Green leases are commonly understood to refer to lease contracts that include provisions on environmental sustainability to ensure that the use of a building or an establishment has the least impact on the environment. We are not aware of any Philippine law or regulation that mandates green leases.

There is also no publicly available information on the extent of the take-up of green leases in the Philippines. However, based on market reports generated by leading property consulting firms in the Philippines, green leases appear to be an emerging trend in property rentals, as more and more landlords include green lease provisions in lease contracts.

Notwithstanding the above, it is worth noting that there are voluntary mechanisms by which green leases are promoted in the Philippines.

LEED certifications are gaining traction in the Philippine real estate industry, albeit also being an optional certification. As mentioned in the “Green certification” section, a LEED certification is issued to buildings to determine compliance with standards set by the GBCI. In particular, these standards track a building’s compliance with standards on sustainability, water efficiency, indoor environmental quality, innovation, materials and resources used, location and transportation, regional priority, integrative process, and innovation.

As of 2023, a total of 23 projects have been issued with LEED certifications in the Philippines.

In relation to green leases, it appears that green lease provisions are required before a landlord can obtain a LEED certification for a building. Under Version 4 of the LEED guidelines, owners of new constructions are required to declare that they are vying for LEED certifications and recommend best practices for a tenant to comply with LEED standards before signing any lease contract. Thus, if a building in the Philippines intends to obtain a LEED certification, green lease provisions appear to be required in its lease provisions.