Real Estate Developers and Green Building Adoption : A Study of the Singapore Mandatory Green Building Policy

Green building (GB) offers technical solutions to reduce the energy use in the building sector. How to implement effective supply-side GB policies, such as the mandatory policies, to spur real estate developers to go green is meaningful for energy saving and sustainability in cities. However, few studies empirically examined the actual effects of the GB policies. This paper investigates real estate developers’ GB adoption under the mandatory GB policy in the Singapore context. Using data from the private housing market, our research design includes a hedonic regression analysis to examine the GB cost premiums and a logit model analysis to scrutinize the factors affecting a developer’s GB adoption and the impact changes before and after the mandatory policy. We find that the mandatory GB policy has limited effectiveness. It effectively promotes a large portion of developers to adopt GBs that merely meet the technical threshold prescribed by the policy but are not certified, but ineffectively motivates them to build certified greener buildings. GB cost premiums and weak corporate financial strength are found to negatively affect the policy effectiveness. The findings are helpful for policymakers to better understand developers’ behaviours in sustainable development and to improve the future government intervention schemes