Stephen’s at Greenbuild, which I’m sure will be fun for him, and for anyone who attends the panel on which he’s sitting on Thursday. And I… well, I’m well, thanks, but I’m tasked with the far less-exciting duty of breaking news that has been broken and re-broken near-continuously over the past five years. Two new reports, one from McGraw-Hill Construction and the other a survey by real estate mega-firm CB Richard Ellis, confirm things that most of us with some interest in green building already knew fairly well. McGraw-Hill’s Green Outlook Report — available on PDF for the low, low price of $249, and summarized in this press release — offers further proof that the market for green construction is growing at a rapid rate. The report from CB Richard Ellis, for its part, does much to prove why that is — namely, because green buildings deliver four percent greater return on investment and five percent more value than their conventional counterparts. This is good news, of course, any way you look at it. So why am I being such a grump about it? Well, because sometimes I’m like that, but also because other reports have delivered similar news for years now.
That doesn’t mean we shouldn’t applaud this good news when we get it, of course, or that these reports and surveys and white papers aren’t welcome when they arrive — we should, they are. But as green building — as the entire green idea — struggles to defend its brand and pierce the terrified apathy of a nation not currently at its discursive high point and increasingly prone to trollish, short-sighted behavior, it can be somewhat frustrating to have to go over all this again. That green buildings increasingly cost virtually the same amount to build as brown ones, and offer an increasingly rapid return on investment, is the sort of thing that the real estate world should accept as a given at this point. The numbers in the CB Richard Ellis report do not look particularly eye-popping on their own — beyond the aforementioned four percent and five percent figures, the study found that green buildings do five percent better in terms of tenant occupancy (and bring in one percent more rental income) than do brown buildings — but when the dollar amounts are as dauntingly vast as they invariably are in New York City real estate, four and five percent improvements come with plenty of zeroes on the end. It’s big news, but it’s also not exactly news.
The McGraw-Hill report offers somewhat more impressive figures. “Today, a third of all new nonresidential construction is green — a $54 billion market opportunity,” the press release reads. “In five years, nonresidential green building activity is expected to triple, representing $120 billion to $145 billion in new construction (40%-48% of the nonresidential market) and $14 billion to $18 billion in major retrofit and renovation projects. To break it down further, health care construction this year is expected to grow its green share to as much as 40% (valued at $8 billion-$9 billion in 2010) — phenomenal growth in just two years. Education (valued at $13 billion–$16 billion in 2010) and office green construction (valued at $7 billion–$8 billion in 2010) also remain strong sectors, showing high increases in market share, due in part to the fact that bigger projects are the most likely to go green.” The report also notes that green buildings typically enjoy operating costs 13.6 percent lower than their brown counterparts, with green retrofits are not far behind with an 8.5 percent edge. Return on investment improvements are pegged at 9.9 percent for new construction green buildings and a whopping 19.2 percent for green retrofits. Numbers of this magnitude have come down the pike before, and have seemingly vanished without a sound in the bigger and infinitely dumber national conversation on green building. But there is a reason for hope, here, or at least a reason for me to drop the attitude. (It’s mostly that Stephen gets to be on a panel, and I’m going to have to write about Tiger Woods tomorrow morning)
That last bit of good news comes from the CB Richard Ellis report, which was a survey of the company’s national office holdings. It’s a more subjective figure, but one that may in a sense outweigh the more objective figures like those above, and the numerous others like them that have come and gone before. The CB Richard Ellis survey found that 79 percent of building owners surveyed believe that green buildings do better at attracting and keeping tenants than their counterparts. And that’s the sort of news that those of us who care about green building want to hear most. Green buildings have been kicking brown buildings up and down the block for half a decade now, and the gap in building performance continues to widen. But if developers, owners and landlords are starting, at long last, to notice… well, then we might be onto something.