Why Are Green Buildings Important? Here’s What Commercial Real Estate Needs To Know
Projected to hit $458.61 billion by 2030, the green building market is growing. With the use of smart technologies and sustainable products, building green has never been easier, which is great news for the environment and the health of humankind.
Green Buildings 101: A Quick Overview
The goal of green building is to protect the environment and improve the quality of life. You can accomplish this by building green from the ground up or retrofitting existing structures with resource-efficient upgrades. For instance, a building could be built using sustainable materials or upgraded with a new solar power system.
So, why are green buildings important? Well, they help reduce pollution, conserve water, slow climate change, and improve the health of their occupants. Plus, they can help developers secure specialized financing, build a solid reputation, and even save money on taxes.
Green Building Certifications
When building green, it's worth looking into green building certifications to help improve your building’s reputation and save some serious cash. Here are a few top certification options:
LEED: You’ll need to start early with a LEED-certified rater in the design phase, but this certification can help you qualify for tax benefits and up your resale value.
WELL: This international program focuses on certifying buildings as healthy.
Green Globes: You can certify both new construction and existing buildings.
Fitwel: This agency offers health certifications for different types of buildings, such as senior housing or retail spaces.
Energy Star: This annual certification can help you stay compliant with local energy mandates and is required for renting to federal tenants.
The Financial Benefits of Going Green in Construction
Green building techniques not only help the environment, but they can also help your wallet. The three main financial benefits to going green are:
Reduced operational costs
Improved property value
Government-backed incentives
When building green, initial costs can be hefty. However, you can quickly recoup money through reduced operational expenses such as decreased water usage, electricity bills, and maintenance issues. In fact, the average green building saves 10.5% on operational costs in the first year.
When it comes to property value, certification is key. An MIT study of Fitwel- and WELL-certified properties showed increased rent earnings of up to 7.7%. And a study of LEED-certified buildings found that sale prices were 21.4% higher compared to non-LEED properties.
And don’t forget about all the other incentives and savings, such as cheaper financing, reduced insurance costs, and tax savings such as the Energy Efficient Commercial Building Deduction.
Why Sustainable Buildings Are Better for the Planet — and Your Portfolio
Decreasing resource consumption, eliminating waste, and reducing carbon emissions are just a few of the reasons why green building is important. From sustainable materials and best practices to smart building enhancements, there are many ways in which a building can go green.
Using renewable energy sources is a great way to reduce your carbon emissions directly. And you can reduce your overall energy consumption through the use of LED lighting, smart thermostats, and automated systems for controlling HVAC, security, and lighting. You can even use AI to identify and improve your energy consumption patterns.
Not only does going green help the environment, but it's an essential step to take in tackling your broader environmental, social, and governance (ESG) goals.
Supporting Health and Wellness Indoors
The importance of green building goes beyond the environmental impacts. Health and indoor air quality (IAQ) are crucial too. From choosing low-emission materials to improving your facility’s ventilation, there are many strategies to choose from on the IAQ roadmap for real estate.
The goal in improving IAQ is to make your building healthy. Healthy buildings can increase productivity, reduce absenteeism, and improve building tenancy. For example, in an office environment, proper ventilation and filtration can reduce humidity and the spread of germs, and IAQ sensors can alert you to critical hazards like high ozone levels.
With the average American spending 90% of their time indoors, IAQ is changing the real estate for the better.
Government Incentives and Regulatory Compliance
Fannie Mae and Freddie Mac both offer green financing programs backed by the federal government. These and other green loans offer borrowers more funds with lower interest rates. Even a fraction of a percent of difference in APR can result in significant savings over the life of a loan.
To encourage green projects, many cities offer developers incentives and tax breaks to build green. And the federal government offers tax incentives such as the Energy-Efficient Commercial Building Tax Deduction and the 45L Tax Credit to building owners and contractors.
However, to qualify for these incentives and financing programs, your building must comply with set requirements, which may include certification.
What Qualifies a Building as Green?
So, what are green buildings and why are they important? According to the EPA, a green building is a structure "that [is] resource-efficient and environmentally responsible throughout the building's life cycle." This can include things like
Using energy, water, and other resources efficiently
Protecting occupant health
Reducing waste, pollution, and negative environmental effects
This can be achieved through the use of recycled materials, installation of renewable energy systems, selection of environmentally friendly build sites, and creation of healthy indoor environments.
If you're aiming for a specific certification, the certification agency may have its own definition and set of criteria you'll need to follow to qualify your facility as a green building.
The Tech Behind Sustainable Building Success: Smart Tools and Devices
Constructing and keeping your building green requires constant monitoring and adjustment. This is where technology and IOT devices step in to save the day.
With the use of smart technologies and real-time monitoring systems, you can keep a close eye on things like energy usage, water conservation, and air quality, resulting in significant savings of both time and money.
For example, with a platform like Attune, you can detect and track water usage, air quality, and HVAC operation, all with one system. And with the help of automation and alerts, you can address issues such as water leaks and pump problems early.
How Attune Helps Make Green Buildings Smarter
Maintaining and improving your building’s green status is made simple with the Attune platform. With sensors for everything from carbon dioxide and volatile organic compounds (VOCs) to humidity and energy usage, real-time monitoring has never been easier. Plus, with our modular approach, you can customize, expand, and upgrade as needed.
Whether you run a school, lease out a commercial office, or are searching for solid ESG strategies, getting started with Attune can help you achieve your green goals.
