Green offices: More developers see the financial benefits of eco-friendly building
As downtown Salt Lake City undergoes a major commercial building boom, local business leaders are being asked to consider the potential long-term impacts of green development on the community and their bottom lines.
More than 800 people attended the 2008 Utah Commercial Real Estate Symposium on Thursday at the Salt Palace. Similar events were also held Thursday in Provo and Ogden.
"Green fuels the new economy of real estate" was the theme of this year's event, sponsored by the Utah chapter of the National Association of Industrial and Office Partners.
Symposium moderator Michael Jeppeson said Utah companies are starting to recognize the substantial financial benefits of sustainable design.
"We need to educate CEO's, COO's, brokers and investors about why they should be thinking about green," said Jeppeson, who is president of Salt Lake City-based Green Earth Development. "It's not just about being good for the environment."
The biggest benefits for businesses to consider environmental standards in their developments are economic, because they can pocket the savings from lower operating costs from energy efficiency and reduced maintenance.
"We can save 25 percent of operating costs, and that goes immediately to the bottom line of a developer," he said. "The value of the real estate increases tremendously."
Keynote speaker and architect James Brew said commercial developers should follow the example set by the federal government regarding energy efficiency and green building.
"The government of the United States has long been on-board with the LEED rating system," said Brew, who is a principal with the Rocky Mountain Institute, an entrepreneurial think tank focusing on sustainability. "About 48 percent of the LEED projects are government, state or locally-owned."
The Leadership in Energy and Environmental Design (LEED) rating system was developed by the U.S. Green Building Council to promote environmentally sustainable building design and development. The standards consider sustainable site development, water savings, energy efficiency, materials selection and indoor environmental quality. Ratings range from basic, silver, gold, up to platinum.
Brew said the commercial real-estate market is now beginning to see the value of green and sustainability.
A number of prominent buildings in Utah have been built to LEED certifications standards, including the Utah Olympic Speedskating Oval in Kearns, the corporate offices of Big-D Construction in Salt Lake City and the Escalante Science Center in Escalante.
Don Billings, director of development and construction at Hamilton Partners, said his company is building its 222 S. Main office tower in Salt Lake to LEED standards. The 22-story building, scheduled for completion in 2009, will feature more than 350,000 square feet of class A office space.
"We are doing everything we can to get the project to a silver LEED certification," he said.
Billings said his company also has agreed to use sustainable energy for the office tower. "We plan on purchasing what's referred to as green power for the whole building for the first two years of the project," he said.
The company expects to recoup that initial expenditure through energy savings within the first few years of the building's operation, he said.
Stephen Smith with GSBS Architects said that although the Wasatch Front has been slow to change from its old development habits, developers are starting to recognize the positive attributes of green building. Developers who are just interested in quick resale of a property will not realize the cost benefit of higher building standards, but those who are thinking long-term can definitely see increased profits.
"If I'm going to realize a savings of hundreds of thousands of dollars per year on operating costs, we're talking about a lot of money over the life of the building," he said.
Smith said green building will have a significant impact on the amount of carbon emissions that commercial buildings release into the atmosphere."Commercial buildings generate more global-warming gases than almost anything else, about 50 to 60 percent of all greenhouses emissions," he said. "They create so much of the problem, so now they can become so much of the solution."