SA’s green building costs decrease while investment returns increase: 2025 Report

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11-09-2025
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Property Wheel
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The Green Building Council of South Africa (GBCSA), in partnership with the Association of South African Quantity Surveyors (ASAQS) and the Department of Construction Economics at the University of Pretoria, have launched the 4th Edition of the internationally acclaimed research study, Green Building in South Africa: A Guide to Costs and Trends – a definitive study on the cost of green-certified buildings, using empirical building costing data to understand how little going green truly costs and the ways in which the market for sustainable properties is changing.

For the first time, 2025’s report connects the costs to the investment performance of certified buildings, delivering a clear ‘Green Building Business Case’.

“Property owners need to understand that certification isn’t the end goal. It’s how you prove that a building is performing in practice and on paper. It gives owners, investors, and tenants confidence that a building will deliver environmental and financial value over time,” says CEO of GBCSA, Lisa Reynolds.

The 4th Edition builds on prior research and begins to explore the data around green investment returns as well as green costs – supported by data from the MSCI South African Green Annual Property Index. It expands on subject matter of previous editions to bring both green cost and green returns together into the flagship business case for green buildings.

The report is based on empirical costing data from 199 Green Star certified office buildings, covering a range of certification levels, project sizes and locations.

“The study confirmed a very modest and constantly declining green building ‘cost premium’ (GBCP) that totally refutes the often-held perception of an unaffordable cost of green building. Green certification and the GBCP also unlock the superior operational performance of green buildings for property owners, as repeatedly confirmed by MSCI Property Index,” comments Dr Danie Hoffman, Lead Researcher, Department of Construction Economics at the University of Pretoria.

The report also reflects that the average green cost premium for office projects certified between 2022 and 2024 has positively decreased from 3.15% for the previous period (2019 to 2021) to 2.40% according to Georgina Smit, Head of Technical and Executive of GBCSA.

“The average since 2009 for the green cost premium as expressed by the median has reduced from 5.95% to 3.43%. But what is particularly pleasing is that there is now clear evidence that these green buildings are more profitable in the long run, so it is an investment that just makes business sense,” she adds .