Research indicates that green certification lowers the cost of capital for real estate investors, according to a recent column at GlobeSt.
The reasoning is that certified buildings have a more attractive risk profile and may be more resilient during tough economic times, according to Dr. Nils Kok, associate professor at Maastricht University, the article says. Some studies have shown that commercial mortgages for green-certified buildings have significantly lower default rates.
Indeed, evidence is growing bolstering the notion that sustainability correlates with stronger financial performance in the commercial real estate sector. One recent report found that buildings certified by ENERGY STAR and/or LEED sell for about 10.1% more than non-green certified buildings. Green buildings were found to lease for rates that are 2.2% higher than average, and effective cash flows are 4.6% higher.
Additional data indicates that there is a rapidly growing market for green bonds that invest funds for new sustainable buildings and renovations of existing structures.
Related Stories
Codes and Standards | Feb 9, 2022
Climate impact of gas stoves in U.S. equal to half a million cars
New study could increase momentum to ban fossil fuels in new buildings.
Codes and Standards | Feb 7, 2022
Energy efficiency ratings not reflecting true energy use
Highest rated U.K. buildings are less efficient than lower rated ones.
Codes and Standards | Feb 3, 2022
Illinois tops USGBC list of states with the most LEED certified projects in 2021
Top 10 states plus D.C. certified more than 247 million gross square feet.
Codes and Standards | Feb 2, 2022
Public works contracting reform advances in New York State
Governor signs bill to form advisory council that will propose policy changes.
Codes and Standards | Feb 2, 2022
Commercial and multifamily construction starts rebounded in 2021
Following COVID uncertainty in 2020, the industry recovered, but still lags 2019 levels.
Codes and Standards | Feb 1, 2022
Biden Administration launches state, local coalition to boost building performance standards
Will focus on energy efficiency and electrification across the buildings sector.
Codes and Standards | Jan 26, 2022
Downtown digital twin to aid Las Vegas in setting policy priorities
Will be used to address energy use, emissions, traffic, parking, noise, and emergency management.
Codes and Standards | Jan 25, 2022
Modeling tool helps compare options for HVAC systems when little known about a building
Compares projected costs and energy usage for all HVAC systems and hot water consumption.
Codes and Standards | Jan 25, 2022
Critics slam proposed revamp of California’s solar net energy metering rate
Could make rooftop solar panels unaffordable for most customers.
Sponsored | Resiliency | Jan 24, 2022
Norshield Products Fortify Critical NYC Infrastructure
New York City has two very large buildings dedicated to answering the 911 calls of its five boroughs. With more than 11 million emergency calls annually, it makes perfect sense. The second of these buildings, the Public Safety Answering Center II (PSAC II) is located on a nine-acre parcel of land in the Bronx. It’s an imposing 450,000 square-foot structure—a 240-foot-wide by 240-foot-tall cube. The gleaming aluminum cube risesthe equivalent of 24 stories from behind a grassy berm, projecting the unlikely impression that it might actually be floating. Like most visually striking structures, the building has drawn as much scorn as it has admiration.