The CBRE Green Building Adoption Index 2014 analyzes the adoption of sustainable building practices across the top 30 US markets, revealing a significant growth in certified green buildings from 2005 to 2013. Key findings indicate that Minneapolis, San Francisco, and Chicago lead in green building certifications, while cities like Pittsburgh and Kansas City show the lowest adoption rates. The report highlights the importance of government regulations and tenant demand in influencing green building initiatives.

1. CBRE presents
Green Building Adoption Index 2014
June 2014

2. GREEN BUILDING ADOPTION INDEX
About the Real Green Research Challenge
 $1,000,000 academic challenge launched in 2012
 Developed to support academic work seeking sustainable
solutions for the built environment
 Provides both funding and active access to CBRE platform,
clients and personnel to assist in pursuing projects
 Five projects underway: Green Building Adoption Index
(GBAI) is first published project
© 2014 CBRE 2

3. GREEN BUILDING ADOPTION INDEX
About GBAI
Chief objective: quantify and understand the dynamics of certified green building
space in the top 30 US markets
Led by Dr. Nils Kok, Maastricht University
collaboration with Rogier Holtermans, Maastricht University
Data provided by USGBC and CBRE Research
 3.5 billion square feet
 34,000 buildings
© 2014 CBRE 3

4. GREEN BUILDING ADOPTION INDEX
About GBAI
Two primary programs assess and identify building energy efficiency and sustainability
characteristics for office buildings
 EPA Energy Star
• 8,405 office buildings
• 1.9 billion feet
 USGBC LEED certification
• 5,470 office buildings
• 970 million feet
© 2014 CBRE 4

5. LEED ADOPTION PER 2013
Top 10 states by number of projects
Rank State Projects Square footage (million) Per capita sq. ft.
1 California 595 72.73 1.95
2 New York 259 37.84 1.95
3 Illinois 171 29.42 2.29
4 Virginia 160 16.87 2.11
5 Colorado 124 8.89 1.77
6 North Carolina 133 17.18 1.80
7 Maryland 119 12.70 2.20
8 Washington, D.C.* 106 19.52 32.45
9 Massachusetts 101 13.68 2.09
10 Minnesota 51 8.21 1.55
Source: USGBC, 2014
*While D.C. is not a state, its LEED activity warranted inclusion
© 2014 CBRE 5

6. LEED ADOPTION PER 2013
Top 10 states by per capita square footage
Rank (by projects) State Projects Square footage (million) Per capita sq. ft.
1 (8) Washington, D.C.* 106 19.52 32.45
2 (3) Illinois 171 29.42 2.29
3 (7) Maryland 119 12.70 2.20
4 (4) Virginia 160 16.87 2.11
5 (9) Massachusetts 101 13.68 2.09
6 (1) California 595 72.73 1.95
6 (2) New York 259 37.84 1.95
7 (none) Oregon 47 6.99 1.83
8 (6) North Carolina 133 17.18 1.80
9 (5) Colorado 124 8.89 1.77
10 (10) Minnesota 51 8.21 1.55
Source: USGBC, 2014
*While D.C. is not a state, its LEED activity warranted inclusion
© 2014 CBRE 6

7. ENERGY STAR CERTIFICATIONS IN 2013
Top 25 cities with the most certified buildings
Rank Metro area # of buildings Square footage (million) Cost savings (million) Emissions prevented
1 Los Angeles 443 102.7 $132.2 45,100
2 Washington, DC 435 109.1 $119.0 69,800
3 Atlanta 318 70.4 $53.4 52,500
4 New York 303 113.8 $142.4 58,700
5 San Francisco 289 74.7 $110.1 36,400
6 Chicago 233 116.2 $91.3 105,900
7 Dallas-Fort Worth 229 60.1 $43.9 42,600
8 Denver 221 43.5 $40.2 50,200
9 Philadelphia 210 34.5 $28.1 21,700
10 Houston 204 82.6 $66.4 61,600
11 Charlotte 176 23.0 $13.7 11,400
12 Phoenix 156 24.2 $34.5 29,800
13 Boston 141 38.5 $50.0 19,600
14 Seattle 127 25.5 $23.6 13,000
15 San Diego 123 17.2 $39.6 7,500
16 Minneapolis-St. Paul 116 42.1 $51.4 52,700
17 Sacramento 109 15.0 $21.1 7,900
18 Miami 101 22.2 $20.7 18,200
19 Cincinnati 84 17.2 $11.3 13,600
20 San Jose 83 10.7 $17.3 6,500
21 Columbus, Ohio 77 12.2 $11.6 12,100
22 Riverside, Calif. 75 8.5 $7.2 2,500
23 Detroit 73 15.5 $15.6 16,300
24 Portland, Ore. 71 11.5 $9.1 5,800
25 Louisville 60 6.5 $5.7 6,700
© 2014 CBRE 7
Source: Energy Star, 2014

8. ENERGY STAR CERTIFICATIONS IN 2013
Ranking changes depending on the measure
Rank Metro area # of buildings Square footage (million) Cost savings (million) Emissions prevented
6 Chicago 233 116.2 $91.3 105,900
4 New York 303 113.8 $142.4 58,700
2 Washington, DC 435 109.1 $119.0 69,800
1 Los Angeles 443 102.7 $132.2 45,100
10 Houston 204 82.6 $66.4 61,600
5 San Francisco 289 74.7 $110.1 36,400
3 Atlanta 318 70.4 $53.4 52,500
7 Dallas-Fort Worth 229 60.1 $43.9 42,600
8 Denver 221 43.5 $40.2 50,200
16 Minneapolis-St. Paul 116 42.1 $51.4 52,700
13 Boston 141 38.5 $50.0 19,600
9 Philadelphia 210 34.5 $28.1 21,700
14 Seattle 127 25.5 $23.6 13,000
12 Phoenix 156 24.2 $34.5 29,800
11 Charlotte 176 23.0 $13.7 11,400
18 Miami 101 22.2 $20.7 18,200
15 San Diego 123 17.2 $39.6 7,500
19 Cincinnati 84 17.2 $11.3 13,600
23 Detroit 73 15.5 $15.6 16,300
17 Sacramento 109 15.0 $21.1 7,900
21 Columbus, Ohio 77 12.2 $11.6 12,100
24 Portland, Ore. 71 11.5 $9.1 5,800
20 San Jose 83 10.7 $17.3 6,500
22 Riverside, Calif. 75 8.5 $7.2 2,500
25 Louisville 60 6.5 $5.7 6,700
© 2014 CBRE 8
Source: Energy Star, 2014

9. GREEN BUILDING ADOPTION INDICES
Diffusion of LEED and Energy Star (2005 – 2013)
Measuring the fraction of green in the CRE market
Geographic boundaries for the 30 largest CBRE markets
Identification of labeled office space per market
LEED and Energy Star
• Office only
• Tracking threshold
• No LEED CI
• No medical or government occupied
buildings
Label vintage
• Correct for label “depreciation”
• 5 years for LEED
• 2 years for Energy Star
Ratios
• Number of buildings
• Sq. ft. of space
Developed in partnership with the
USGBC and CBRE
© 2014 CBRE 9

10. NATIONAL ADOPTION OF LEED AND ENERGY STAR
Significant growth over past decade
© 2014 CBRE 10

11. NATIONAL ADOPTION OF ENERGY STAR LABELS
Growth in diffusion seems to slow
© 2014 CBRE 11

12. NATIONAL ADOPTION OF THE LEED PROGRAM
Later start, rapid increase in past five years
© 2014 CBRE 12

13. BREAKING DOWN THE DIFFERENT LEED PROGRAMS
LEED EB accelerates diffusion
© 2014 CBRE 13

14. ADOPTION ACROSS LEED PROGRAMS
LEED EB accounts for 75%
© 2014 CBRE 14

15. NATIONAL FINDINGS
2005 2013
Total sq. ft. of Green buildings 5.6% 39.3%
Total # of Green Buildings 1.5% 13.2%
Total sq. ft. of Energy Star Labeled 5.1% 30.3%
Total # of Energy Star Labeled 1.3% 10.2%
Total sq. ft. of LEED certified .40% 19.4%
Total # of LEED certified .14% 5.1%
Total sq. ft. of LEED EB certified .11% 15.4%
Total # of LEED EB certified .03% 3.1%
© 2014 CBRE 15

16. TOP 10 GREENEST CITIES
Highest percentage of green building square footage
Rank Market Square footage
1 Minneapolis 77.0%
2 San Francisco 67.2%
3 Chicago 62.1%
4 Houston 54.8%
5 Atlanta 54.1%
6 Los Angeles 49.7%
7 Denver 49.3%
8 Seattle 46.6%
9 Miami 46.0%
10 Washington, D.C. 42.2%
© 2014 CBRE 16

17. GREEN CHALLENGED CITIES
Lowest percentage of green building square footage
Rank Market Square footage
30 Pittsburgh 10.0%
29 Kansas City 13.5%
28 Stamford 13.9%
27 Detroit 16.3%
26 Baltimore 16.9%
25 New Jersey 17.2%
24 Milwaukee 20.0%
23 St. Louis 24.2%
22 Tampa 27.0%
21 Phoenix 28.0%
20 Portland 30.8%
© 2014 CBRE 17

18. #1 MINNEAPOLIS
Determinants
Regulation: Chapter 47.190’s Commercial Building Rating &
Disclosure Ordinance, ≥ 50,000 sq. ft. buildings use Energy Star
and water use tracking
Tenant demand: Market values green; deep cultural embedment
Facts
EPA ranking*: 16th
1st LEED building: Karges-Faulconbridge Office Building
 LEED EB, Gold, 2004
Interesting building: 7601 Penn Avenue South
 10x Energy Star, LEED EB Gold
*”Top 25 Cities with the Most ENERGY STAR Certified Buildings” 2014 Note: Green building adoption in percent until December 31, 2013
© 2014 CBRE 18

19. #2 SAN FRANCISCO
Determinants
Regulation: Assembly Bill 1103, buildings >5,000 sq. ft. must use
Energy Star Portfolio Manager; Existing Comm’l Buildings Energy
Performance Ordinance, >10,000 sq. ft. report Energy Star, ASHRAE
level 1-2 audits; Green Building Ordinance, 5-25,000 sq. ft. buildings
use LEED Checklist; Ordinance N 88-04; Director’s Bulletin
Tenant demand: Fortune 500 HQs; global and national investment
target city; technology and financial services industries
Facts
EPA ranking*: 5th
1st LEED building: 260 Townsend, Swinerton HQ
 LEED EB, Gold, 2004
Interesting building: 101 California Street
 12x Energy Star, LEED EB Certified and Platinum
*”Top 25 Cities with the Most ENERGY STAR Certified Buildings” 2014 Note: Green building adoption in percent until December 31, 2013
© 2014 CBRE 19

20. #3 CHICAGO
Determinants
Regulation: Chicago Green Permit Program prioritizes permits
and waives fees for projects seeking LEED; Building Energy Use
Benchmarking Ordinance requires >50,000 sq. ft. projects to
report Energy Star
Tenant demand: Corporate HQs; global investment target city;
business services industry
Facts
EPA ranking*: 6th
1st LEED building: 111 South Wacker Drive
 LEED CS, Gold, 2005
Interesting building: Union Tower
 5x Energy Star, LEED EB Silver
*”Top 25 Cities with the Most ENERGY STAR Certified Buildings” 2014 Note: Green building adoption in percent until December 31, 2013
© 2014 CBRE 20

21. #4 HOUSTON
Determinants
Regulation: Resolution 2004-15, city-owned buildings >10,000
sq. ft. target LEED Silver
Tenant demand: Oil & gas industry offsetting environmental risk;
corporate HQ’s
Facts
EPA ranking*: 10th
1st LEED building: Kirksey Corporate Office Building
 LEED EB, 2006
Interesting building: Three Allen Center
 5x Energy Star, LEED EB Gold
*”Top 25 Cities with the Most ENERGY STAR Certified Buildings” 2014 Note: Green building adoption in percent until December 31, 2013
© 2014 CBRE 21

22. #5 ATLANTA
Determinants
Regulation: City funded projects > 5,000 sq. ft. or $2M to be
LEED Silver; exemptions follow LEED checklist
Tenant demand: Fortune 500 and other high-profile companies;
insurance industry
Facts
EPA ranking*: 3rd
1st LEED building: Arthur M. Blank Family Office
 LEED Gold, 2004
Interesting building: Northcreek Office Park Building
 20x Energy Star, LEED EB
*”Top 25 Cities with the Most ENERGY STAR Certified Buildings” 2014 Note: Green building adoption in percent until December 31, 2013
© 2014 CBRE 22

23. #29 KANSAS CITY
Determinants
Regulation: Ordinance 110235, all new municipal buildings
>5,000 sq. ft. earn LEED Gold
Tenant demand: Lacks sustainably-oriented industries like
technology, life sciences, creative industries and government
Facts
EPA ranking*: not ranked
1st LEED building: EcoWorks at Southlake Phase One
 LEED NC, 2002
Interesting building: Lighton Plaza and Tower
 5x Energy Star, 2x LEED EB Silver
*”Top 25 Cities with the Most ENERGY STAR Certified Buildings” 2014 Note: Green building adoption in percent until December 31, 2013
© 2014 CBRE 23

24. #30 PITTSBURGH
Determinants
Regulation: All Tax Increment Financing and new construction on
municipal property ≥10,000 sq. ft. or >$2M must be LEED
Silver. Sustainable Development Bonus, 20% density and height
bonus for LEED NC or CS certification
Tenant demand: Small technology and creative industry presence;
lacks other sustainably-oriented industries
Facts
EPA ranking*: not ranked
1st LEED building: PNC Firstside Center
 LEED Silver, 2000
Interesting building: 525 William Penn Place
 5x Energy Star, LEED EB
*”Top 25 Cities with the Most ENERGY STAR Certified Buildings” 2014 Note: Green building adoption in percent until December 31, 2013
© 2014 CBRE 24

25. TAKEAWAYS
Understanding the supply of green building space
Large geographic variation in adoption of LEED and Energy Star
 Minneapolis, San Francisco and Chicago are leading
 Pittsburgh, Kansas City and Detroit display lowest adoption
Green-certified buildings represent a major share of the office market
 13% of office buildings hold a certification compared to just 1.5% in 2005
 39% of the stock of office space certified compared to less than 6% in 2005
Technology seems to diffuse faster in larger buildings
Some markets may have reached a saturation point
Markets with overall low adoption show promising growth in adoption of certification for new construction
© 2014 CBRE 25

26. WHAT’S NEXT?
Study updated annually
Focus on impacts of:
 City/state disclosure rules
 Tougher LEED EB IV standards
 Updated 2012 EPA Energy Star CBECS data on scores and certification level
Correlate with rents, occupancy and asset value
 Update 2007/2010 research
 Focus on performance attribution
© 2014 CBRE 26

27. THE GREEN BUILDING ADOPTION INDEX
Q & A
© 2014 CBRE 27