Absolutely. Positively. Unequivocally. We believe so. But what exactly is the value? Good question.
Green is one of the most overused, abused and misused terms of the past 10 years. For the purpose of providing some context around green for this discussion, we will establish that a green building is one that has been certified under the U.S. Green Building Council’s (USGBC®) LEED® for Existing Buildings (LEED EB) rating system. While there are a number of green labels available for individual buildings, LEED EB offers a well-defined set of criteria based on industry best practices that is measurable and verifiable, includes the rigor of a third-party comprehensive review process and is accepted as the leading sustainable building standard. On the other hand, LEED for New Construction (LEED NC) or LEED for Core & Shell (LEED CS) certified buildings are not considered green buildings for the purpose of this green value discussion. The lack of embedded, ongoing, required sustainable operations practices in LEED NC and LEED CS buildings remove them from the conversation of green buildings.
Numerous surveys and studies have attempted to prove the value of green buildings, including some supported by CBRE. While they all lead to similar conclusions that the greening of a building adds value, the measurement of the value, the methodologies used to identify the value and the resulting assertions about value vary greatly. There are many challenges associated with establishing green value or creating a replicable measure of value that can be applied on a broad scale to achieve reasonable justification for the conclusions of a survey or study.
How do you quantify the environmental and social aspects of a green building in economic terms? How do you accurately measure the human experience in the built environment relative to productivity, comfort and well-being in a way that can be applied building by building in the world of appraisers or lenders? How do you put into terms of calculation the vague notion of sustainability? How do you account for the impact of green building attributes relative to people, the single-most important cost for any corporation?
Additionally, the set of investment grade office buildings that has been certified through the LEED EB rating system is still small in proportion to the non-LEED EB set. The majority of the first group of LEED EB buildings represent the best buildings in the best markets, further skewing research data aimed at proving the notion of a “green premium” of higher rents, higher occupancy and greater sales price.
The perspective of people both questioning value and defining value also clouds the view. What is green value to an investor, shareholder, corporation, occupier, appraiser, lender, landlord or community? Although components may have similarities, I would argue that the ultimate green value is different to each group. What is valuable to one group is meaningless to another.
Many surveys have been completed that reached the same non-surprising trends and conclusions about the perception of value concerning green buildings and sustainability. Multiple studies of varying hypothesis and methodologies have, through data collection and analyses, attempted to quantify and prove value, each ending with similar concurrences.
Does green add value to a building? Definitely. Unquestionably. Categorically. We think so. But what is the value? Stay tuned!