Looking to engage and support the commercial real estate sector in your jurisdiction as they explore the value of energy efficiency in real estate? The Institute for Market Transformation (IMT) and Rocky Mountain Institute (RMI) are arming the commercial real estate industry with a new set of tools that enable tenants to more effectively seek out and secure high-performance spaces that are in line with the tenant’s organizational goals, objectives, and budgets. Visit RMI’s blog to learn more about these resources to support green leases and other energy efficient best practices; a short excerpt is shared below.
Looking for more on green leases, either to support commercial real estate or for direct use in your municipal portfolio? Several local governments recently expressed interest, leading to a call for information: learn more and see what resources were uncovered here.
From Rocky Mountain Institute:
A typical search for office space can require combing through hundreds of listings and running the numbers on rent, utility costs, insurance, and building fees in an attempt to make an apples-to-apples comparison of different market options. And then there are the less quantifiable aspects of the search: How do you factor in your personal experience of entering a building? How do you put a value on a gut feeling of whether the space feels healthy and productive, or fits your personality and lifestyle? Often—at least more than we tend to admit it—those less tangible and subjective factors determine whether or not we sign on the dotted line.
For a large commercial real estate tenant, this challenge is even more complex. In addition to budgets and other financial criteria to prioritize, many companies and organizations must factor in sustainability commitments, brands based on corporate social responsibility values, and employees who will spend more than eight hours each day in the space they select—employees whom they want to retain and keep healthy, happy, and productive. Not to mention factoring in the boards and shareholders to which many companies must answer.
“The majority of tenants have classified the fundamental challenge as this: If I’m in a high-performance building, I can see how much energy I save, but I can’t see how much productivity we’ve gained, how much we’ve reduced rates of absenteeism, and what health benefits we’ve accrued,” said Alexandra Harry, senior associate with the Institute for Market Transformation (IMT), a leading organization that works to improve the energy efficiency of buildings. “Without a number to assign to this reduction in overhead costs, it is nearly impossible to accept higher rents in a ‘green’ building.”
Thus, although a space may feel right because of the enhanced work environment it would deliver—resulting in greater employee health, productivity, retention, and attraction—the current challenge tenants face of making even basic estimates of the impact of these “soft benefits” means these benefits are most often not included in apples-to-apples assessments that tenants conduct. Read more and access tools on RMI’s blog.