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Sustainability offers a range of economic, environmental, and social benefits for owners, their investors, tenants, and regulatory authorities. Through integrating sustainable design and practices in their properties, owners are able to not only secure numerous advantages, but also minimize critical concerns in the built environment for years to come.
Long-Term ROI: While sustainable features may require an initial investment, the long-term return on investment (ROI) is often substantial and makes sustainability financially beneficial due to reduced operational costs, increased property value, and potential tax incentives.
Reduced operational costs: Sustainable buildings are designed to be more energy-efficient, whether that’s through LED lighting or advanced HVAC systems, which all significantly reduce the costs to operate buildings day-to-day. If the owner is responsible for shouldering the brunt of those expenses, any costs savings along the way will benefit the financial bottom line.
Increased property value: Buildings that include sustainability elements are often more attractive to potential buyers and tenants who value healthy, eco-friendly, and energy-efficient environments for themselves and their employees or families. Sustainable buildings also tend to be more competitive in the real estate market demanding higher resale values, along with commanding higher rents with long-term tenants, providing owners with a quicker ROI.
Resilience and Adaptation: With a changing climate, both in terms of environmental and market conditions, owners must prepare their assets to mitigate risks. Sustainable buildings are designed to minimize risks associated with extreme weather events, climate change impacts, energy price fluctuations, resource scarcity, and shifting environmental regulations. Owners who invest in sustainability are more resilient and better positioned to adapt to changing circumstances.
Owners, investors, and developers have a front-line role in reducing embodied carbon within their projects and developments. By setting project requirements early that prioritize carbon considerations, owners set the tone and expectations for the entire life cycle of the project.
Energy usage and efficiencies in the built environment can be tricky for building owners. On one hand, owners who finance the energy bills themselves have a stronger incentive to ensure systems are working properly, tenants are educated and aware of efficiency processes, and that the energy performance of the building is optimized. On the other hand, owners who have triple net lease or tenants who cover utilities, are less incentivized to oversee energy efficiency behaviors as they’re not footing the bill. However, buildings with energy efficient designs (i.e., LEED, ENERGY STAR, BREEAM) typically garner higher lease rates and have lower embodied carbon for the owner’s portfolio, which can help set them apart from competitors.
Owners, investors, and developers can sometimes be seen as being removed from the whole process. But when it comes to sustainable concepts, specifically waste, knowing that an owner/investor/developer has waste reduction as a priority from the start of a project helps everyone align to the same goals and achieve the best outcome. By setting project requirements early that prioritizes waste reduction, owners set the tone and expectations for the entire life cycle of the project.
It’s vital that owners vocalize making water a priority from the beginning of each project, including through funding. Ensuring that architects, designers, procurement professionals, and engineers are all aligned behind this goal streamlines the focus of the project and provides clarity to the sometimes dispersed project teams.
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