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{Funnelist Market Watch} The Greening of the Lease to a Healthier Tomorrow

05/15/2014
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“Green leases” – or better yet, "green clauses” – that address a healthier and more sustainable operation of a building and its occupants, are here for the long run.  We spend 90% of our time indoors and occupiers of commercial buildings use 50% of the power – it’s time to raise the bar.  Since we can control this interior environment for the most part, why not put some time and effort up front to ensure that we consider our health and the greater good when we lease space?  The office market here in San Francisco has really embraced this new operating paradigm, with over 50% of the existing class-A stock LEED certified and 100% of the new product coming out of the ground seeking LEED certification.

As companies increase their commitment to sustainable practices and goals, a green work environment becomes part of their brand and a benefit to recruiting and retaining talent.   It is notable that CoStar, the largest commercial property database, lists on its app “Energy Star/LEED” certification as one of the first two filter buttons. 

The “green lease" is now our operating reality going forward.  We just need to tweak language already in place to reflect the demands for a healthier and more sustainable workplace.  How do we get to a “greener” lease?  It’s really all there fundamentally.  We are just bringing a higher level of attention to what comes into our buildings and what comes out of them.

We see an increased focus on products that use less chemicals in their manufacturing and have a sustainable life cycle to them.  Building a base building to a LEED standard and then filling it with FF&E that have harmful chemicals just does not make sense.

We also see leases going to “net of electrical” vs. fully serviced.  This will be a big change to our market, but one that brings awareness and conservation.  Building systems of the future will allow for occupiers to have real-time monitoring and sensors in place to power down lights, plug loads and support equipment.

The next wave we will see in sustainability will be a much deeper dive into indoor air quality, access to healthy food, and proximity to amenities and areas that encourage fitness and mental health.  Stay tuned as "wellness score" becomes the next buzzword that pushes the boundaries of green as we understand it today.

Here's to the open discussion of greening of our future.

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By: Meade Boutwell

LEED® AP O&M | Senior Vice President, CBRE

Meade Boutwell, LEED AP O&M, is a senior vice president for CBRE and a 29-year veteran in the industry. During the course of his career, Mr. Boutwell has sold, leased or subleased more than 9 million feet of commercial space in San Francisco. 

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Follow Meade on Twitter: @MeadeSF

Follow CBRE on Twitter: @CBRE

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