Green up, America! Featured

8:00pm EDT March 26, 2007
Green buildings offer companies the opportunity to maximize both economic and environmental performance. Potential economic benefits include reduced operating costs and improved employee productivity. Environmental advantages include resource conservation and improved air and water quality.

The term “green building” can be used to describe various aspects of a building, says Norm Bertke, managing director of asset services for CB Richard Ellis.

“Aspects of green buildings can include items such as the site that is chosen, the construction materials selected and the design of the asset’s infrastructure,” he explains.

Smart Business spoke with Bertke about green buildings, the financial benefits that can be achieved with them and how to get started in locating a suitable property.

Why are green buildings gaining popularity in the corporate world?

One reason green buildings are gaining popularity is simply the cost savings that can be associated with operating an efficient building. Efficient building systems result in lower consumption of utilities and, therefore, cost savings.

There is also data that suggests that because green buildings are often constructed to mitigate dust and other allergens in the indoor air and efficiently utilize natural light, the occupants are often healthier and happier than the occupants of non-green buildings. This leads to cost efficiencies for the occupants because of improved recruiting, reduced sick time and less turnover.

Finally, many corporations simply think that being green is the right thing to do and as long as it is at least cost-neutral, these corporations prefer to be green.

What are some of the financial benefits that can be realized from using a green building?

Green buildings often leverage the use of efficient systems to save on utilities. Variable-frequency drives offer an improved ability of the operator to control the heating and air-conditioning system. Flushless urinals mitigate the use of water. New light bulb technology allows the lights to burn more efficiently and last longer. Occupant sensors allow lights to turn off when the rooms are not in use. All of these items reduce utility consumption and lower costs.

However, the cost implications of lower turnover and reduced sick days can be much more significant. Many buildings operate at approximately $2 per square foot for utilities. It is reasonable to assume that it costs an employer $200 per square foot for personnel-related costs and that some sales professionals generate $20,000 per square foot occupied in revenue. If an employer can execute tactics via a green building to keep their employees on the job, the payback could be huge.

How do the costs of a green building compare to that of a traditional building?

This is a function of how green do you want to be and what kind of green? A certified building (one certified by the U.S. Green Building Council) can have almost no incremental cost if a green strategy is implemented from the conceptual phase. However, if the goal of being as green as possible is executed without factoring costs, the incremental costs can be significant. In other words, the technology exists, at a price, to build extremely efficient, environmentally friendly buildings, but there is a point of diminishing returns as it relates to a monetary payback.

How much can be saved on energy bills?

If an existing building is already efficient, sometimes there is little to no additional savings to realize. However, many buildings can achieve energy savings in the 10 percent to 30 percent range. In many cases, older buildings can be ‘recommissioned’ or set back to operate within their original design parameters to capture savings and the capital investment associated with new infrastructure investments is not necessary.

How has energy-saving technology improved over the past decade or so?

There have been technological improvements in the way HVAC systems operate. Variable frequency drives allow the operator to turn up or down the rate at which the systems run. Economizers allow building equipment to adjust their use of the environment by more efficiently using outside air to control interior temperatures. Lighting technology has also improved dramatically with the advent of low-mercury bulbs, electronic lighting ballasts and occupancy sensors that turn lights on and off automatically. In the realm of plumbing, low-flow, auto-flush valves and aerators allow building operators to decrease their use of water.

NORM BERTKE is managing director of asset services for CB Richard Ellis. Reach him at norman.bertke@cbre.com or (614) 430-5069.