Real estate investors have sometimes been wary of going green for fear that it would add up to higher building and construction costs. It turns out that they were right. Construction cost for green buildings are higher than the cost of conventional buildings. A study made by CoStar Group, however, shows that while the construction of green building has its price, it also pays.
Green buildings are so called because they are energy effecient, gentle on the environment, and sustainable. These buildings follow a design that reduces the negative impact of the construction on humans and the environment as well. Sustainable buildings allow the efficient use of resources including water, materials and energy.
The 2008 study, which looked into the location, size, year they were built, tenancy and class of over 1,300 buildings showed that green buildings with Energy Star label or LEED certification have lower operating costs, enjoy higher rents and improved occupancy rates as compared to non-green buildings. LEED-certified buildings however performed slightly better than buildings with the Energy Star Label.
LEED-certified buildings do not only “command rent premiums of $11.33 per square foot over their non-LEED peers and have 4.1 percent higher occupancy rate” Compare this to the 3.6% higher occupancy rate and $2.40 per square foot premium for Energy Star buildings.
Green buildings are not only more profitable but they are also a healthier alternative resulting in increased employee productivity and better health for the occupants. These buildings also yield less waste and pollution. Homeowners can replicate the green building concept in their homes by using energy efficient practices and locally-sourced materials.
By efficiently using energy and water you reduce the operating costs of your building. And with less pollution you get a much-improve indoor air quality resulting to better health for the building occupants.
Green buildings can be any color. They are not distinguished from non-green buildings by appearance but by the resulting harmony in aesthetics and ecology. You can suspect that a building is green when you see that the structure is harmonized with its environment.
The high rental, sales price and occupancy rate of green buildings were attributed to supply and demand. Apparently, the growth in the number of buildings with Energy Star and LEED certification is not enough to meet the growing demand for green buildings.
Putting your money on green buildings is worth the price and effort because you are assured of an increase in the value of your property. Green buildings use less energy and logically they result to lesser operational costs.
While the real estate market depressed there is a strong evidence that developers who invested in green buildings that follow the guidelines set up by the US Green Building Council are not scratching their heads but are instead enjoying fuller buildings.
Owners of existing structures or those who are still planning their construction can still cash in on the benefits being reaped by green building owners. The efforts to greening your structures need not come in one single step but it can start with several small but steady steps like perhaps reducing the exposure of humans to noxious materials when building or renovating your sites.
More on the study can be seen here.
