Articles Posted in Green Building

Downtown Los AngelesAmid much fanfare, in 2008 the Los Angeles City Council established the Green Building Program requiring, among other things, that most new structures over 50,000 square feet in size be built to the United States Green Building Council (“USGBC”) Leadership in Environmental and Energy Design (“LEED”) basic “Certified” standard. To incentivize projects of any size attaining LEED “Silver” or higher equivalence, priority processing was offered. The third element of the City’s Green Building Program was to establish an inter-departmental Green Team to implement and recommend refinements to the Green Building Program. Since then, 28 projects have met the LEED Certified level and an additional 19 projects have received priority processing.

In the interim, the California state legislature adopted the first-in-the-nation green building code, the California Green Building Standards Code known as CALGreen. (Click here for more on CALGreen) All municipalities are required to comply with CALGreen as of January 1st of this year. In addition to the compulsory baseline requirements, CALGreen establishes more stringent “Tier 1” and “Tier 2” discretionary green measures. Under the legislation, local agencies can opt to enact their own version of CALGreen to incorporate the more rigorous “Tier 1” and/or “Tier 2” measures as mandatory.
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Last week, the Ninth Circuit ruled that the federal Tract HomesClean Air Act does not preempt the San Joaquin Valley Air Pollution Control District (Air District) from requiring certain developers to either reduce their polluting emissions from their construction activities or pay a fee. The case (National Association of Home Builders v. San Joaquin Valley Unified Air Pollution Control District, et al.) arose from a challenge by the National Association of Home Builders (NAHB) to the Air District’s Rule 9510.

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Empire State BuildingSavvy building owners and operators recognize the commercial rental market’s growing awareness of energy efficiency and sustainability issues. Driven by state and local government mandates and a desire for healthier working environments, builders and architects are constructing new green buildings nationwide. However, for every new green building constructed, there are thousands of existing commercial buildings that remain energy inefficient–consuming water, electricity and gas in excess and spending a premium in bloated operating expenses. Renovating these relics of bygone days of carefree consumption to incorporate green concepts is a burgeoning industry. Even the Empire State Building in New York is undergoing a $20 Million green retrofit that is expected to save over $4.4 Million in annual energy costs and reduce the building’s overall energy consumption by close to 40%. Because investing the initial capital in a green retrofit can be expensive, especially for building owners in a down economy, many have turned to traditional lenders for financing. The majority of established lenders, however, have not yet developed a consistent approach for underwriting a green retrofit. In trying to secure financing for your green retrofit, how do you make your lender see the greenbacks in greening your building?
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California Green BuildingCalifornia’s first-in-the-nation set of mandatory green building standards for new construction is slated to take effect on January 1, 2011. Referred to officially as the California Green Building Standards Code, CALGreen applies to all new public and privately-constructed commercial and residential buildings. Integrated within the state’s Building Standards Code, it includes a matrix of mandatory requirements as well as two sets of voluntary measures tailored to residential and non-residential building classifications.

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LA Office BuildingAs the economics of green buildings continues to align with the social and political pressures of climate change, many national and regional businesses are “greening” their form leases by including provisions that address everything from the installation of energy efficient lighting to the use of toilet paper that incorporates minimum percentages of recycled product. Whether it is a cost-saving measure or just good public relations, the greening of commercial leases has been viewed generally as a step in the right direction. Nevertheless, every landlord should pay more attention to the “green” language in its prospective tenant’s form lease because, like with so many other provisions, the terms are likely still skewed in the tenant’s favor.
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Green Commercial Building

Deadline Approaches for Disclosure of Energy Efficiency Rating of Commercial Buildings

One of the ongoing challenges in making the case for “green building” has been to monetize the value of high-efficiency features, such as reduced energy consumption. In a “light-bulb” moment, the California Legislature enacted Assembly Bill 1103 (“AB 1103”) in its 2007 legislative session as a means to assure that a building’s energy efficiency is a factor in certain sale, lease and loan transactions. Specifically, AB 1103 requires disclosure of energy-usage data of commercial buildings utilizing the U.S. Environmental Protection Agency’s Energy Star Portfolio Manager program (“EPA Portfolio Manager”). The thinking behind this new “statistic” is to quantify the benefits of energy-efficiency upgrades by providing a standardized metric for energy performance in the marketplace. With implementing regulations in process, the question is what will be required of building owners as the deadline for compliance approaches?

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The Urban Land Institute (ULI), a nationally recognized organization which encourages sustainable development practices, has favorably reviewed SB 375 in its June 2010 report, “SB 375, Impact Analysis Report.” Adopted in 2008 by the California Legislature, SB 375 for the first time links land use decisions to funding of transportation infrastructure.
Urban Sprawl
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A story from the New York Times, published March 3rd underscores what we have been saying for over a year: green leases — or commercial leases that draw on the benefits of sustainability — are attracting the attention of both tenants and investors.

Green LeasesThe story, “Seeing the Investor Value in Being Green,” reports that a German real estate investment company, Jamestown Properties, has proclaimed that it will go “green” in its entire $4 billion portfolio of buildings here in the U.S. According to the New York Times, Jamestown will overhaul its existing properties by installing low-flow water fixtures and better lighting, by revamping heating, ventilation and air conditioning systems, and even by adding bike-share stations to some of its buildings. Jamestown expects to spend between $3 million and $10 million to retrofit its properties, the Times reported. (Click here to read the article.)
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Despite a troubled economy, developers are exploring the opportunity for new Leadership in Energy and Environmental Design (LEED) certified energy efficient buildings. Likewise, many tenants are also bent on reducing their carbon footprints and meeting emerging corporate sustainability requirements demanded by their customers and encouraged by their employees. As a result, many tenants today desire to be in buildings that truly manage their energy, water and resource consumption. The bottom line is this: Building “green” requirements into commercial leases can result in growing dollars in your pocket.

But what are “green” leases? Under one definition, green leases encourage sustainability in the construction, renovation and operation of commercial buildings. Sustainability is best viewed as a journey — a process of continued improvement to achieve higher efficiencies in water and energy usage, as well as recycled materials, waste minimization, healthier indoor air, and ever more efficient transportation options for the tenant’s employees and customers.
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The California Climate Action Registry recently recognized Greenberg Glusker for the firm’s extensive commitment to climate change and sustainability. That commitment was on display in the office remodel making it a true green office.

The key elements included recycling and reusing materials from the old design and incorporating them into the remodel of the firm’s new interior spaces. From the metal screws to wood panels to light fixtures, nearly 95 percent of the materials were recycled and reused.

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