Sustainability: Why Green Building is Imporant, Even During Rough Economic Times

We’ve been hearing so much lately about the economy and its potential damaging affect on the commercial real estate market. A variety of recently released reports point to green building as a key solution to many of the challenges our country faces today, from a faltering economy, unemployment, to rising energy prices and America’s dependence on foreign oil.

How so? For starters, green building can contribute to a vibrant industry that could drive economic recovery. McGraw-Hill Construction’s Green Outlook 2009 report “Trends Driving Change” shows that by 2013, the overall green building market (both residential and non-residential) is likely to more than double to $96-140 billion. And studies have shown that the LEED green building certification program has the potential to contribute billions to the economy. A Greener World media study reported that LEED certified projects are directly tied to more than $10 billion of green materials, which could easily reach more than $100 billion by 2020. The U.S. Green Building Council’s nationally recognized LEED program provides third-party review and certification of buildings’ design, construction and performance in five key areas of environmental and health concern, including energy efficiency, water efficiency, materials and resources use, sustainable site development and indoor air quality.

And economic hardship isn’t keeping commercial real estate executives from building green. A recent Turner Construction Company’s report “Green Building Barometer” found that 75% of those professionals – including developers, rental building owners, brokers, architects and engineers – would not let the credit crunch discourage them from building green. In fact, 83% said they would be “extremely” or “very” likely to seek LEED certification for buildings they are planning to build within the next three years.
And while jobs continue to be cut and unemployment continues to rise, reaching 2.6 million in 2008, green building is able to generate new green jobs for Americans. The Center for American Progress and the Political Economy Research Institute at the University of Massachusetts Amherst found in a September 2008 study that a national green economic recovery program investing $100 billion over 10 years in six infrastructure areas would create 2 million new jobs!

Green buildings have the potential to help employers as well, as green buildings help companies cut costs, build sound financial situations and manage operating expenses. Rising energy costs are causing building owners and managers to tighten their belts, and the buildings they use day in and day out cost them millions in unnecessary operational costs. Respondents to Turner’s “Green Building Barometer” said their green buildings have resulted in lower energy costs, with 68% reporting lower overall operating costs. By investing in green technology in both new and existing buildings, building owners and managers are able to reap long-term operational and maintenance savings, all the while bettering the environment.

The Center for American Progress’ study shows how green investments on a wide scale can ignite the economy of the nation as a whole. A $100 billion green infrastructure investment over 10 years, with a focus on green building retrofits and investment in alternative energy sources, could be paid for with proceeds from carbon permit auctions under a greenhouse gas cap-and-trade program. That’s roughly the same amount of investment as the tax rebate checks sent as part of the April 2008 economic stimulus plan but would create 300,000 more jobs.
In short, green building offers a source of solutions and an opportunity for commercial real estate firms to tackle the challenges facing today’s society.

If you have any comments or ideas, you can reach Marc at mheisterkamp@usgbc.org.