Building green

There is buzz on Bainbridge about green building, not surprising in an area so concerned with the environment. The following article is instructive.

By CHARLES LOCKWOOD, for the Wall Street Journal

High-performance green, or "sustainable," buildings can be found across the U.S. Offices, schools, stores, factories, hospitals and, increasingly, homes. Even green police and fire stations, convents, pet shelters and car dealerships.
Green buildings aren’t just a U.S. phenomenon. In the U.K., over 95,000 buildings have received "green" certification from the BREEAM (Building Research Establishment Environmental Assessment Method) program, and over 670,000 buildings have been registered for a BREEAM rating What is a high-performance green building? Is it much more than just energy-efficient?"


Green buildings incorporate design, technology and construction practices that significantly lessen their negative impact on the environment through reduced use of natural resources, lower energy and water consumption, and fewer greenhouse gas emissions. They also provide healthier indoor environments for their occupants-you, your family, your co-workers-compared to conventional buildings.
A Fundamental Change
In 2002, only 38 buildings had received a LEED® (Leadership in Energy and Environmental Design) rating from the U.S. Green Building Council (USGBC). LEED is a voluntary green building rating system that measures and verifies the environmental performance of a building. It has four award levels: Certified, Silver, Gold and Platinum.
Just five years later, as of October 1, 2007, 1,326 residential and non-residential buildings had earned LEED ratings, and 16,047 projects had been registered for LEED ratings.
"Looking three to five years ahead, and based on the current trajectory of growth, we should see a 50" increase every year in the number of new-construction buildings that apply for LEED certification," says S. Richard Fedrizzi, president, CEO and founding chair of the USGBC. "By 2010, I expect to see 100,000 commercial buildings involved with LEED . . . and over 1 million homes."
Leading the way toward higher-performance green buildings are corporate and government offices (from the local to the federal level), and schools and universities. Playing a rapid game of catch-up are single and multi-family residences, along with hotels, manufacturing facilities and retail outlets.
"We are in the middle of a major transformation in the real estate market," says Brenna S. Walraven, chairman of BOMA (Building Owners and Managers Association) International. "In no more than 5 years, and maybe in as little as 24 to 36 months, building owners will be at a competitive disadvantage if they aren’t operating green buildings."
Green Drivers
The proliferation of high-performance green buildings is gaining momentum because of several powerful forces.
The most significant driver is the documented financial benefits of green buildings, from lower operating costs, including a 20" to 50" or more reduction in energy consumption, to improved workforce productivity, reduced employee absenteeism, and skilled-worker attraction and retention.
Second, green buildings offer increased profits for real estate owners and investors. According to McGraw-Hill Construction’s "2006 Green Building SmartMarket Report," compared to conventional buildings, green buildings generate 3.5" higher occupancy rates, 3" higher rent rates, an average increase of 7.5" in building values and improved ROI. Many buildings are doing even better.
Upon its early 2006 completion, the 40-story LEED-Silver One South Dearborn Street building was already 93" leased in downtown Chicago’s soft market, which had a 14.3" vacancy rate. One Crescent Drive, a four-story LEED-Platinum office building in the Philadelphia Navy Yard Corporate Center, has rental rates that are 25" to 50" above the market average.
Some green buildings are selling at impressive prices. In 2006, Hines sold the One South Dearborn Street tower to the Olen Properties Group for $344 million, a profit of $144 million over construction cost.
A third driver is the growing concern about both global climate change and rising energy prices to heat and cool our buildings. Green buildings address both issues.
Fourth, the formation of the U.S. Green Building Council in 1993 and the launch of its LEED green building rating program in 2000 gave the U.S. a national green building definition and rigorous standards that have assured buyers and renters that a building is really high-performance and sustainable, not just tagged with a "greenwashed" marketing label.
Fifth, cities, states and utility companies have been offering a wide variety of incentives-from tax credits to density bonuses and expedited approvals-to encourage energy-efficient and green building development and renovations.
Finally, a growing number of building regulations have been mandating green development, first in the public sector and now, increasingly, in the private sector.
Debunking the "Green Costs More" Myth
Most people still believe that it costs substantially more to construct a green building than a standard building. That was true 10 years ago, when green buildings in the U.S. were still experimental, but not any longer.
As recent studies have shown, LEED-Certified, LEED-Silver and, increasingly, LEED-Gold buildings cost no more-and sometimes less-than comparable conventional buildings. PNC Financial Group and Wachovia have both embarked on major green bank branch construction programs. Each of these LEED-Certified branches cost Wachovia $80,000 less and PNC $100,000 less to build than comparable conventional bank branches.
"Green premium" no longer means higher-cost green buildings. Today it means higher property values, lower operating costs, and health benefits for building owners and tenants.