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The purpose of this paper is to investigate if a green lease could eliminate the split incentive problem in two office buildings located in Stockholm, Sweden. It aims to provide a theoretical overview concerning the “energy paradox” and to describe a case study in which a green lease was to be implemented in the legal framework for two office buildings in the Stockholm region.

This paper documents a case study, in which a green lease was to be implemented in the legal framework for two office buildings, to promote a more active engagement in the buildings energy performance. In order to accomplish this, a project group was formed which consisted of representatives from the building owners, tenant, property manager, energy consultants and KTH, Royal Institute of Technology, Stockholm.

This paper reveals that it is very hard to alter already legally binding agreements. Furthermore, it shows that the separation of ownership and usage of a building may not be optimal from an energy efficiency point of view.

The paper gives an empirical explanation as to why at times energy efficiency measures are not undertaken, even though the investments themselves bring about a positive net present value. In addition, the paper analyses the situation where property maintenance is outsourced to a property management firm, which is a common but seldom discussed situation in the literature.

Compares the way women are taxed in the Germany, Sweden and The Netherlands by looking at both macro and micro data from the perspective of a wife′s contribution to family income. The programs used for analysis are included in an appendix. Taxing husbands and wives by adding joint incomes and dividing by two (as in Germany) penalises dual‐earner couples and favours one‐earner couples. Completely separate taxation (as in Sweden) is a major incentive for couples to be dual‐earner. In The Netherlands the government reform of the tax system (1990) has reduced negative tax effects on secondary earnings without introducing the positive effects seen in Sweden. Tax incentives are not the only determinant of women′s participation in the labour market.

The Recast Energy Efficiency Directive 2023 has defined the concept of “split incentive,” also known as “tenant-owner dilemma.” This dilemma refers to the situation where neither landlords nor tenants have incentives to invest in energy efficiency upgrades. Although the Energy Efficiency Directive calls Member States to overcome legal barriers to remove split incentives and to encourage retrofits, the list of possible measures is too vague. This paper aims to discuss tenancy law measures designed to increase the energy efficiency of residential housing and to detect which Member States have already addressed this phenomenon.

This paper analyses, from a civil legal perspective, the possible private law barriers arising from the tenant-owner dilemma when performing energy efficiency works in selected countries and proposes legal reforms in tenancy law and related policies to overcome them. To do so, this paper follows a legal-dogmatic and comparative law methodology.

This paper concludes that some tenancy law provisions, such as the possibility to increase the rent after energy efficiency renovations and long-term leases, may challenge the tenant-owner dilemma in private rented markets, thus promoting renovations and retrofitting for energy efficiency purposes. It also proposes other policies intended to increase parties’ willingness to undertake works.

More research on the economic and legal efficiency to regulate some of the civil law measures to challenge the tenant-owner dilemma should be necessary.

The civil law measures included in this paper may help national policymakers meet the energy efficiency targets, according to what is established in the Recast Energy Efficiency Directive 2023.

Based on the economic theory of the tenant-owner dilemma, this paper investigates the elements of tenancy law that may contribute to less energy-efficient homes, proposing policies for those countries interested in addressing the energy-efficiency challenge from a private law point of view.

A green lease incorporates sustainability practices to reduce a building’s negative impact on the environment. Facilities managers play an important role in ensuring these best practices are implemented during the operational stage of a building; however, green leasing is an under-researched area in the emerging field of sustainable facilities management (SFM). This paper aims to investigate the common barriers encountered in ensuring environmental performance when a green lease agreement is in operation between a landlord and tenant.

This research was conducted in three stages using the principal-agent problem as the theoretical foundation for data collection. Stages 1 and 2 used semi-structured interviews to collect data with policy/corporate-level professionals, landlord and facilities management representatives who have considerable experience in green leases. Stage 3 used document reviews based on summative content analysis to further evaluate the extent of the contextual use of green leasing concepts as used within the facilities management community.

The study confirmed a strong incentive gap and information asymmetry between the landlord and facilities manager, forming a typical double principal-agent problem when the split incentives between the landlord and tenants are also taken into consideration, which results in agents acting on their own self-interest rather than the interests of the principal. Goal alignment is found to be key for the successful operation and management of a building throughout its life; when present, these goal conflicts can lead to disharmony between the parties to the contract.

The study proposes a few practical measures to close the gaps in incentive and information asymmetry that create the principal-agent problem, while providing recommendations to the facilities management professional community. These recommendations could be included in future revisions of the SFM guidelines or code of practices used by the industry. Although this study exposed a rather neglected area of the facilities manager’s role in green leases, the findings are limited by the relatively small sample size used for the interviews.

This study contributes to the SFM body of knowledge from a green lease perspective, and the theoretical framework in the double principal-agent problem introduced in the study could be used in future research endeavours.

The purpose of this paper is to investigate whether energy-efficient green buildings tend to provide net lease structures over gross lease ones. It then considers whether owners benefit by trading away operational savings in a net lease structure.

Empirical models of office leasing transactions in Sydney, Australia, with wider transferability supported by analysis of office rent data in the USA.

Labeled green buildings are approximately four to five times more likely than non-labeled buildings to use a net lease structure. However, despite receiving operational savings, tenants in net leases pay higher total occupancy costs (TOC), benefiting owners. On average, the increase in TOC paid by tenants in a net lease is equal to or greater than savings attributed to an eco-labeled building.

A full accounting of TOC in eco-labeled buildings suggests that net lease structures provide numerous benefits to owners that offset the loss of trading away operational savings.

The principal-agent market inefficiency, or “split incentive,” is a widely cited barrier to private investment in energy-efficient building technology. Here, a uniquely broad look at rental cash flows suggests its role as a barrier is exaggerated.

The paper aims to explore the potential impact that the introduction of the UK's carbon reduction commitment (CRC) energy efficiency scheme will have on: energy use in the tenanted commercial built environment; and the idea of the net lease.

The paper reviews various background documents preceding the implementation of CRC in order to identify the abatement incentives established. The common structure of commercial leases and the early property market reaction to CRC are also considered in order to explore how effective the CRC scheme is likely to be in achieving the twin goals of carbon saving and landlord‐tenant collaboration.

Key to the success of the CRC scheme will be the way in which the financial and reputational drivers established by the CRC scheme incentivise landlords and tenants to make technological and social changes to reduce energy consumption. Given the variety of ways that energy is supplied to tenanted commercial property, the complexity of the CRC scheme, the traditionally adversarial relations between landlords and tenants and the “split‐incentive” of commercial leases, energy abatement opportunities are found to be significantly more limited in the leasehold context than for owner‐occupied properties. Nonetheless, the paper notes that the introduction of the CRC scheme has begun an important conversation and is an important step towards tackling energy efficiency.

The paper brings together understandings of the legal framework of commercial leases, of the property market and practice, and the landlord and tenant relationship – to consider how the CRC scheme will help to deliver the UK's goal of reducing carbon emissions.

The purpose of this paper is to extend the literature on the effects of stock splits from mutual funds splits and the QQQ split to 20 exchange traded funds (ETFs) that span a wide variety of indexes. The split sample is compared to a non‐split control sample with similar characteristics between 2000 and 2006. The objectives of this study are to investigate whether the results are different between the split sample and the control sample; and whether these results are similar to other investment vehicles in the existing literature.

The paper examines stock excess returns, total capital, several measures of liquidity, and the premium or discount relative to net present value around the split. It also tests for increases in smaller trades after the split.

The results support the hypothesis that two key management objectives of splitting an ETF stock are to increase demand from retail investors and to increase the total capital under management. Support is also found for the existence of momentum in stock price indexes.

The effects of splits are examined in a larger group of ETFs that includes less‐heavily traded stocks than the QQQ. These smaller ETFs potentially have more to gain in terms of increased investor interest than the QQQ.

Positive excess returns were found in the split ETFs before and after the split. This is consistent with the tendency for stocks to be split following a large price run‐up, and with momentum theory. Also, significant increases were found in total capital under management and shares outstanding after the splits for the splitting stocks. This is consistent with the hypothesis that a key goal of managers is to increase their compensation via higher total capital under management. Finally, significant increases were found in the number of small trades and dollar values of trades as a percentage of all trades (and of total dollar volumes) in the split sample. These results support the hypothesis that a primary objective (and result) of ETF stock splits is to make the shares more attractive to individual investors – despite possible deterioration of liquidity as evidenced by wider bid/ask spreads.

Using a unique data set, the purpose of this paper is to test the hypothesis that tenants pay increased accommodation costs for space in energy efficient office property.

The authors obtain lease contracts for office space in central Sydney, Australia. Empirical data on annual gross face rent and contract terms from each lease are combined with building characteristics and measured energy performance at the time of lease. Hedonic regression isolates the effect of energy performance on gross face rent.

No significant price differentials emerged as a function of energy performance, leading to a conclusion that tenants are not willing to pay for energy efficiency. Six factors – tenancy floor level, submarket location, proximity to transit, market fixed effects, building quality specification and, surprisingly, outgoings liability – consistently explain over 85 per cent of gross face rent prices in Sydney.

Rent premiums from an asset owner's perspective could emerge as a result of occupancy premiums, market timing or agent bias combined with statistically insignificant rental price differentials.

Tenants are likely indifferent to energy costs because the paper demonstrates that energy efficiency lacks financial salience and legal obligation in Sydney. This means that split incentives between owner and tenant are not a substantial barrier to energy efficiency investment in this market.

This study is the first to thoroughly examine energy efficiency rent price premiums at the tenancy scale in response to disclosure of measured performance. It also presents evidence against the common assumption that rent premiums at the asset scale reflect tenant willingness to pay for energy efficiency.

This paper aims to investigate how unique features of built facilities would affect the application of greenhouse gas (GHG) emissions trading, and to explore what adaptive measures may be taken for emissions trading to be applied to the built environment. Emissions trading is a financial tool to encourage GHG emissions reduction in various industries. As the building sector is responsible for a large amount of GHG emissions, it is valuable to explore the application of emissions trading in built facilities.

The analysis is based on a comparative study reviewing the current emissions trading schemes (ETSs) in Australia, Japan and the UK covering the building industry, and to evaluate the approaches adopted by the schemes to tackle the problems related to buildings and facilities management.

The research findings reveal that the small energy savings of individual building units, the large variety of energy-saving technologies and the split incentives and diverse interests of building owners and tenants would be the barriers hindering the development of emissions trading. To overcome these barriers, an ETS should allow its participants to group individual energy savings, lower the complexity of monitoring and reporting approaches and allow owners and tenants to benefit from emissions trading.

This article provides a comprehensive overview of the current emissions trading practices in the built environment. Besides, it raises the attention and consciousness of policymakers to the need that building characteristics and facilities management should be taken into consideration when designing an ETS for the building sector.

The purpose of this paper is to investigate the barriers to the implementation of energy efficiency projects in Canadian universities, including access to capital, bounded rationality, hidden costs, imperfect information, risk and split incentives. Methods to address these barriers are investigated, including evaluating the efficacy of revolving funds.

Senior administrators of 15 Canadian universities were interviewed, making use of both structured and open-ended questions. As university executives and senior technical directors are responsible for investment in energy efficiency at Canadian universities, these individuals were the focus of our study.

The results offer a curious contradiction. While “Access to Capital” was found to be the largest barrier to energy efficiency in Canadian universities, and while respondents agreed that green revolving funds are both an effective method to address these capital funding constraints, and may be an effective method to implement energy conservation projects at their university, only 2 out of the 15 universities interviewed and 7 out of the 98 universities in Canada currently make use of a green revolving fund. A general reluctance at Canadian universities to formalize processes to prioritize energy efficiency limits the associated benefits of mechanisms such as revolving funds to institutionalize energy efficiency and reduce long-term energy use.

To provide insights into barriers to energy efficiency in universities and methods to address them, including the efficacy of revolving funds.

This research is one of the first to investigate the efficacy of revolving funds to confront barriers to energy efficiency. The findings, implications and recommendations are valuable to organizations, university administrators, researchers and practitioners implementing energy efficiency measures.