I N R E A L E S TAT E ,
G R E E N S T I L L M AT T E R S
M A T T D O H E N Y
• The global real estate market has definitely seen an increase
towards the greener end of the spectrum in recent years.
• Due to the effect that our collective environmental footprint has
on the world around us, architects, builders, and consumers have
placed an added emphasis on sustainability when it comes to real
estate developments and investments.
• The benefits of incorporating a greater environmental awareness into your own
personal lifestyle are difficult to dispute.
• For years, we have been hearing about the financial rewards of managing energy
• Yet, do potential tenants care enough about such
benefits to make them worth incorporating greener
amenities into their residential and commercial
• Recent research seems to indicate that they do.
• A joint study commissioned by the University of California at
Berkeley and the Netherland’s Maastricht University compared the
rental and sales rate premiums of LEED (Leadership in Energy
Efficiency Design) and Energy Star-certified buildings to standard
properties across the U.S.
H ER E ’ S W H AT TH E I R
F I N D I N G S S H O W E D :
• A 3 percent rental rate premium
• An 8 percent effective rental rate premium
• A 13 percent sales premium
• Given the apparent advantages that green properties offer, the
challenge then becomes finding cost-effective methods to
incorporate green technologies into your new developments, and
retrofitting your current properties with them.
• Finding a capable green builder in your area may
come at a higher cost, but can be recouped in sale
or leasing costs, or through tax credits and savings.
• For your existing properties, the extra expense of retrofitting
is one that most researchers have found can be offset on its
• The website GreenandSave.com has shown that simple
updates such as installing more energy-efficient windows
and doors, sealing air leaks, and adding extra insulation
tend to pay for themselves through energy savings in as
little as 2.5 years.
• Factor in added appeal of
offering a green property
for sale or rent to other
investors, and you can see
how much such an
investment can pay off.
The motives behind your move to a greener focus on your current
and potential real estate holdings notwithstanding, being more
eco-friendly with your home and/or office building offers the
satisfaction of knowing that you’re doing your part.