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Burnham-Moores Center for Real Estate releases green building study

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The University of San Diego’s Burnham-Moores Center for Real Estate has published the next phase in its multiyear national study of commercial office building tenants in green and non-green buildings. The first phase of the study looked at the difference in rents between tenants in green and non-green buildings. The new phase, which was recently presented at GreenBuild 2010, focuses on the attitudes toward sustainability among commercial building tenants.

The study, conducted by researchers at the Burnham-Moores Center, CB Richard Ellis and McGraw-Hill Construction, looked at a portfolio of 158 office buildings managed by CBRE in major markets nationwide. The survey included 442 tenant firms, roughly one-third of which are in the financial and legal services industries. At the time of the survey, 52 percent of respondents occupied buildings that had received Leadership in Energy and Environmental Design (LEED) certification, and 10 percent occupied buildings that were undergoing the certification process.

Corporate sustainability practices

In the survey, each tenant firm was asked whether it had staff dedicated to environmental or sustainable issues, whether it had organized a green team to implement sustainable practices and whether it had a formal written policy on sustainable goals that was shared with employees. Thirty-eight percent of the respondents had dedicated staff, 29 percent had a green team and 32 percent had a formal written policy.

More tenants in LEED buildings had implemented all three sustainability practices than tenants in non-LEED buildings. As numerous studies have shown, rents in green buildings are higher than non-green buildings with otherwise comparable features. Firms that consider sustainability a high priority are more likely to pay the premium to occupy green office space.

In terms of size, larger firms had implemented more sustainability-related practices -- particularly formal written policies and green teams -- than smaller firms.

How important are green features?

Researchers also asked survey respondents to assess the importance of 10 common features in green buildings on a one to five scale, with five being the most important. Across all respondents, a healthy indoor environment was considered the most important, while daylight and views were ranked second. When the responses were broken down based on the type of space -- LEED vs. non-LEED buildings -- there was no significant difference in the green features rankings.

When the type of organization was taken into account, the results showed that nonprofit organizations and public firms valued green features much more than private firms. While there was no significant difference between nonprofits and public firms in terms of average ratings, the rankings were significantly different. For nonprofits, recycling programs and convenient access to public transportation were ranked second and third, following a healthy indoor environment. Public firms rated these same features third and sixth.

Larger firms -- those with more than 100 employees -- considered green features more valuable than smaller firms, particularly those with five or fewer employees. The largest firms also ranked access to public transportation significantly higher than the smallest companies did.

Impact on stakeholders

More than 60 percent of survey respondents agreed that green space is important to current employees, about a third of the sample were neutral on the topic and 4 percent said it wasn’t important. The majority of tenants -- 52 percent -- didn’t think green space played a significant factor in attracting prospective employees, although most tenants did feel that being in a green space would help retain employees. Around 60 percent of respondents agreed that green office space is important in creating a favorable impression on clients and customers and to maintain a positive public image.

For publicly traded firms, the most important reason to occupy green space was public image, followed by customers and clients. In contrast, nonprofit organizations were more concerned about how green space might affect their current employees.

To receive a copy of the full study, contact Jeryldine Saville of the Burnham-Moores Center for Real Estate, at jsaville@sandiego.edu.

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