There was an interesting press release from the Progressive Investor Reports that green technologies in real estate development are becoming more popular. Now, I am not the biggest fan of the popular progressive cause of the day by any means, but this press release did make me laugh.
The question I asked when I read this is “Are businesses becoming green in their thinking because of ideology or because it is making good business sense?” Fortunately for me, as I dug into the PR material the answer became abundantly clear.
First off, energy prices are very high.
Developers and building owners are feeling the crunch of high energy and water costs, which, according to the Building Owners and Managers Association (BOMA), constitute 28% of operating costs for downtown office properties, and 30.4% for suburban properties. They see the quick payback and cost savings energy efficiency and other green building upgrades offer.
Hmmm… So a business adopting green practices can save a bunch of money and drop it to the bottom line. Well then, I am all for dropping dollars to the bottom line.
Building green no longer costs more. Turner Construction’s 2005 Green Building Market Barometer shows it costs a mere 0.8% more for basic LEED certification, easily recouped through lower operating costs.
And there is not a penalty for going green. In the past it was very expensive for companies to invest in these initiatives. If they did they were lauded by the environmentalist movement and burdened their shareholders. Now companies can make money for shareholders and get environmental accolades, must be a no brainer in the corporate suite.
Increasingly, clients and tenants show a preference for green buildings, which have been proven to increase productivity, retain employees and lower absenteeism. The combination of reduced operating costs and more satisfied occupants translates into 3.5% higher occupancy rates, 3% higher rents, and a 7.5% increase in building value, says the McGraw-Hill 2006 SmartMarket Report. via CSRwire.com
And the coupe de resistance, productivity increases and landlords increase their rents. So my question to you is, are we looking at the dawning of a new era in social consciousness or is the technology and tools of energy efficiency combined with higher energy costs making it a wise investment for businesses to go green?
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Well, Al Gore did manage to put it in front of all our faces with his movie, global warming seems to be a very serious threat.
I guess people are getting scared, and are hoping to reduce their carbon footprints. Same for business owners.
Whether it is for an office building, or a house, there are many ways to reduce our bills while being more eco-friendly.
Green is the way to go