Development industry says, “Building green is here to stay”
Last week the leading real estate developers around the world gathered at the ULI’s Developing Green: Integrating Sustainability with Success conference to better understand the future of green building. Their
summation? Not only is green building here to stay (as this official conference summary is titled), but it’s fast becoming a standard, and that’s a good thing considering 40% of the carbon gas emissions released in the U.S. comes from commercial buildings.
Why the green transition? The two main reasons:
1. Mounting proof that green building does not cost significantly more to build, and in fact generates energy savings that quickly offset upfront costs. The costs to build housing using green building materials is no more than 3% higher than using standard materials.
2. Growing public demand for products and services that promote health and wellness. 91% of prospective buyers said they would pay extra for amenities related to health and fitness, and 41% said they would do so even if they could not recoup their costs.
To a lesser degree, the other reasons stated were:
3. Rising energy prices. It’s gone up, but not enough to make a developer go green.
4. Growing concern over global climate change. Ok, some developers are altruistic, but even then…
Finally, three guidelines if your development is going green:
1. What is ecological must also be economical.
2. Green must be gorgeous.
3. Green must be fun and functional.
3%? I am surprised Home Depot and Lowe’s are not aggressively jumping on this!
What home-efficiency (LEED and Energy Star) needs to take off is critical mass. We need committed developers and small towns. I wrote about the power small towns have to LEED change across the country earlier this week.
If the interests builds up to where the suppliers/manufacturers of the LEED/Energy Star certified products can be competitive with traditional inefficient products, investors will scramble to fund and grow these companies, ultimately helping the end consumer. The Wall Street Journal’s Energy Roundup agrees that this might be a great way to spur growth in the residential sector.
I comment regularly on the business/investor side of alternative energy on Energy Spin: Alternative Energy Blog for Investors-Served Daily.