As published in Scotsman Guide's Commercial Edition, July 2010.
In recent years, the commercial real estate community has paid increased attention to buildings' energy use. In fact, some institutional investors and lenders now evaluate a building's energy usage as part of their standard due diligence. In addition, there is a nationwide trend toward greater transparency of energy usage, especially in light of increasing energy costs.
Certain benefits of energy-efficient buildings are irrefutable. These buildings typically have lower operating costs, greater occupancy and rental rates, and higher sales prices than non-green buildings. Purchasers, tenants and financiers of commercial properties likely will pay more attention to these important realities in the coming months and years.
Commercial mortgage brokers can help their clients understand these benefits, how to address a building's energy use as part of their due diligence and whether legislation exists in their city or state about disclosing a building's energy use.
D.C., California lead way
Several states and municipalities have enacted laws mandating the disclosure of a building's energy use to interested parties or the general public. Washington, D.C., and California have led the nation in energy-efficiency and environmental protection.
With its Green Building Act of 2006, Washington, D.C., was the first major city to enact such legislation in an effort to reduce new and existing buildings' environmental impact. The act was one of the early pieces of legislation that required buildings to achieve the criteria of the U.S. Green Building Council's Leadership in Energy and Environmental Design rating system. The legislation required eventual disclosure of a property's energy use. Further, beginning in 2012, buildings' energy data will be published in a public, online database.
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