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The study also found that Energy Star buildings generate an average of $2.40 more per square foot and a 3.6-percent greater occupancy compared to non-Energy Star buildings. Comparing sale prices, the study found that LEED buildings sell for $171 more per square foot than non-LEED peers. Energy Star-label buildings sold for an average of $61 per square foot more than their peers.
The higher occupancy rates could result from many companies realizing that the costliest element of a building's total operation is the people inside -- and that the environment significantly affects people.
For instance, a study by market-research group the Light Right Consortium found that 85.8 percent of a company's total operating costs per building square foot comprises salaries and benefits. Consider also that many studies have consistently concluded that LEED-certified buildings provide increased daylight, views of nature, improved air quality, and increased thermal and acoustical comfort. This often yields significant individual productivity and health benefits, including improved overall health, performance and job satisfaction. Employers, in turn, enjoy higher total workforce productivity, lower staff-turnover rates, lower absenteeism and lower health-care premiums.
With all other underwriting elements being equal, a green building with a proven track record of energy-cost reduction and sustainable management systems likely will be more attractive to a mortgage lender than a building that has not seen such efforts.
In addition, lenders that adopt sustainability evaluation in their underwriting practices will show that they value and reward borrowers' efforts to be better environmental citizens. As a result, this will demonstrate the lender's own corporate environmental commitment.
With these changes, borrowers' operating costs will go down, their access to reliable future energy at stable prices will increase, and the amount of greenhouse gases released into the atmosphere as a result of their energy consumption will be significantly lower.
a Leadership in Energy and Environmental Design (LEED)-accredited professional and registered environmental assessor in California, is vice president of Nova Consulting Group, an environmental and engineering consulting firm specializing in real estate due diligence. Throughout his career, Murphy has participated in more than 8,000 environmental site assessments, subsurface investigations, property-condition assessments and seismic evaluations. Reach him at his San Francisco office at (415) 377-2431 or firstname.lastname@example.org.
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