In Singapore’s evolving real estate landscape, ESG (Environmental, Social, and Governance) is no longer just a compliance issue, it is a cornerstone of value creation and risk mitigation. For landlords navigating the commercial real estate Singapore market, future-proofing assets means embedding sustainability into both building design and operational frameworks. From strata office Singapore investments to large mixed-use developments, aligning with ESG principles enhances asset performance, attracts top-tier tenants, and ensures long-term capital appreciation.

This guide presents a comprehensive strategy for commercial property owners to adapt to market demands, comply with rising regulatory expectations like the Green Mark certification, and position themselves for investor scrutiny in a rapidly greening economy.

Your Property is Your First Line of Defence

In an age of climate risk, shifting work paradigms, and investor scrutiny, your building is more than a space, it is a strategic asset. In commercial real estate Singapore, property selection and management now play a central role in ensuring business continuity, brand value, and regulatory alignment.

Tenant and investor preferences are shifting rapidly. In fact, green-certified Grade A offices in Singapore command rental premiums of 4% to 9%¹, with elite assets achieving as much as 15% to 20% above market averages². On the flip side, properties that lag in ESG real estate standards face “brown discounts” of up to 30%³, along with rising vacancy risk and stranded asset status³.

This guide gives landlords a practical playbook to understand ESG demand, align with evolving policies like the Green Mark certification, and create competitive resilience in commercial real estate Singapore.

The Tenant Mandate: Why ESG Attracts and Retains Top Occupiers

Talent and Brand Alignment

Tenants, especially multinational corporations (MNCs), now use office environments as strategic tools to attract top talent⁴. In a post-pandemic economy where hybrid work, mental well-being, and flexibility matter, office buildings must reflect company values. ESG-certified buildings project care for employee health, environmental impact, and social responsibility - key traits for companies seeking both talent and reputation alignment.

Meeting Net-Zero Commitments

Over 70% of major corporations in Asia-Pacific have committed to net-zero⁵ or emissions-reduction targets. Leasing space in a certified green building is a direct lever for reducing operational carbon footprints. This has led to growing demand for Green Mark Platinum and WELL-certified offices within Singapore.

Wellness and Indoor Experience

Post-COVID, the “Social” element of ESG is taking centre stage⁶. Tenants now demand improved indoor air quality, natural lighting, touchless systems, and wellness facilities. These directly impact productivity and retention, especially in white-collar industries where human capital is the greatest asset.

The Cost of Obsolescence

Landlords who fail to upgrade risk more than empty space, they face long-term value erosion. The brown discount is real: buildings without ESG upgrades may suffer up to 30%³ value gaps against high-performing peers.

A Landlord's Framework: Navigating Singapore’s ESG Landscape

Step 1: Align with Regulatory and Financial Drivers

Green Mark Certification: The Baseline

The Green Mark certification⁷ by Singapore’s Building and Construction Authority (BCA) is the gold standard for ESG real estate in the city-state. Whether it's a new launch or a retrofit, certification is no longer optional. Landlords seeking tenants or buyers, especially institutional funds, must secure at least a Green Mark Gold to stay competitive⁸.

Mandatory Energy Improvement (MEI): Coming in 2025

Starting in Q3 2025, owners of energy-intensive commercial buildings will be subject to mandatory audits and retrofits under the MEI framework⁹. Proactive compliance not only avoids penalties but also allows asset owners to unlock grants or incentives while preparing for long-term performance expectations.

Energy Efficiency and Savings

Green-certified buildings consume 30%–60% less energy¹⁰, according to market studies. These savings benefit both landlords and tenants, improving net yields and lease appeal.

Read more: See a direct comparison of Green Mark vs. traditional building operational costs.

Investor Pressure and Market Liquidity

More than 70% of institutional investors in Asia-Pacific plan to increase exposure to sustainable assets. ESG real estate is more marketable, liquid, and aligned with fund mandates¹¹, offering landlords an edge in refinancing, resale, or asset repositioning.

Read more: Understand how this fits into broader Singapore office leasing trends.

Step 2: Tailor Your ESG Strategy by Asset Type

Strata Office Singapore & Medical Suites

Strata offices are typically occupied by SMEs, medical groups, or professional firms. Tenants in this sector value high indoor air quality, energy savings, and smart technology—but they also seek prestige and trust.

• Install smart HVAC systems with air purification
• Prioritise WELL Building standards alongside Green Mark
• Highlight these features in marketing to attract tenants in legal, finance, or medical sectors

Read More: Future-Proofing Your Strata Office Investment

Hotels

For hotels, sustainability is part of the brand story. Guests—and corporate travel programs—are increasingly eco-conscious.

• Invest in solar panels, water-saving systems, and visible green features
• Use certification (e.g., Green Mark, LEED) as part of your marketing narrative
• Embrace circular design in renovations

Read More: How ESG is Reshaping the Hospitality Landscape

Shophouses

Often heritage-protected, these assets require creative ESG adaptation.

• Use sustainable retrofitting methods that protect architectural integrity
• Integrate solar panels discretely
• Activate spaces for community use or pop-ups to drive “Social” value

Read More: Enhancing the Value of Your Shophouse Portfolio

Industrial Buildings & Land

With large rooftops and longer leases, industrial properties are ESG workhorses.

• Install rooftop solar systems, now often mandated for certain JTC sites
• Enable EV infrastructure and high-efficiency M&E systems
• Design for automation-ready operations with future-proof layouts

Read More: Discover the 3 key considerations when purchasing green industrial buildings

Read More: A Guide to Developing Sustainable Industrial Assets

Your Next Move: Securing a Future-Proofed Asset

In the competitive landscape of commercial real estate Singapore, ESG is not just a differentiator—it is a baseline. Whether you're managing a strata office Singapore unit or a multi-storey commercial development, embedding sustainability is now a financial, regulatory, and strategic necessity.

Landlords who take the lead today will enjoy:

• Higher tenant retention
• Premium rental yields
• Lower operational costs
• Increased asset value and liquidity

An ESG strategy is no longer optional, it is essential for long-term value. Navigating the requirements for your specific asset requires expert guidance. Our team provides data-driven advice to align your property with market demands, ensuring it remains competitive and profitable.

Contact Savills Singapore today to develop a bespoke ESG strategy that unlocks the full potential of your commercial property.

Footnotes

¹ Source: BCLP. https://www.bclplaw.com/en-US/events-insights-news/greening-real-estate-understanding-the-green-premium-in-corporate-real-estate-manda.html
² Source: The Edge Singapore. https://www.theedgesingapore.com/news/sustainability/do-green-buildings-really-enjoy-higher-rents-and-lower-costs
³ Source: GuocoLand / The Business Times. https://www.guocoland.com.sg/Documents/News/2024/BT_1_Jan_2024_pg_13.pdf
⁴ Source: Savills. https://www.savills.com/prospects/themes-sustainability-matters.html
⁵ Source: Bank of Singapore. https://www.bankofsingapore.com/research/building-green-offices.html
⁶ Source: Brigade Group. https://www.brigadegroup.com/blog/commercial/esg-in-commercial-real-estate
⁷ Source: Savills. https://www.savills.com.sg/blog/article/224666/singapore-articles/what-sets-high-performing-green-mark-commercial-buildings-apart--strategies-backed-by-real-project-insights.aspx
⁸ Source: Ministry of National Development. https://www.mnd.gov.sg/our-work/greening-our-home/bca-green-mark
⁹ Source: The Straits Times. https://www.straitstimes.com/singapore/politics/owners-of-energy-intensive-buildings-must-reduce-energy-consumption-under-changes-to-law
¹⁰ Source: The Edge Singapore. https://www.theedgesingapore.com/news/sustainability/do-green-buildings-really-enjoy-higher-rents-and-lower-costs
¹¹ Source: EXPO REAL Asia Pacific. https://exporealasiapacific.com/insights/how-sustainable-real-estate-investment-is-gaining-ground-in-apac/