1. SUSTAINABILITY AND REAL ESTATE MANAGEMENT 1

2. In This Chapter > Owner’s goals and expectations > Key drivers toward sustainable real estate management > Sustainability and different property types 1-1

3. The Owner’s Goals and Expectations 1-2

4. Sensible and Sustainable 1-3 > Can be good, profitable management > Objectivity is important > Do not make assumptions about higher value based on general “greenness” > Use data on specific cost savings to make case

5. Tenant and Resident Demand > Employee absenteeism and recruiting > Marketing impact for residential properties > CAM charges > Green-ready 1-4

6. 1-5 Rising Resident Demand

7. Impediments to Sustainability 1-6 > Pass-through charges in commercial > Owner-paid utilities in residential

8. 1-7 Resistance Is Common > Myths about sustainable real estate –Sustainability is a fad –Costs are exaggerated –Old buildings cannot be sustainable > Other real estate practitioners who lack knowledge of sustainability  Brokers  Lenders  Contractors

9. 1-8 The Bottom Line > Increased demand > Lower operating expenses

10. 1-9 > Double-glazed windows > Electrical chiller with VFD > Variable volume exhaust > Internal shades > CFLs and fluorescents > HVAC microprocessor > 10 percent energy reduction Case Study: Reduced Operating Expenses—Multifamily Source: Greg Martin, CPM®, Draper & Kramer, Incorporated; photo: dominicphoto.com

11. 1-10 Case Study: Reduced Operating Expenses—Commercial > Major renovation > LEED and Green Globes > Total payback less than 8 years > 14 percent ROI > $78,000 annual cost savings Source: Rocky Mountain Institute, Built Environment Team http://bet.rmi.org

12. 1-11 Payback Period and Cost-Benefit Analyses > Cost of Upgrade ÷ Annual Savings = Payback Period > Cost-benefit analysis  Quantitative factors  Qualitative factors

13. The Triple Bottom Line 1-12 > People, planet, and prosperity > Tailor discussion to priority of owner, tenant, or resident

14. Regulations 1-13 > Understand relevant regulations > Track what’s on the horizon > Keep property in compliance—a risk management issue > Share information with regulators and policymakers if desired –Through professional associations

15. Incentives 1-14 > Federal and state tax credits > Rebates from utilities > Grants for equipment, commissioning, consulting > www.dsireusa.org > City and state Web sites > Utility representative

16. Voluntary Programs and Standards 1-15 > USGBC LEED > ENERGY STAR > Green Globes > ANSI National Green Building Standard™ (multifamily) > ANSI/ASHRAE/IESNA Standard 90.1 > ANSI/ASHRAE Standard 90.2 > 2030 Challenge—Architecture 2030 > BOMA International 7-Point Challenge

17. 1-16 > Some solutions apply to all property types; some are type-specific –Solutions must apply to your specific property > Office > Multifamily > Retail > Industrial Sustainability and Different Property Types

18. 1-17 Exercise > Multifamily scenario - What information would you seek and what analysis would you perform? - What would you recommend? > Office scenario - What information would you gather for first meeting? - What will you do to alleviate concerns?