Posts Tagged ‘LEED’

Chicago Mayor Richard M. Daley To Receive Legacy Award for His Sustainable City

Thursday, October 14th, 2010

Chicago Mayor Richard M. Daley to be honored with legacy award that bears his name. Who is the recipient of the inaugural Mayor Richard M. Daley Legacy Award for Global Leadership in Creating Sustainable Cities?  It’s none other than retiring Chicago Mayor Richard M. Daley himself.

Writing in the Chicago Tribune, architecture critic Blair Kamin said “Chicago’s lame-duck mayor, famous for his green thumb and his iron fist, will receive the award at the annual Greenbuild conference in Chicago this November, the U.S. Green Building Council (USGBC) announced.”

The Greenbuild Conference & Expo will be held in Chicago at McCormick Place West November 17 – 19.  Roger Platt, Senior Vice President of Global Policy and Law for the USGBC, said “USGBC is incredibly honored to be part of Mayor Daley’s legacy as a world leader in demonstrating how a nurturing and sustainable city can be the highest service to a community.  This award is in recognition of the Mayor’s visionary and planet-changing leadership that has created the amazing legacy of a green city.  We are looking forward to bringing our Greenbuild conference back to one of the world’s most sustainable cities.”

Chicago holds the honor of being one of the first cities in the United States to adopt LEED certification for its public buildings.  Additionally, the city boasts the largest number of LEED-certified buildings in the nation.  “During Daley’s 21-year reign as mayor, according to city officials, Chicago has planted more than 600,000 trees, constructed more than 85 miles of landscaped medians and built more than seven million SF of planted roofs – more than any other city in America,” Kamin said.

Green Construction Comprises One-Third of All U.S. Projects

Monday, October 4th, 2010

Green buildings now one-third of all construction. Although construction in the United States has been slow since the financial meltdown of 2008, there is one niche segment that is thriving – green construction.  According to McGraw-Hill Construction, green buildings now comprise one-third of all new construction, an increase of two percent over 2005, a surprise in an industry that is historically slow to change.

A case in point is the new Silver LEED-certified Ross School of Business building at the University of Michigan.  The environmentally friendly building incorporates technologies such as dual-flush toilets, which use 0.8 gallons of water instead of 1.6 gallons.  Firm in the knowledge that LEED certification is worth the money, the University of Michigan is now committed to going green on all new construction projects that cost $10 million or more.

Terry Alexander, Executive Director of the university’s Office for Campus Sustainability, notes that the added cost of LEED certification is actually a small percentage.  Because the university already saves energy and water in its new buildings, the extra cost on a $100 million Silver LEED project would be just two percent.  That includes the hard cost of eco-friendly features as well as soft costs for the paperwork required to achieve LEED certification.  Alexander says that Michigan is confident that the LEED plaque sends a message about the university’s environmental priorities and that it increases the school’s prestige with students and employees.

Green Metropolis Takes Aim at Environmentalists’ Conventional Wisdom

Monday, August 23rd, 2010

Author David Owen thinks that New York is the nation’s greenest city.  David Owen, a staff writer with The New Yorker, has expanded on his 2004 article entitled “Green Manhattan” that roughs up some of the environmental movement’s most closely held beliefs in a new book entitled Green MetropolisA review by Catherine Tumber, originally published in The Wilson Quarterly, notes that “Eco-friendly suburbanites and small-town residents are only kidding themselves as long as they live in sparsely settled, spaciously appointed, auto-dependent communities.  If they really want to reduce their carbon footprint in any significant way, they should live in densely settled, pedestrian-friendly, public-transit-oriented cities like New York.”

Owen suggests that cities like New York build on their biggest low-carbon asset – their large population densities – and place less emphasis on green buildings, urban agriculture and increasing the size of the city’s parks.  He even believes that Central Park is too big and wasted space that could be used to support even more housing.  Additionally, Owen takes aim at “the spectrum of green-tech fixes under development, from residential solar panels and LEED-certified buildings to ‘net-metering,’ de-concentrated ‘distributed’ electricity generation, ethanol production and electric cars.  ‘Nature-conservancy brain’ and ‘LEED brain,’ as he calls these environmentalist fixations, are too often driven by PR and do little more than distract from the more difficult task at hand:  how to get Americans to kick the car habit and live together more closely, in smaller spaces,” Tumber writes.

According to Owen, New Yorkers are environmentalists because they live in a city where a car is a luxury and residents tend to walk, take the bus or the subway.  “In urban planning in particular,” he said, “the best, most enduringly fruitful concepts have usually arisen accidentally, and have endured not because anyone was wise enough to identify and preserve them but because they serendipitously developed what was, in effect, a life of their own.  Owen argues that New York should be viewed as a model for other cities that want to reduce their carbon footprint.

Tumber notes that “Owen makes a point, almost in passing, that also deserves further conversation:  rather than reducing the carbon footprints of apartment buildings or growing food on precious urban real estate, cities should be focusing on ‘old-fashioned quality-of-life-concerns’ such as education, crime, noise and recreational amenities – the very troubles that drove people into suburbia in the first place.”

Chicago Boasts 2010’s Biggest Commercial Transaction

Tuesday, August 17th, 2010

In Chicago’s – and one of the nation’s — largest commercial transactions of 2010, the 60-story, 1.3 million SF 300 North LaSalle Street skyscraper was sold for a whopping $655 million.  That adds up to $500 PSF. The buyer was KBS Real Estate Investment Trust II (KBS REIT II). The LEED Gold certified building, which is 93 percent occupied by such tenants as Kirkland & Ellis, LLP; Boston Consulting Group; GTCR Golder Rauner, LLC; and Quarles & Brady, LLP, is a Class AAA tower completed in the spring of 2009 by Hines Interests.300 North LaSalle Street sells for $655 million – that’s $500 PSF.

“This high-quality property, with its strong tenant credit and long-term leases, fits perfectly within our investment parameters to provide long-term cash-flow stability,” said Bill Rogalla, KBS Realty Advisors senior vice president.  “It qualifies as one of the newest and highest-quality properties built in the U.S. in Recent years.  The building’s features, unmatched view corridors and LaSalle Street address resulted in a rapid lease-up even during the economic turndown.  We expect the building’s Class AAA-quality and environmental attributes to contribute to significant tenant retention over the long term.”

The interesting thing about the deal is it’s an indication of the large capital pipeline the REITs have amassed.  Also, it proves that assets with long-term leases and high-credit tenants are still trading at historically low cap rates.

AIA Edges Closer to USGBC Standards for Green Buildings

Thursday, August 12th, 2010

It costs more than $100,000 to fill out LEED certified.  Could the AIA offer a better way?  It’s surprising that the AIA still does not endorse LEED standards for green buildings.  There has been some progress in forming some kind of strategic alliance, but that is only in the area of advocacy, education and research.  There is still nothing concrete.  Nevertheless, the Architecture 2030 Bulletin and the AIA 2030 Commitment story are very interesting. The AIA website has many downloadable forms that comprise their own version of building performance measurement.  It’s likely that the AIA will step up to form their own rating system to compete with the United States Green Building Council (USGBC), which is a very lucrative non-profit organization that the government chose to use for their own needs to employ green strategies — and when the government chooses a program, everyone else follows.

I hope the AIA will offer an alternative form of measurement to the USGBC.  The USGBC’s process requires too many consultants and specialty firms to work independently on hundreds of credit applications.  Ideally, the architect and his/her engineering consultants should be able to perform all of the analysis as part of their basic services.  As of now, we get huge additional fee requests for the architect/engineers to help fill out LEED forms, and separate fee requests for energy models, LEED consulting, and commissioning services.  It costs more than $100,000 in miscellaneous fees just to fill out and upload credit point applications.  Many think that $100,000 could be used to improve the building’s performance.

Distribution, Manufacturing Facilities Are Going Green

Tuesday, June 22nd, 2010

Home Depot, NCR are greening their companies.  Home Depot, NCR are greening their companies. Fortune 500 companies are increasingly using energy-saving measures in their corporate real estate.  Some firms are retrofitting warehouses to conserve energy or are applying Japanese principles to building design and operation.

Home Depot, for example, has 2,245 retail stores comprising 235 million SF nationally, owns 89 percent of its real estate and is working to reduce its energy consumption.  In 2004, energy use for stores was approximately 25 kWh per square foot.  Today, energy consumption is just 21 kWh per square foot, a 16 percent reduction.

Since 2004, energy use has been cut by 2.6 billion kilowatt-hours (kWh), enough to power 203,000 homes for a full year.  Home Depot’s objective is to reach a 20 percent reduction in kWh per square foot in U.S. locations by 2015.  The company also plans to cut its domestic supply chain greenhouse gas emissions (GHG) by 20 percent by 2015.

Yet another example is NCR Corporation, which used Japanese “lean” practices at its new 350,000 SF plant in Norcross, GA, where it manufactures ATMs.  The technique eliminates waste and streamlines production processes.  Because NCR recycled cinder blocks and carpeting at the facility, it is seeking LEED certification on the retrofitted building.  Additionally, NCR produces cash registers that use two-sided receipt printers that cut paper usage by as much as 45 percent and use less power.

Converting the plant to make it energy efficient was not easy, according to Beth McClurg, NCR’s director of corporate real estate, who notes that “It is taking extra cost to do, which may not have immediate payback in terms of our financials, but because of the importance, we’re proceeding and hope to have LEED certification soon.”

Half of Commercial Buildings Could Go Green by 2015

Monday, January 18th, 2010

Going green in new and renovation projects is not as expensive as previously thought.  By 2015, green buildings could constitute approximately half of all commercial space, according to a study by Good Energies, Inc., a New York venture capital firm.  Although sustainable initiatives were perceived as a niche market just 10 years ago, developers now realize that going green in new and renovation projects is not as expensive as previously thought.

According to Greg Kats, senior director of climate change for New York-based Green Energies and the study’s author, he applied the U.S. Green Building Council’s Leadership in Energy Environmental Design standards – which encompass such categories as energy and water use, site location, landscaping and proximity to mass transit and shopping – to define what qualifies as a green building.  LEED certification was not required, though buildings had to adhere to the standards.

Similarly, a McGraw-Hill Construction study released last October found that the share of the green retrofit market could grow to 20 or 30 percent over the next five years.  That translates to market opportunities for major projects totaling $10.1 to $15.1 billion.  At present, green building practices are incorporated into five to nine percent of building retrofits.  The market opportunity for major projects – those costing more than $1 million – could total as much as $2.1 to $3.7 billion a year.

“We now have a large enough, detailed enough body of data to say that the presumption is ‘why wouldn’t you do a green building?'” Kats noted.  “It’s very cost-effective and it reduces risk in a number of areas including health, exposure to energy and water prices and obsolescence.”

Lenders Get Green

Thursday, October 2nd, 2008

Marketing green is a new step in the emergence of sustainability.  In a tight credit environment when rates have climbed and LTVs have dropped, green may offer a way to ease the underwriting criteria on a deal.

The green-building revolution is spreading, and the underwriting community has embraced sustainable design because it enhances marketability and income.  To illustrate, net rent in a particular office market may include a $15 psf in base rent and another $8 in common-area costs – the latter driven largely by energy and water-use costs.  It adds up that if you reduce that common-area cost and pass the savings along to the tenant, your building will be more attractive because it operating costs are lower.

Community banks in environmentally conscious markets or in areas where local building requirements foster sustainable projects are offering standard loans with terms favoring green development.  In San Francisco, the New Resource Bank offers qualifying green projects a generous loan-to-value ratio of as much as 80 percent, and a slightly better interest rate than it does to conventional project developers.  Green lenders look for incremental steps such as preferential review, quarter-point interest-rate discounts, longer amortization and relatively small changes in return for LEED or Energy-Star certification.

In Houston, the Green Bank recently moved into a 20,000 SF headquarters specifically designed to earn LEED’s gold certification.  Previously known as the Redstone Bank, it was acquired by a local banker who rebranded it as Green Bank and launched in January of 2007 with a focus on sustainability.  Just 1 ½ years later, Green Bank has $275 million in assets and is creating a group of environmentally conscious companies and individuals.  One vital goal is to educate team members to identify green-oriented customers, whether they are recyclers or LEED-certified construction space users.