5 Star, and 6 Star, representing Best Practice, Australian Excellence and World Leadership”.

Two things follow from that which tend to surprise people who last looked at Green Star a decade ago. There is no certified 1, 2 or 3 star outcome under the buildings tool, so a project either clears 4 star or it has nothing to market. And the Climate Positive Pathway, a set of targets covering fossil fuel free operation, renewable electricity, efficiency, lower carbon materials and offsets, sits between a project and any 5 or 6 star outcome. The requirements vary with the date the project registered, which is why registration timing is a design decision rather than an administrative one.

Projects can also take a Green Star Designed assessment, which the council describes as a precertification that the design is on track to achieve a rating when assessed after construction. On a project selling or leasing off the plan, that interim step is often what the marketing material is actually relying on.

Which raises a point that catches marketing teams rather than design teams. The council states that “Green Star is a Certification Trademark registered by GBCA. Only projects that have been assessed and certified by us can use the Green Star Trademark or claim to be Green Star projects”, and that it operates strict rules and licensing arrangements for use of the trade mark. A project targeting a rating is not a Green Star project, and the distance between “targeting 5 star Green Star” and “5 Star Green Star certified” is the distance between a claim the council licenses and one it does not.

Which Green Star rating tools apply to a development?

The tool follows the asset type and the stage, not the developer’s preference. The Green Building Council of Australia’s current rating system covers:

• Green Star Buildings, for new buildings and major refurbishments. This is the tool most development projects use. The council’s page records the current tool as Green Star Buildings v1.1 Rev A, released 17 December 2025, and states that project registrations for the superseded Green Star Buildings v1 closed on 30 April 2026, with projects already registered under v1 able to continue under that version.
• Green Star Communities, for precincts, neighbourhoods and masterplanned estates, with version 2 the current tool. Communities is fee-structured differently from the other tools, on a registration fee plus an annual fee.
• Green Star Performance, for the operations of an existing building, certified annually.
• Green Star Fitouts and the legacy Green Star Interiors, for tenancy and base building fitout works.
• Green Star Homes, for volume housing, priced by product range rather than contract value.
• Green Star Build to Rent and the Apartments Pathway within Green Star Buildings, the latter offering unit-level verification for Class 2 multi-unit residential projects including build to sell, build to rent, affordable and community housing. The council states the pathway carries no additional fee where a project opts in.
• Design & As Built, the legacy tool that Green Star Buildings replaced. It still matters, for reasons set out under the National Construction Code below.

A developer working across build to rent in Sydney or a staged masterplanned estate may end up holding two or three of these at once, at different stages, with different fee bases.

What does Green Star certification cost?

The certification fee is published, it is based on contract value, and it is the smallest part of the cost. The Green Building Council of Australia’s certification fees page sets out a Green Star Buildings scale running from $16,000 for a member with a contract value under $5 million to $105,900 for a member in the $500 million to $750 million band, with non-member fees roughly 20 per cent higher and projects above $750 million quoted individually. All figures exclude GST and the council states that fees on that page are valid until 31 October 2026.

Worked through on a mid-sized commercial project, the published numbers land like this. A building with a contract value of $60 million falls in the $50 million to $75 million band, where the council publishes a member fee of $36,800 and a non-member fee of $44,100, excluding GST. A non-member project team that uses all five included technical questions and then asks five more at $220 each, and opts into two rounds of Pre-Assessment Review at $220 per round, would see:

• Certification fee: $44,100
• Five additional technical questions at $220: $1,100
• Two Pre-Assessment Review rounds at $220: $440
• Total published Green Building Council of Australia fees: $45,640, excluding GST

Change one input and the arithmetic moves: the same project registered by a Green Building Council of Australia member pays $36,800 for certification, so the same additional items give $38,340 excluding GST.

What that total does not include is the part that actually shows up in a feasibility. The sustainability consultant who runs the submission, the additional modelling, the specification uplift on facade, glazing, plant and materials, the commissioning scope, and the contractor’s price for delivering and evidencing all of it. Those are quoted by the consultants and the builder, not published, and they are the reason a Green Star target belongs in the construction cost per square metre conversation at concept design rather than at tender.

The council also publishes discounts for non-standard pathways: 25 per cent off the standard certification fee per project under the sitewide approach and the volume approach, with the volume approach adding $7,500 plus GST for a common credits design assessment, and a Multiple Building Single Rating priced on total contract value plus 20 per cent for the first additional building and 10 per cent for each one after that. On a staged project, which pathway is agreed with the council before registration can move the fee materially, and the council states these must be agreed via an eligibility query before registering.

One commercial point worth knowing in advance: the council states that once a project is registered there is a no-refund policy, and that unused inclusions are forfeited on certification.

What does NABERS actually rate?

NABERS rates measured performance, on a scale of one to six stars, from twelve months of verified operational data. The programme publishes separate ratings for energy, water, waste and indoor environment, plus a Renewable Energy Indicator showing the proportion of renewable energy a rated building runs on, and Carbon Neutral certification as an extension of an Energy rating.

For an office building, NABERS states that the Energy rating can be taken three ways:

• Base building, rating central services such as heating and cooling, lifts and lobby lighting.
• Tenancy, rating the space a business occupies within the building.
• Whole building, rating base building and tenant occupied space together, which NABERS notes usually applies where a single tenant occupies an entire building.

Water ratings for offices are taken on a whole building basis. Waste ratings come in base building and whole building forms, the base building version measuring only the waste streams contracted by the building owner. Indoor Environment ratings, covering air quality, lighting, thermal comfort and acoustics, come in base building, tenancy and whole building forms.

The split matters more than it looks. A base building rating can only be produced if the base building load is separately metered from the tenancy load. Submetering is a design decision made by the electrical engineer, usually years before anyone commissions a rating, and getting it wrong is one of the few NABERS problems that cannot be fixed by operating the building better. It is worth confirming the metering strategy against the applicable NABERS rules at design development rather than discovering the gap when the first assessor walks the site.

What does a NABERS rating cost and how long does it last?

NABERS states that paying for a rating has two parts: the NABERS lodgement fee, payable to the New South Wales Government and set regardless of sector or building size, and the accredited assessor’s fee, which assessors set individually based on their own costs. The published lodgement fees sit in the NABERS fees schedule and NABERS states that pricing is aligned to the consumer price index each year, with new prices taking effect on 1 July.

So the honest answer on cost is that half of it is a published government fee and half of it is a quote. The assessor’s fee turns on building size, complexity and how good the records are, which is a fair proxy for how much reconstruction work the assessor has to do. Buildings that meter cleanly, keep utility data in order and know their occupancy hours are cheaper to rate than buildings that do not.

NABERS also publishes discounts that can matter on a portfolio or a first rating, including offers for new builds and first ratings in New South Wales under the Accelerating Net Zero Buildings programme, a discount on a building’s first waste verification, and an offer for data centres that have never held a NABERS Energy rating for data centres.

On duration, a NABERS rating reflects twelve months of energy use and remains valid for one year. That recurring cost and recurring exposure belongs in the operating assumptions of any build to hold model, alongside the other costs that run past practical completion.

How can a new building have a NABERS rating before anyone has occupied it?

It cannot, and that is the whole reason Commitment Agreements exist. NABERS describes a Commitment Agreement as “a contract signed by a developer or owner to commit to design, build and commission a building to achieve a specific NABERS energy rating”.

The agreement is what lets a developer market a number on a building that has never been switched on. NABERS sets out the process and the obligations at each stage:

1. Sign the contract and pay the fee. NABERS counter-signs and the developer has a limited licence to promote the target rating using approved wording.
2. Design, document and model the building to operate at the nominated performance level.
3. Obtain an Independent Design Review report from a member of the Independent Design Review Panel.
4. Submit the report. Once NABERS approves it, the licence becomes a full licence to promote the target rating, including the certificate and logo.
5. Tell NABERS when a construction certificate is granted.
6. Keep NABERS updated through early operation, submitting the occupancy certificate and the date the twelve month data collection period starts.
7. Arrange an accredited assessor to carry out a performance rating when the building is ready, usually after twelve to twenty four months of operation.

Commitment Agreements are available for offices in base building, whole building and tenancy forms, and also for hotels, shopping centres, data centres in infrastructure, information technology equipment and whole facility forms, apartment buildings, residential aged care, retirement living, and warehouses and cold stores.

Two features of that sequence tend to be underappreciated in a development programme. The first is that the promotional licence is staged: limited on signing, full only after the Independent Design Review report is approved. Marketing collateral that leans on a target rating before that approval is leaning on a licence the developer does not yet hold in full. The second is that the obligation runs well past handover. A developer who sells the completed asset has committed to a rating that a different owner will operate towards, which is a matter for the sale contract rather than for the sustainability consultant.

Alongside the Commitment Agreement, NABERS operates an Agreement to Rate, signed at design stage, which the New South Wales planning department describes as having been developed to support applicants to meet the Sustainable Buildings standards. Where the Commitment Agreement commits to a target energy rating, the Agreement to Rate commits to producing the rating. They can run together.

When is a rating mandatory rather than optional?

Green Star is voluntary everywhere. NABERS is mandatory in three broad situations: a Commonwealth disclosure obligation on office transactions, a New South Wales planning standard on large commercial development, and wherever a contract, lease or government accommodation policy imports it.

Selling or leasing office space: the Commercial Building Disclosure programme

The Commercial Building Disclosure programme is the one genuine Commonwealth obligation in this area, and it applies to transactions rather than to construction. The Department of Climate Change, Energy, the Environment and Water states that the programme “aims to improve the energy efficiency of Australia’s large office buildings” and that “in most cases when commercial office space of 1000 m2 or more is offered for sale, lease or sublease the building’s energy information must be disclosed”.

The programme was established by the Building Energy Efficiency Disclosure Act 2010 (Cth), with the Secretary of the department acting as regulator. Section 11 of that Act is headed “No sale, lease or sublease without a building energy efficiency certificate”, and section 15 requires advertisements to include energy efficiency ratings. The Act also carries civil penalty provisions in Part 5, an Energy Efficiency Non-disclosure Register, and provision for both exemptions on application under section 17 and automatic exemptions under section 17A.

A building energy efficiency certificate is built on a NABERS Energy rating for the building, together with a tenancy lighting assessment and general guidance, and certificates are published on the Building Energy Efficiency Register. So the obligation is a disclosure obligation, not a performance obligation: the Act does not say the building has to be efficient, it says the number has to be public before the space is offered.

For a developer, the practical consequence sits on the timing of the first sale or lease. Because the certificate requires a NABERS Energy rating, and a rating requires twelve months of operation, a brand new building cannot produce one at the point it first goes to market. That is precisely why automatic exemptions exist for new buildings, and why the threshold is expressed against the office component in net lettable area rather than gross floor area. Which measure the building is being tested against is worth settling early, because the difference between gross floor area, net lettable area and saleable area is frequently several hundred square metres on a mid-rise office, and 1,000 square metres is a hard line.

Whether a particular transaction is caught, and whether an exemption applies, is a legal question about that transaction. The programme sits alongside the general prohibition on misleading and deceptive conduct, so a marketing claim about a rating that the building does not hold carries its own exposure independent of this Act.

New South Wales: the Sustainable Buildings State Environmental Planning Policy

New South Wales is the only jurisdiction that has written NABERS-aligned standards directly into its planning system for non-residential development.

Sustainability standards for non-residential development took effect on 1 October 2023, under Chapter 3 of the State Environmental Planning Policy (Sustainable Buildings) 2022. The planning department states that the provisions apply to “all new non-residential development with an estimated development cost of $5 million or more or alterations of existing buildings for non-residential use with an estimated development cost of $10 million or more”, with zone-based exemptions described in Chapter 3.1 of the policy.

The department sets out four layers of requirement:

• General sustainability considerations for all development, covering water and energy efficiency and waste minimisation.
• Embodied emissions measurement and reporting for all developments, using either the NABERS Embodied Emissions Materials Form or the NABERS Embodied Carbon Tool, both of which run the NABERS Embodied Carbon Calculator to quantify upfront cradle to gate emissions across life cycle stages A1 to A3. The department states the completed form or tool output must be uploaded to the New South Wales Planning Portal at both the development application and the construction certificate stage, and that the Materials Form must be verified by a suitably qualified professional.
• Minimum energy and water standards for large commercial development, verified after the building is occupied, with offsets purchased for residual emissions.
• Net zero requirements, requiring certain developments to be all electric or capable of converting to operate without fossil fuels by 2035, with a net zero statement verified by a mechanical or electrical engineer. Certain state significant development with health, education and cultural uses is also caught.

The energy and water numbers are not guidance, they are in the policy. Schedule 3 of the Sustainable Buildings policy sets the standards for large commercial development as follows:

• Prescribed office premises: a 5.5 star NABERS energy rating
• Prescribed hotel or motel accommodation: a 4 star NABERS energy rating
• Prescribed serviced apartments: a 4 star NABERS energy rating
• Water use, for all large commercial development: a 3 star NABERS water rating

The dictionary in Schedule 4 then defines what those categories mean: “prescribed office premises means office premises with a net lettable area of at least 1,000m2”, “prescribed hotel or motel accommodation means hotel or motel accommodation with at least 100 rooms”, and “prescribed serviced apartments means a building with at least 100 serviced apartments”. The policy also notes that different standards may apply to the same building where it is used for different purposes, which matters on mixed-use towers with an office podium and a hotel above.

Section 3.3(2) provides that consent must not be granted to large commercial development unless the consent authority is satisfied the development is capable of achieving those standards, and section 3.3(3) states that “development is capable of achieving a standard specified in Schedule 3 if there is a NABERS commitment agreement in place to achieve the standard”. That is the hinge. The Commitment Agreement is not a nice-to-have on a qualifying New South Wales project, it is the mechanism by which consent becomes grantable.

Chapter 3 also carves out a set of zones. Section 3.1(2) excludes development on land wholly in zones RU1, RU2 or RU3, zone E5, zone IN3, zones C1, C2 or C3, and zones W1 to W4, along with development for the purposes of residential care facilities and certain development under the Resources and Energy and Transport and Infrastructure policies. Whether a particular site is wholly in an excluded zone is a title and mapping question worth settling at due diligence, not at lodgement.

Three features of the design are worth sitting with. The standards are verified after occupation, not at certification, so the compliance obligation outlives the construction programme. Residual underperformance is dealt with by purchasing certificates and offsets rather than by refusing occupation, which turns an energy shortfall into a quantifiable cost rather than a stop-work. And section 3.2(2) provides that consent must not be granted to any non-residential development caught by Chapter 3 unless the consent authority is satisfied the embodied emissions have been quantified, not only to the large commercial ones, which means the material quantities have to be assembled twice, once at development application and again at construction certificate.

The embodied emissions layer in particular has a scheduling consequence. Material quantities at development application stage are estimates, and the construction certificate submission has to reconcile with what is actually being built. That is a coordination task between the quantity surveyor, the design team and the builder, and it sits naturally alongside the buildability conversations in a design and construct contract.

The National Construction Code: Green Star and NABERS as compliance pathways

Both ratings appear inside the National Construction Code, not as requirements but as verification methods for showing a Performance Solution meets the energy efficiency performance requirement.

Under Part J1 of National Construction Code 2022 Volume One, verification method J1V1 allows NABERS Energy modelling protocols to demonstrate compliance with J1P1. The Australian Building Codes Board sets the thresholds by class:

• Class 5 buildings: an energy model predicting consumption below 67 per cent of 5.5 stars on the NABERS Energy for Offices base building scale, which the board notes is roughly equivalent to a 6 star rating.
• Class 2 buildings other than sole-occupancy units: below 90 per cent of 5 stars on the same scale.
• Class 3 buildings: below 70 per cent of 5 stars.
• Class 6 shopping centres: below 80 per cent of 4.5 stars.

The board states that in addition to the energy model, “the Verification Method requires a NABERS Energy for Offices base-building Commitment Agreement to be obtained”, and explains the gap between the modelled target and the committed target this way: “it is common industry practice to commit to a lower NABERS Energy rating than is likely to be achieved”, allowing for operational factors outside the designer’s control. A Predicted Mean Vote assessment is also required, to be achieved across not less than 95 per cent of the occupied floor area for not less than 98 per cent of the hours of operation.

Verification method J1V2 does the equivalent job using Green Star. The board states that the project “is required to be registered for a Green Star – Design & As Built rating to confirm its compliance with the Green Star modelling requirements”.

That last sentence is a live trap. Design & As Built is the legacy tool that Green Star Buildings replaced. A project team that assumes the Green Star pathway is available under the current tool without checking how the certifier and the relevant jurisdiction treat the reference is assuming something the code text does not say. Whether that pathway works on a given project is a question for the building certifier and the sustainability consultant together, before the compliance strategy is locked.

National Construction Code editions are adopted on staggered dates by each state and territory, and several jurisdictions have shifted their adoption dates for the 2025 edition. Which edition and which verification methods apply to a particular project therefore depends on where the project is and when the application was lodged. The Australian Building Codes Board publishes the adopted editions and the state variations, and that is the place to confirm the position for a specific project rather than assuming the edition a previous project used.

Councils, government tenants and capital

Beyond the mandatory layer, ratings arrive through three other doors, and none of them are legislation.

Councils set benchmarks in local policy, and it is worth reading closely whether a given benchmark is mandatory or aspirational. The City of Sydney publishes voluntary benchmarks for office development of a 6 star NABERS energy commitment and a Green Star certified rating of 5 star or higher under a current version of design and as built, with a 4.5 star or higher NABERS energy commitment agreement for hotels and serviced apartments. The council states plainly that these benchmarks “are higher than compliance requirements, they are not planning requirements and are not mandatory”, and that mandatory standards sit in the Sydney Local Environmental Plan and the Sydney Development Control Plan. Reading the benchmark page as if it were the control is a common and expensive misreading, in both directions.

Large tenants import ratings through leasing requirements rather than planning instruments. NABERS lists “attracting blue chip and/or anchor tenants, who often value or have requirements for high performing buildings” among the reasons to sign a Commitment Agreement. Government agencies are the clearest example, because each jurisdiction publishes its own accommodation or resource efficiency policy setting the minimum ratings its agencies may occupy, and those policies are revised periodically. Whether a project can realistically target that market is a function of what the current version of the applicable policy says, which is worth reading in the policy itself rather than inferring from a previous project.

Capital markets import ratings through documents. Institutional mandates and investment criteria commonly reference certified ratings as market practice, and the Green Building Council of Australia states that a building meeting the Climate Positive Pathway automatically complies with the Climate Bonds Initiative. Whether a particular capital source treats a rating as a condition or a preference is a question of what the mandate or term sheet says, and the current document is the only reliable source for that.

How do the states and territories differ?

New South Wales is the outlier. Everywhere else, the obligations on a non-residential project come from the National Construction Code and, on office transactions, the Commonwealth disclosure programme, with sustainability standards layered in by councils rather than by a single state instrument.

New South Wales applies the Sustainable Buildings State Environmental Planning Policy described above, with NABERS-aligned energy and water standards, embodied emissions reporting and net zero statements for non-residential development above the cost thresholds, and the Building Sustainability Index, BASIX, for residential development. New South Wales also runs the Accelerating Net Zero Buildings fee offers through NABERS.

Victoria has no equivalent state-wide NABERS-linked standard for commercial development. Planning Victoria states that it has amended the Planning Policy Framework “to include responses to climate change as a new purpose of planning schemes”, with the focus of those changes “on lot and precinct scale developments”, so that all new developments requiring a planning permit must demonstrate how the proposal has considered the relevant environmentally sustainable development policies. Planning Victoria also notes that “local councils in Victoria have local environmentally sustainable development planning policies in their planning schemes”, and that changes under the environmentally sustainable development roadmap will not directly affect those local policies. In practice that means the binding sustainability requirement on a Victorian commercial project is usually a municipal one, and it varies by council.

Queensland, South Australia, Western Australia, Tasmania, the Australian Capital Territory and the Northern Territory do not operate a NABERS-linked planning standard equivalent to the New South Wales policy. On a non-residential project in those jurisdictions the mandatory energy performance obligation is the National Construction Code as adopted in that jurisdiction, and the Commercial Building Disclosure obligation applies to qualifying office transactions nationally because it is Commonwealth law. Councils in those jurisdictions may still set sustainability requirements through their planning schemes, and larger metropolitan councils commonly do.

New Zealand runs parallel systems with the same names and different administration. The New Zealand Green Building Council states that NABERSNZ “is based on the National Australian Building Environmental Rating System (NABERS) and has been adapted for the New Zealand market”, licensed by the Energy Efficiency and Conservation Authority and administered by the council on its behalf. The council states a rating reflects energy use over a twelve month period and remains valid for one year, and that NABERSNZ Energy allows base building, tenancy and whole building ratings, with NABERSNZ Water available on whole building ratings only.

New Zealand certification fees are published rather than quoted. The council lists a single NABERSNZ Energy or Water rating at $2,000 plus goods and services tax, a combined Energy and Water rating at $2,900 plus goods and services tax, and a small buildings fee of $1,000 plus goods and services tax, with small buildings defined by sector, including offices under 2,000 square metres of rated net lettable area on a whole building or base building rating. A $300 discount may apply on re-ratings or where three or more ratings are registered at once. Those figures are in New Zealand dollars and the council notes that certification fees are subject to change.

On the demand side, the New Zealand Green Building Council states that from 2021 the New Zealand government has required all government offices above 2,000 square metres to have a base build rating by December 2025, with a tenancy rating also required at or above 5,000 square metres, agencies entering or renewing a lease to achieve a minimum of four stars, and agencies planning a new build project to achieve a minimum of five stars. The council points to the government property group’s published energy efficiency standards as the source, and that policy is where to confirm the current position. Green Star operates in New Zealand through the council’s own tools, including Green Star Buildings NZ, alongside Homestar for housing.

What do Green Star and NABERS do to a feasibility?

They touch the cost line, the programme, the risk allocation in the building contract and, on a hold asset, the exit. The mistake is treating them as a line item rather than as four separate effects.

Where the cost sits

The certification fee is knowable at concept design because the Green Building Council of Australia publishes it against contract value, and the NABERS lodgement fee is a published government fee. Everything else is a quote.

The larger figures are the design and construction uplift and the consultant team. Facade and glazing performance, mechanical plant selection, electrification of heating and hot water, submetering, commissioning scope, materials with the required certifications, and the documentation effort to evidence all of it. Those are priced by the builder and the design team, and they scale with the target rather than with the building. The step from a code-compliant building to a 4 star outcome is generally a different order of cost from the step from 4 star to 6 star, and the Climate Positive Pathway sits in the second step.

The trap here is sequencing. A rating target adopted after design development, or worse after tender, is the expensive version of the same target, because the cheap levers are orientation, form, facade ratio and services strategy, and those close early. A target carried through the total development cost from concept is a different number from the same target bolted on later.

Where the programme risk sits

The risk is that the rating is earned after the developer has left. A Green Star certified rating follows construction and can be closed out inside the development programme. A NABERS performance rating cannot, because it needs twelve months of real data, and under a Commitment Agreement the obligation carries through early operation to a rating the developer may not be present for.

That makes the building contract and the sale or lease documents the place where the exposure is actually managed. The questions are who bears the consequence if the building is commissioned to specification but operates below the committed rating, what the builder’s obligations are for tuning and commissioning after practical completion, what the defects liability period covers in relation to building management systems, and what happens if the shortfall traces to how the building is being operated rather than how it was built. None of those are questions a sustainability consultant can answer, and all of them are answered in the contract.

There is also a performance gap issue that the Australian Building Codes Board acknowledges openly in the National Construction Code guidance, noting that common practice is to commit to a lower rating than the modelling predicts precisely because operational factors sit outside the designer’s control. A target that leaves no headroom between the model and the commitment leaves no room for the way the building is actually run.

What it may do to value

The Green Building Council of Australia publishes figures on the performance of Green Star rated assets, citing 16.4 per cent higher capital value per square metre, 13.5 per cent higher annual return, and a 23 per cent longer weighted average lease expiry, drawn from its own 2023 research. Those are the scheme owner’s figures about its own scheme, which is worth holding in mind, and they describe a market average rather than a particular asset.

What can be said more carefully is that the ratings change the pool of counterparties. A building with no NABERS Energy rating cannot be offered into a government tenancy that requires one, cannot satisfy a fund mandate that references one, and on an office transaction above the disclosure threshold cannot be marketed at all without the certificate. Whether that translates into a tighter exit yield on a particular asset is a valuation question, and it is one to put to the valuer with the rating assumptions stated, alongside the rest of the capitalisation rate discussion, rather than an uplift to assume in the model.

On a hold asset there is also a recurring cost and a recurring exposure. The rating has to be re-earned annually, the assessor has to be paid annually, and a rating that slips is visible on a public register. That belongs in the operating assumptions, not in a one-off development cost line.

What to ask your sustainability consultant

These are the questions that decide the topic on a specific project, and they are the ones a guide cannot answer:

• Which Green Star rating tool and version would this project register under, and what are the Climate Positive Pathway requirements attaching to that registration date?
• What does the step from a 4 star to a 5 star outcome cost on this building, expressed as a construction cost and a design fee, and which credits drive the difference?
• Which credits on this project are at risk of being lost between design and as-built, and what has to be written into the specification to protect them?
• Is a Green Star Designed assessment worth taking on this programme, given when we intend to market?
• If we take the National Construction Code Green Star verification pathway, how does the reference to Design & As Built in J1V2 apply to a project registering under the current tool, and has the certifier confirmed that position in writing?
• What NABERS Energy rating does the modelling actually predict for this design, and what rating would you commit to under a Commitment Agreement, and why is there a gap?
• On a New South Wales office project, what does the design have to do to make a 5.5 star NABERS energy rating genuinely achievable in operation, rather than achievable only in the model?
• What submetering configuration does the design need to support a base building rating, and does the current electrical design provide it?

What to ask your NABERS accredited assessor

• What data does this building need to produce a rating, and which of it does not currently exist or is not being collected?
• When is the earliest this building could be rated, counting forward from the date the twelve month data period can start?
• What are the realistic risks to the rating that come from the way the building will be operated rather than from the way it was designed?
• What is your fee for the first rating and what would subsequent ratings cost?

What to ask your lawyer

• Does the Commercial Building Disclosure obligation apply to this transaction, and if the building is new, which exemption are we relying on and for how long?
• How is the office component measured for the 1,000 square metre threshold on this building, and does our measurement stand up?
• Under the sale contract, who carries the Commitment Agreement obligations after settlement, and what happens if the purchaser does not operate the building towards the committed rating?
• Under the building contract, what is the builder’s liability if the completed building does not achieve the committed rating, and how is that separated from operational causes?
• What can we say in marketing material about a target rating at each stage of the Commitment Agreement licence, and what wording has NABERS actually approved?
• In New South Wales, what happens if the post-occupancy verification under the Sustainable Buildings policy shows a shortfall, and who bears the cost of the certificates or offsets required to close it?

What to ask your quantity surveyor and services engineers

• What is the cost of the rating target in the cost plan, separated from the base building cost, and how confident is that number at this design stage?
• For the New South Wales embodied emissions reporting, who is assembling the material quantities at development application stage and who reconciles them at construction certificate stage?
• What does the commissioning and tuning scope need to look like to give the building a fair chance at the committed rating, and is it priced?

The short version

Green Star is a voluntary certification of how a building was designed and built, awarded on documentation, run by the Green Building Council of Australia, priced on a published scale against contract value, and closed out within the development programme. NABERS is a government measurement of how a building actually performed, awarded on twelve months of meter data, valid for a year at a time, and mandatory on qualifying office sale and lease transactions under Commonwealth law and on large commercial development in New South Wales under the planning system.

The decisions that determine both are made early: which tool and version to register under, what rating to commit to, how the building is metered, and who carries the obligation after the developer has moved on. The consultants can model all of it. Only the contract decides who pays when the building does not perform the way the model said it would.