A couple months back The Sun showed how little it knows about green buildings by asking residents how much of a "premium" the county should pay for such attributes on its new buildings. I call into question the paper's intelligence because, as I said at the time, "the future savings often outweigh the upfront premium (even accounting for the time value of money), meaning we would have actually paid a premium to be not-green."
In this month's Business Monthly, those who know about building costs weigh in. Although the story isn't up on the Monthly's website, here are a few key paragraphs.
[COPT CEO Rand Griffin] offered more numbers to contemplate: The 125,000-square-foot structure cost COPT $2.87 more per square foot to build than a regular building, "but we think that the operating costs were dropped by 50 cents per square foot," Griffin said. "That equates to a five-year cash payback, if you look at it that way."So, in five years, well short of the intended life span of pretty much every structure but tents, the up-front premium actually results in a savings, something most of us may assume to be true intuitively. Developers, however, don't rely solely on intuition when running the numbers on a project.
While stating that the premium to build green has dropped from 8% to 20% down to just 1% or 2% in a decade, [Urban Land Institute senior fellow Ed McMahon] acknowledged that a number of builders are building green but are not certified because the process is time consuming and the process itself costs money. McMahon still said the time to hop on the bandwagon is now.With several jurisdictions already mandating green technology for public and large private buildings -- including Montgomery County, whose requirements are among the strictest in the nation -- and an expressed desire from new County Executive Ken Ulman to foster a more sustainable and innovative county, it seems pretty certain that green will be a requirement in the very near future in Howard County.
"If your development firm is not building green within the next three years, your property will be losing value in the marketplace," he said, adding that green construction will be a prerequisite for any class A building.
..."One developer said to me that the biggest cost of financing their own building," McMahon said, "had been the cost of their own ignorance."
What remains to be seen, however, is how far Howard County will go. With developers catching on to green buildings, it wouldn't make much sense for us to require what the market is already doing on its own. Rather, the function of any local green building mandate should push the market -- through a balance of requirements and incentives -- towards environmental sustainability or even restoration (not coincidentally, a focus of the Howard County Tomorrow group I'm involved with).
Examples of regulations leading the market instead of following it might include requirements for green technology in residential buildings, green neighborhoods, and other practices that enhance, rather than degrade, the environment.