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The Business Case for Green Building
By Tyler Collins

Do green buildings attract a financial premium in terms of rental and sales value? Are they more attractive to tenants and occupiers? Are employees occupying greener buildings more productive?

A new report from the World Green Building Council (WorldGBC), "The Business Case for Green Building: A Review of the Costs and Benefits for Developers, Investors and Occupants" evaluates global research to answer these questions.

The report’s key findings include:

  • The cost premium is not as high as generally perceived. The additional costs can be significantly reduced through initial strategies and program management.
  • Green buildings are able to more easily attract tenants and to command higher real estate value. In some of the more eco-minded markets, there is a growing prevalence of “brown discounts” where buildings that are not green may rent or sell for less.
  • Green buildings have been shown to save money through reduced energy and water use and lower long-term operations and maintenance costs; these savings typically exceed any construction cost premiums within a short time period.
  • Research shows that green designed buildings can improve worker productivity, health, and well being, resulting in gains to companies’ bottom line.
  • Green building helps reduce exposure to sustainability risk factors—regulatory, weather, and consumer preferences—can negatively impact the rental income and the future value of real estate assets.
  • Increasing the sustainability of the large-scale built environment, can help to achieve macroeconomic priorities, including climate change mitigation, energy security, resource conservation and job creation, long-term resilience and quality of life.

"From risk mitigation across a building portfolio and city-wide economic benefits, to the improved health and well-being of individual building occupants, the business case for green building will continue to evolve as markets mature,” said Jane Henley, CEO of WorldGBC.

As the world’s leading green building organization, the World Green Building Council is a network of national Green Building Councils (GBCs) from around the world.

Posted: April 26, 2013