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MOTIVATIONS AND TRENDS

MOTIVATIONS AND TRENDS. 1. Slide header copy. In This Chapter. Sustainability in commercial property Quantitative motivators Qualitative motivators Client types. 1-1. 1-1. Slide header copy. Market Size.

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MOTIVATIONS AND TRENDS

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  1. MOTIVATIONS AND TRENDS 1

  2. Slide header copy In This Chapter • Sustainability in commercial property • Quantitative motivators • Qualitative motivators • Client types 1-1 1-1

  3. Slide header copy Market Size • Demand for sustainable properties, certified buildings, green features, and sustainable commercial interiors has grown in last several years 1-2

  4. Slide header copy Projected Growth Source: Reprinted with permission of McGraw-Hill Construction, Commercial & Institutional Green Building: Green Trends Driving Market Change, New York, NY: McGraw-Hill Construction; 2008. 1-1 1-3

  5. Slide header copy Quantitative Motivators • Use caution when presenting results from studies • Study of quantitative return from sustainable property is work in progress • Methodological challenges may produce “outlier” results 1-4

  6. Slide header copy Sustainable Property, Value, and Investment Risk • According to one of largest national studies available, sustainable properties: • Gain value at rate similar to or slightly better than comp. conventional properties • Hold similar or slightly reduced investment risks compared to like properties Source: Pivo, G. and J.D. Fisher. “Investment Returns from Responsible Property Investments: Energy Efficient Transit-oriented and Urban Regeneration Office Properties in the US from 1998-2007,”www.responsibleproperty.net/assets/files/pivo_fisher_10_11_08.pdf 1-1 1-5

  7. Slide header copy Decreased Operating Costs • According to EPA and DOE, significant payback is available from low- to medium-cost upgrades: • Recalibrating thermostats • Relamping with higher efficiency fluorescent bulbs • Changing incandescent bulbs to compact fluorescent lamps (CFLs) • Using ENERGY STAR–labeled equipment 1-6

  8. Slide header copy Projected Cost Savings for Low-cost Changes Source: Reprinted with permission of McGraw-Hill Construction, Commercial & Institutional Green Building: Green Trends Driving Market Change, New York, NY: McGraw-Hill Construction; 2008. 1-1 1-7

  9. Slide header copy The Win-Win-Win • Reduced energy consumption a win-win-win: • Increase profit margin for the owner • Bring down costs for tenants • Reduce carbon emissions and conserve natural resources 1-8

  10. Slide header copy Payback from Upgrading UAD Systems Note that churn cost is cost of replacing employees and includes advertising cost, employee training, and lost productivity 1-1 1-9

  11. Slide header copy Improving Efficiency and Saving Costs: Adobe Towers 1-1 1-10

  12. Slide header copy Discussing Payback with Clients • Examples of payback may not be replicated in client’s situation. • Large-scale changes should be energy-modeled for impact on whole building system. • Changes in efficiency of one system may affect other systems. • The higher the going-in energy cost, the shorter the payback period. 1-11

  13. Slide header copy Increased Tenant Retention • Tenant retention can be quantified for ROI as avoided costs in tenant replacement 1-12

  14. Slide header copy Qualitative Motivators • Marketing value for corporate clients and tenants • Employee productivity and health • Lower risk of decreasing value/obsolescence • Staying ahead of regulation 1-1 1-13

  15. Slide header copy Marketing Value • Market differentiation • Benefit to the financial performance of the company • Early market entry = long-term consumer loyalty 1-14

  16. Slide header copy Value of Supporting Productivity and Health • Reduced absenteeism • Longer term employee loyalty gains • Increased productivity • Ability to attract and maintain high quality workers 1-1 1-15

  17. Slide header copy Building Green and Reduced Risk • Reduced risk from employee health liability • Reduced climate change liability • Protection from increases in resource cost • Protection from sprawl • Reduced risk from future government regulation 1-16

  18. Slide header copy Examples of Regulation Case Studies • Seattle • Boston Sources: Photo of Seattle Public Library reprinted with permission of King County Seattle Public Library, “About the Library,” www.spl.org/default.asp?pageID=branch_central_about&branchID=1. Photo of One Beacon Place Reprinted with permission of CB Richard Ellis. One Beacon Street: One Beacon Is Going Green!, www.1beaconst.com/goinggreen.html. 1-1 1-17

  19. Slide header copy Exercise: Reduced Risk and Sustainability • Consider the example of Building Green and Building Blue. • In the spaces provided, write your answers. 1-18

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