The Business Case For Green Building Report
The report, “The Business Case for Green Building: A Review of the Costs and Benefits for Developers, Investors and Occupants,” examines whether or not it’s possible to attach a financial value to the cost and benefits of green buildings. Today, green buildings can be delivered at a price comparable to conventional buildings and investments can be recouped through operational cost savings and, with the right design features, create a more productive workplace.
Key findings of the report include:
Design and Construction Costs: There has been an overall trend towards the reduction in design and construction costs associated with green building as building codes around the world become stricter, supply chains for green materials and technologies mature and the industry becomes more skilled at delivering green buildings;
Asset Value: As investors and occupiers become more knowledgeable about and concerned with the environmental and social impacts of the built environment, buildings with better sustainability credentials will have increased marketability. Additionally, there is a demonstrated link between the green characteristics of buildings and the ability of these buildings, in some markets, to more easily attract tenants and to command higher rents and sale prices;
Operating Costs: Green buildings have been shown to save money through reduced energy and water consumption and lower long-term operations and maintenance costs. The energy savings alone typically exceed any cost premiums associated with their design and construction within a reasonable payback period;
Workplace Productivity and Health: There is an emerging body of evidence suggesting that the physical characteristics of buildings and indoor environments can influence worker productivity and occupant health and well-being, resulting in bottom line benefits for businesses;
Risk Mitigation: Sustainability risk factors can significantly affect the rental income and the future value of real estate assets, in turn affecting their return on investment. Regulatory risks have become increasingly apparent in countries and cities around the world, including mandatory disclosure, building codes and laws banning inefficient buildings.
The report concludes that by greening our built environment at the neighborhood and city scales, the green building industry can deliver on large-scale economic priorities such as climate change mitigation, energy security, resource conservation and job creation, long-term resilience and quality of life.
This report was produced in partnership with PRP Environmental along with the following sponsors: Skanska, Grosvenor, and the Abu Dhabi Urban Planning Council/Estidama.
