The Proof Is In! Green Buildings Get Higher Rents, Have Greater Occupancy, Says Just-Released Study

A November 2007 study of more than 200 buildings by University of San Diego professor Norman Miller shows that Energy Star office buildings over 200,000 sq.ft. get about two percent greater occupancy and about $2 per sq.ft. greater rents, along with $0.54 per sq.ft. lower operating costs and 30% higher resale value. Isn’t the debate just about over, whether green buildings are a benefit to developers?

The first systematic study of occupancy rates and rents for Energy Star certified large Class A office buildings (some 223) vs. non-Energy Star certified buildings (some 2,077), showed that as of the second quarter of 2007, Energy Star buildings had about 2 percent higher occupancy rates and $2 per sq.ft. greater rents. If the cost of adding energy efficiency features necessary to get an Energy Star rating is $4 per sq.ft., for example, then the payback, just on rents, is 2 years, not counting the benefit of extra occupancy. Operating costs for these buildings run $0.54 per sq.ft. lower. The authors state, “together, the higher occupancy rates, higher rents and lower operating costs translate to significantly higher values. Our results show higher sales prices by 30% more per square foot.”

Posted by on 11/20/2007 at 02:05 PM