Sorry, your browser is out-of-date!

Update your browser to view this website correctly.

Microsoft no longer supports Internet Explorer. Please download their replacement Edge or another modern browser such as Chrome, Safari or Firefox. This site will not be fully functional using Internet Explorer.

Cc header graphic v2

Building Upgrade Finance is a finance product to assist building owners with environmental upgrades to non-residential buildings, and with restoration and upgrades to heritage buildings.

Under Building Upgrade Finance, an agreement between the building owner, finance provider and local council is entered into, where a:

  • building owner seeks finance for a building upgrade;
  • finance provider lends finance to the building owner;
  • council collects repayments from the building owner and transfers them to the finance provider.

The finance structure, including local councils, provides finance providers with additional security that enables unique product benefits, such as:

  • long term loans (10-20 years),
  • fixed interest rates,
  • ability to transfer the repayments on sale of land, and
  • the ability to share costs and benefits with tenants.

This is due to the loan being tied to the property, rather than the building owner, through the local government charge (Building Upgrade Charge) used to collect repayments. This means in the event of default this charge is ranked senior to mortgages, taxes and other charges.

More information on Building Upgrade Finance, including successful projects, is on the Building Upgrade Finance website.

Click here to find out which South Australian councils have Building Upgrade Finance available in their local area.

The Building Upgrade Finance Central Facilitator is available to assist key stakeholders across the state, including local government, finance and property sector stakeholders, with Building Upgrade Finance. For further information please contact:

Building Upgrade Finance Central Facilitator for South Australia
P: (08) 8203 7884


Building Upgrade Finance is designed to tackle market barriers that often impede non-residential building upgrades from going ahead. These barriers include access to the capital to fund upgrade projects, and the split incentive between landlords and tenants in leased buildings, where the building owner incurs the cost of the upgrade, but the tenant receives the benefits through reduced utility bills and improved accommodation. Building Upgrade Finance addresses these barriers by providing 100% project finance for upgrades and enabling tenant contributions to the costs.

The enabling legislation for Building Upgrade Finance in South Australia and the supporting regulations came into operation on 1 August 2017. Similar schemes are established in Victoria (known as Environmental Upgrade Finance) and New South Wales.

There are a number of templates and resources that can assist interested parties to use Building Upgrade Finance. Please contact the Central Facilitator to understand the process and requirements.

Tenant Contribution

In South Australia, building owners have two pathways for collecting contributions from tenants.

  • ‘No worse off’ pathway
    Where upgrade works deliver financial benefits to the tenant (i.e. through utility bill savings), the building owner may be able to collect a contribution to the Building Upgrade Finance repayments from the tenant without their explicit consent. This is only an option if the contribution doesn’t exceed the utility bill savings to be made by the tenant from the upgrade works; or
  • Consent Pathway
    The tenant and building owner negotiate and the tenant agrees to pay a contribution to the Building Upgrade Finance repayments. This may apply where the ‘no worse off’ pathway is ineligible (e.g. heritage upgrades).

If the ‘no worse off’ pathway is followed to recover contributions from tenants, the building owner is required to use the government-approved methodology to estimate tenant cost savings to ensure the tenant is not financially disadvantaged. It is recommended that suitably qualified individuals with relevant experience be engaged to undertake calculations. A guide was also developed to help property stakeholders, consulting engineers and service providers understand the purpose, eligibility and application of the approved methodology.

The ‘No Worse Off’ Methodology for Estimating Tenant Cost Savings (the Methodology) was gazetted on 8 August 2017 and provides for a robust pathway to estimate tenant cost savings whilst minimising the costs associated with its application.

Tenant contributions under both pathways can be recovered without having to renegotiate existing lease agreements, and are considered to be an outgoing expense in a lease.

For more information, please see the Frequently Asked Questions – Tenant Contributions.

Find out more