The push to green American office buildings may now come from the German commercial real estate investment company, Jamestown Properties. According to a recent article in The New York Times, Jamestown, which invests its money through private equity funds, has plans to green almost its entire $4 billion portfolio of buildings, all of which are located here in the United States.
“We come at things from a bit of a European perspective, and Europe is far ahead of the United States in the environment movement,” said Matt Bronfman, Jamestown’s managing director and chief operations officer.
So far ahead, that “Europe has made green architecture an everyday reality,” wrote Nicholai Ouroussoff in a New York Times magazine piece back in 2007. “By the mid-90s, all new construction in Europe had to meet basic requirements in energy consumption, and many European architects began to make sustainability a central theme in their work,” Ouroussoff reported.
By contrast, the U.S. still doesn’t have national green building standards, at least not yet. The American Clean Energy and Security Act, also known as the Waxman-Markey bill, would create them. The closest we have right now are the mostly voluntary LEED (Leadership in Energy and Environmental Design) guidelines, which were developed by the U.S. Green Building Council over ten years ago. The good news is that some local zoning codes and other laws now use LEED as a point of reference, and they are becoming a de facto requirement for “Class A” buildings.
Let’s hope the trend continues. Until recently, plenty of companies in the U.S. have ignored the energy efficiency of their buildings. Why? Time and money certainly play a big role for some landlords. And tenants who don’t own their spaces may not want to make an investment they won’t be able to recover when their leases are up. But when you consider that buildings here generate about 40% of the country’s–not to mention the world’s–energy use and about the same in greenhouse gas emissions–it’s nothing short of mind boggling from an environmental standpoint. In fact, by many estimates, the average building in the U.S. uses about a third more energy than its German equivalent.
If Jamestown, which is based in Cologne and Atlanta and has invested $12 billion in commercial properties in the U.S. since 1983, is any indication, the needle is moving in the right direction – both for developers, and tenants.
“Jamestown’s green building initiatives appeal to consumers in the current real estate market because of the environmentally conscious approach the company is taking,” Bronfman told me in an email.
The company said it would spend $3 to $10 million to retrofit its properties. It’s just about finished converting an Atlanta building it purchased in 2007. The office tower at 999 Peachtree Street, originally developed in 1987, today has tenants who follow sustainable practices. A bike share program, carpooling, recycling and energy-efficient lighting (which the Times estimates saves 476,000 kilowatt hours a year), and even a Zipcar station have earned it gold certification from the U.S. Green Building Council.
Another Jamestown property going for the gold is an older office building, built in 1968, at 1250 Broadway in New York City. An energy audit alone made an enormous difference, leading to a 15% reduction in annual energy consumption and carbon emissions.
“It’s things as mundane as adjusting the fan speeds or repairing or upgrading controls,” Katharine Kelley, president and CEO of Green Street Properties, a Jamestown subsidiary focused on environmental sustainability, explained to the Times. Jamestown joined forces with Green Street Properties a few years ago to accelerate its push for green.
Time will tell whether or not it makes good business sense, although Jamestown is certainly banking on it.
“We see going green as a good investment but we also believe it is the right thing to do,” asserts Bronfman.
He expects to recoup costs through energy savings, the ability to charge higher rents, and higher resale values.
“There is a recent study out of London touting the advantages of going green in terms ability to attract and retain tenants and with respect to the cap rate that can be achieved on exit,” Bronfman says.
And Kelley told the Times that Jamestown will recoup, within a year, the $350,000 it invested in 1250 Broadway as a result of increased efficiency.
With a recent study by the World Business Council for Sustainable Development (WBCSD), and reported in the Financial Times, showing that good practice can substantially reduce greenhouse gas emissions by as much as 70 to 80 percent, isn’t it time to take the risk?
Read more: atlanta, building initiatives, cologne, developers, eco friendly, environmentally friendly, going green, green, green businesses, green construction, green street properties, greenhouse gases, jamestown, new york city
photo credit: thanks to Jamestown Properties for the image
Suzi Schiffer Parrasch
Disclaimer: The views expressed above are solely those of the author and may
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