To LEED or Not to LEED—That Is the Question

I read an article recently on the Atlanta Journal Constitution’s website in which representatives from local property management firms expressed opinions about the costs v. benefits of applying for LEED certification for their buildings and projects.

Some of the property managers that were quoted in the article said that they did not seek LEED certification—even for buildings that would likely meet LEED standards—because the costs of filing for the certification were too high.  Additionally, they state in the article that they don’t believe that they have lost any tenants for non-LEED buildings.

As an alternative to LEED certification, some of the property management firms are seeking other green building/energy efficiency certifications such as Energy Star ratings.  In some instances, the property management firms themselves have developed their own “green building” promotional branding, which highlights the sustainable and efficiency characteristics of the property.

Of course, all of the property management firms identified in the article have embraced LEED buildings to some extent within their businesses and portfolios—even those firms whose property managers felt that LEED certification costs were too high for some projects to be of value.  So, obviously none of these firms have completely

Do you agree that LEED certification costs are too expensive to be of value to property management firms or building owners?

 

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Good News for Green Building

Engineering News-Record (ENR) recently reported in its July 5, 2010 issue that revenue from projects registered with and actively pursuing green building certification by a third-party sustainable-design standard organization–like LEED and Energy Star–rose 16.8% in 2009 for ENR’s Top 100 Green Design Firms.  According to ENR, the total revenue from these projects rose to $3.3 billion, up from $2.85 billion in 2008, and includes both private and public projects, though revenue was largely generated from private sector markets such as retail, hospitality, multi-unit residential and health care.  This is pretty remarkable given that funding for private construction projects has all but disappeared since the banking industry bailout and since the recession hit the development and construction industries like a “ton of bricks.” (pun intended)    

 It would be reasonable to expect that the demand for green building and third-party certifications would decrease during these tough economic times because of the additional cost associated with green building and sustainable certifications.  So, why is green building bucking the recession trend?  Here are my thoughts:

• Owners are taking advantage of tax credits and other government economic incentives designed to promote reduced energy use and encourage alternative energy production
• Owners are recognizing that green building is not simply a status symbol or marketing tool to lure tenants—they are understanding that the implementation of many of these green building initiatives will reduce energy and operating costs
• The cost to build green has come down—the old notion that green building was significantly more expensive than traditional design and construction techniques is no longer true
• More state and local governments are including green building rating systems in their building codes for both public and private construction

There are probably many more factors that have contributed to the rise in green building revenue despite the recession, which I haven’t mentioned.  What all of this tells me is that we are thinking green now.  Green building initiatives are becoming the baseline for design and construction rather than extraordinary and unique features. 

 Do you believe that green building and sustainability is the new way of doing business for the design and construction industries?