The World Green Building Council Makes “The Business Case for Green Building”

Is green building a wise business decision? That is the fundamental question the World Green Building Council’s report, “The Business Case For Green Building,” attempts to address. The report compiles actual cost and benefit data from peer-reviewed publications and includes numerous case studies of projects throughout the world. This evidence-based report identifies five primary factors that affect a decision whether or not to implement green building practices in both for new construction and renovation projects. The five factors and key conclusions are:

• Design and Construction Costs: cost premiums for green buildings are not as high as perceptions in the development industry; long-term costs savings often offset upfront cost premiums

• Asset Value: green buildings in some markets easily attract tenants and command higher rents; some markets have “brown discounts,” where buildings that are not green rent or sell for less than comparable green buildings

• Operating Costs: green buildings reduce energy and water consumption resulting in lower long-term operating costs; the savings typically exceed design and construction premiums within a reasonable payback period

• Workplace Productivity and Health: investing in higher quality indoor environments can improve employee productivity and health, resulting in greater benefits to employers

• Risk Mitigation: incorporating green building practices can positively affect future rental incomes and future value of assets reducing investment risk

Interestingly, the World Green Building Council did not direct this report at any one specific project stakeholder. Rather, it provides data relevant to three key green building decision makers: developers, owners and occupants. For example, the report describes the potential for increased market values of green buildings, a concept important to both developers and owners. Likewise, the report identifies the green building benefits of reduced facility downtime and lower operating costs, concepts important to both owners and occupants.

By quantifying the costs and benefits of green building, this report is a great resource to those tasked with deciding whether or not to implement sustainable strategies and technologies in a project. Overall, the report should be very helpful to decision makers considering the short and long term impacts of green building and may be the roadmap necessary to make an informed business decision on their next project.

Jason C. Spang, P.E., Esq.

Read more at Sustainability-Counsel.com from Pepper Hamilton LLP's Sustainability, CleanTech and Climate Change Team.

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