RPM Case studies

The following case studies highlight some of the successes of our RPM programme over 2007/8. These have been achieved through a wide range of initiatives and processes implemented by us, our consultants and our PM’s.

Risk & Safety Management
Energy Management
Waste Management
Total Building Management and Occupier Engagement

Risk & Safety Management
As part of our Risk and Safety strategy, each PM’s performance is subject to a two tier audit system. Firstly an annual audit to ensure that they continue to have suitable arrangements and procedures in place at Head Office to fully comply with their various obligations.

Secondly, site specific audits are undertaken at managed properties throughout the year to ensure that these arrangements and procedures have been properly implemented at site level. Quarterly performance meetings with each PM ensure that activities are reviewed and monitored regularly.

The site audit process addresses asset protection issues, together with statutory compliance in respect of engineering inspections and management of health and safety and potential contamination/pollution issues.

To assist in the management process we invested, in 2005, in E-workbook, a “state of the art” web-based risk management system which is accessible to all PM’s and which provides a repository for reports and documents and also produces up to date reports on all essential information. This is now paying dividends as it enables us to closely monitor our overall performance.

Energy Management
In 2006 we set our PM’s the challenge of ensuring that for all properties for which they procure and manage energy, they should have real and accurate consumption data that must be reported to Hermes on a quarterly basis. In respect of all properties where the PM procures utilities on behalf of the occupier and recovers the cost, this consumption should be metered.

In working towards meeting these requirements, our PM’s have implemented a number of improvements to their management and reporting processes. One of most significant of these, which we at Hermes have recognised, is the level of detail at which they report on, analyse and act to improve the performance of properties. It is clear that many of them now have a much better understanding of why certain trends occur, document these findings, and identify opportunities for improvement.

Jones Lang LaSalle for example, has implemented a rigorous regime of analysing all our Central London Offices’ utilities performance. They then log Sustainability Improvement Requirements every quarter which enable us to track why properties have improved or worsened. Similarly, King Sturge has a rolling programme across all our multi-let provincial offices, and by using half hourly metering, they track the energy profiles of the buildings. This information is then used to identify potential improvements that can be made in running the plant more effectively.

In addition to efficiency improvements, we also set our PM’s the requirement to ensure that all new or amended energy contracts are Climate Change Levy¹ exempt, if the price is within 10% of conventional supplies. Both Jones Lang LaSalle and King Sturge have had success with this, and we are pushing other PM’s to source cleaner sources of energy. (see our performance section for more information).

1: The Climate Change Levy applies to energy in the non-domestic sector. Energy that is exempt from the Climate Change Levy includes electricity from renewable sources and combined heat and power. Click here for more information.

Waste Management
Our PMs made great strides in this area during 2007 and 2008. The performance results are evidence of this good work, with a portfolio-wide recycling rate (for those properties that measure by weight) of 43%. (see our performance section)

Successes such as that at Atrium Court (see opposite) are common across many of our properties, and we continue to push our PM’s to achieve these high standards across our portfolio. See more examples of best practice waste management in our RPI Centres of Excellence.

A significant challenge our PM’s face with regard to waste management is the level of service provision available. While the waste industry is improving, it is still evident that many companies are not able to provide the level of service we require. To further assist our PMs in choosing more favourable waste providers, we have populated our interactive map with the locations of material recovery facilities, and further, have indicated how effective those sites are not only at providing the level of service we require, but also at indicating what level of recycling is achieved post-sorting. (see our interactive map for more information).

By having this information to hand, our PM’s can have an even better understanding of what happens to the waste once it leaves their control, and demonstrates a commitment to go one step beyond our immediate responsibility.

Total Building Management and Occupier Engagement
As outlined in our 2007 report, property management arrangements differ from building to building. For example, in terms of energy consumption, the amount of landlord provision can vary greatly. In some of our assets our PM’s purchase all the energy for the building and then charge it back to the occupiers (based either on a floor area basis, or preferably a metered basis). In some buildings however, our PM’s only purchase energy for the common parts areas of the building, which for some of our assets might just be car park lighting or a security hut, and for our FRI properties, none at all. We therefore have very different levels of control over how that energy is used.

We are actively seeking to establish closer relationships with our occupiers – raising the awareness of RPI and pushing for joint initiatives to improve the performance of our assets. (see our Occupiers section for more information)

In addition to this, we are also looking for opportunities to maximise savings and efficiencies by taking more control over the utilities and waste management of a building. What we are calling Total Building Management (TBM) not only gives us a higher level of control and therefore allows us to make greater absolute savings, but it often allows for more favourable contracts to be agreed due to economies of scale, which in turn offers financial benefits to us and our occupiers. We have already had some success in this area, such as at 10 Bedford Street where a new waste contract was agreed for the whole building, allowing us to offer the occupiers an improved service for 40% less cost.