Green building advocates have long argued that the “magic key” to unlocking the chains of skepticism is proving that green buildings are better at attracting tenants at higher lease rates and can be resold for at a higher value than traditionally built buildings.
Without some extremely knowledgeable and creative designers, most would agree that building green carries a first cost premium. Many are willing to accept that for the long-term savings in energy and other utilities. This has been proven in green buildings many times over. But a higher resale value? A higher value to tenants? It’s almost impossible to know. What are the benchmarks? Baselines of comparison?
However, an article in a recent issue of Barron’s by Charles Lockwood, an environmental and real estate consultant (according to his bio), offers a few strong pieces of evidence that add to the advocates’ argument.
The article spends a lot of time explaining to the uninitiated what green building actually is, but the really interesting stuff is near the end. Lockwood provides two “case studies” of Chicago LEED-certified buildings that had more than $100 million profits in resale and exhibited higher occupancy rates than the average for their locations.
It’s some of the strongest evidence yet. However, the question is: Were the profits because the buildings were green or because of their prime downtown Chicago location? There’s no way of knowing if the buildings could have made a similar profit in resale if they weren’t green. Hence, the elusiveness of the magic key. But Lockwood and other green building believers would certainly argue that these two buildings bring them one step closer to finding it.
The lead article in Building Operating Management’s January Green Building Report also dealt with this issue.