Green Construction is becoming an unstoppable forward momentum, not just for its ecological benefits but also for its economic advantages.
The U.S Green Building Council (USGBC), report that school students attending classes in "green" structures score higher on the national levels. This is attributed to the controllability, comfort, and non-toxicity levels common place to a green project.
Along with those reports are the number of studies conducted (even as part of the LEED certification process) that show employee absenteeism due to illness is lower than the national average, productivity is higher (even as high as 30% in some case studies).
We can assume that what's good for a tenant is also good for the property owner.
However, there continues to be a stigma associated with the First Costs of LEED and Green projects. Hopefully, after reviewing the information we've included here those misconceptions will be replaced with an interest in the possibilities of sustainable construction methods.
It is true that the First Costs of a LEED, or Green, structure can range from $3 to $5 per square foot over conventional construction methods. However, the completed project generates between $12.50 to $16.25 per square foot in asset value and income over that of the conventional construction comparisons. The majority of those higher First Costs results from Energy Modeling, Architectural, and Engineering considerations, thus most of the cost is associated with Professional fees.
However, the industry asserts that rather than attribute these costs to Construction they should be deemed Marketing expenses. Lenders are offering lower interest rates for Green construction loans, although some do hold back a percentage of the funds until LEED or Green certification is verified.
Becoming LEED, Green or Energy Star certified does bring positive publicity. Tenants are more desirous of Green spaces than the conventional and are more likely to maintain long term leases and renewals if the structure and space are maintained to the standards of the certification. "Green Leases" containing Ecologically Sustainable Development ("ESD Principals") ensure that both the property owner and the tenant adhere to the maintenance of a certified structure.
Construction costs are determined by the small details. Returns on investment and resulting equity values have a large bearing on the number of small details included in a project. A property owner will simplify the details to save money or will splurge on the details to "Market" his property benefits over another site.
As reported by CoStar Group in "Commercial Real Estate & the Environment", the sale price for a conventional office structure was an average $257 a square foot while Green/LEED structures saw an average $438 a square foot.
Occupancy rates were 87.9% for conventional compared to 92% Green (with a noted 60% pre-occupancy rate for new structures) and rental rates were $31.05 per square foot for conventionally constructed spaces compared to $42.38 per square foot for Green.
Energy costs were also noted, in a multi-use structure, to be $2.00 per square foot in conventional compared to $1.29 per square foot for a green system. The U.S. Green Building Council contains links to published reports as well as data compiled by case study of such comparisons.
The advantages to building a LEED or Green structure are vast. The State of Washington Department of Commerce site contains links to City, PUD, PSE, County, State, and Federal tax rebates, incentives, depreciation and tax code changes targeted exclusively to LEED/Green projects.
CMS Construction Company, Inc., together with industry professionals we've worked with for over thirty years, and service providers likewise proficient in the Green process make the perfect team for your project. We strive to provide economical and exceptionally sustainable structures.
Contact us for more information. Our on-staff LEED AP can help with the planning process and will work through your project's completion. We look forward to hearing from you.
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