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Investing in Building Efficiency Is Smart As Well As Green

By Daniel Stouffer

Republish: EasyPublish™ Published: 11Sep2010 Word count: 411 Viewed: 308 time(s) Get Free Content For Your Site

As institutional investors and stakeholders begin to realize the value of investing in efficient buildings, a push for green building has taken root across industries. This trend is evident within companies and investment trusts that are making sure they increase their portfolio of properties that have a green classification that proves building efficiency.

Real estate investment trusts are turning to the Leadership in Energy and Environmental Design (LEED) program to establish credentials for building stocks. More than a third of real estate investment trusts across the county are seeking LEED certification or certified buildings.

Buildings account for 60% of global greenhouse gas emissions and companies must ensure that they address building efficiency as they move toward corporate sustainability. Investors are aware that they can realize a premium in terms of occupancy and return on investment by concentrating on green initiatives.

It is interesting to note that, despite the downturn, interest in green investments remains high. Investors looked into long-term practicality of building efficiency investments, and continued to pursue sustainable opportunities. Energy efficiency is a hot topic conversation among building owners and occupiers alike.

Building occupants are pursuing leases at buildings with high efficiency rates and LEED certifications. This push shows that leaseholders are increasingly interested in operating their businesses in an efficient manner. Tenants are insisting that building they occupy are 'green' and they have the certification to prove it because employees and customers demand it.

The market has shown that tenants are willing to pay a premium to occupy space that is classified according to LEED standards. Owners are well aware that they are more likely to retain tenant occupancy and gain premium rates if they make the investment in building efficiency now.

Investors have also noticed that upgraded and efficient buildings then to have lower operating costs and represent a more efficient and manageable investment. When coupled with proactive, energy-conscious tenants, owning or investing in a 'green' building can be a smart decision.

While green buildings can cost as much as 5% more to actually construct, these costs are absorbed through operational efficiencies within the first few years of operation. The real estate investment trust business has been actively involved in the pursuit of building efficiency since they introduced their Leader in the Light program, back in 2005.

Building efficiency standards will undoubtedly increase exponentially as society comes to demand an approach to energy efficiency and sustainability, and should be a priority issue to tackle in the boardroom at the present time.

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