What are BUFs? And Why Should you Care?
Tuesday 19 June 2018
Building Upgrade Finance (BUFs) is an innovative finance mechanism allowing building owners to repay a loan for upgrades, through Council charges on the land. The financing arrangement can be used for a range of upgrade works to improve the environmental and sustainability performance of existing buildings.
The loan, which is entered into between a building owner and a lender, is secured, making it possible to access capital at competitive rates over a longer term and for larger projects.
This type of funding arrangement is not currently available in Albury, however AlburyCity is seeking feedback from the local business community to determine the level of interest in this program.
Environmental performance improvements can include reducing energy or water consumption and waste generation. More specific examples of investments can include:
- Energy and water efficiency – lighting, heating, ventilation and air conditioning, Building Management System
- Renewable energy - solar
- Reducing greenhouse gas emissions
- Preventing or reducing pollution
- Reducing the use of materials
- Recovery or recycling of materials
- Encouraging alternatives to car travel, such as walking and cycling
BUFs will enable building owners to finance upgrades that will improve environmental outcomes, lower operational costs and improve the capital value of their buildings on a case-by-case basis.
By improving the cash flow and return on investment for the building owner, which is also attractive to finance providers, it will support longer term investment, and larger upgrades that will provide bigger savings.
Financing can be sought for 100% of the capital costs and must be applied to improvements on non-residential buildings (e.g. retail, industrial, office, agriculture etc.) or strata buildings comprising more than 20 residential lots.
The NSW Environment & Heritage site provides further information including additional benefits, eligible upgrades and a great case study on the utilisation of BUF here.
If you would like any additional information in relation to this financing opportunity, please contact Amber Rodd at AlburyCity on (02) 6023 8111.