Southern California Office Real Estate Blog

GREEN LEASING TOOL KIT

By Jodi Summers

Studies and Awards are praising green commercial buildings for creating higher occupancy rates, stronger rents and higher sales prices. As we’re in a down market for leasing, those in the know want to share, so the California Sustainability Alliance has developed and test strategies to green California’s commercial office space. This effort focuses on “green leasing”, i.e., integrating sustainability practices into the entire commercial leasing process. The Green Leasing Toolkit 2.0 includes insight on service provider selection; marketing of buildings, development of green specifications; request for proposal (RFP) and letter of intent (LOI) drafting; site selection and due diligence; and the negotiation and drafting of realistic and enforceable lease language.

The tools offered in Green Leasing Toolkit 2.0 are relatively easy to implement. These tools can be used by both landlords and tenants who manage or occupy large portfolios of facilities as well as small business owners and landlords who hope to green an individual building.

The Toolkit supports tenants and landlords in the following ways:

* Educating their organizations

* Developing their own green leasing policies and requirements

* Communicating policies and requirements to the market

* Measuring and comparing the green attributes of different buildings

* Developing specific lease language

http://sustainca.org/green_leases_toolkit

http://www.socalgreenrealestateblog.com/?p=52

GREEN COMMERCIAL REAL ESTATE WEBSITES

GREEN COMMERCIAL REAL ESTATE WEBSITES

Building Owners and Managers Association - www.boma.org - provides goals with its 7 point challenge, plus links to resource sites.

California Sustainability Alliance - www.sustainca.org ­- offers a toolkit to help tenants evaluate the greenness of buildings.

The Environmental Protection Agency’s Energy Star Program - www.energystar.gov- offers an energy assessment matrix and online portfolio manager software to help assess energy and water consumption in a building.

Institute of Real Estate Management - www.irem.org - publishes A Practical Guide to Energy Management, a primer on buying and

saving energy.

National Association of REALTORS® - www.realtor.org - offers an online “Field Guide to Commercial Green Buildings,” through its

Information Central.

U.S. Green Buildings Council - www.usgbc.org - provides an operating and maintenance rating system and checklist for existing Buildings to benchmark building performance–a first step toward achieving a

Leadership in Energy and Environmental Design (LEED) certification

Wind Power - www.windustry.com - This web site provides an overview of the basics of land specifics that are needed to produce wind energy.

Manufactured Housing - www.manufacturedhousing.org/default.asp -

Low cost housing developments; investing, green buildings

Info courtesy of http://www.realtor.org/NCommSrc.nsf/files/RCA_Report_summer2008.pdf/$FILE/RCA_Report_summer2008.pdf

CALGREEN – > CALIFORNIA NOW HAS THE COUNTRY’S GREENEST BUILDING STANDARD

By Jodi Summers

Bravo to us! California has adopted the greenest building standards in the United States…and the world.

The new code, called Calgreen, goes into effect next January 2011. It requires all builders to:

v Install plumbing that cuts indoor water use.

Mary Nichols, chairwoman of the California Air Resources Board, said the new building code would require developers to slash water use in their buildings by 20%, using more efficient toilets, shower heads and faucets.

v Divert 50 percent of construction waste from landfills to recycling.

v Use low-pollutant paints, carpets and floorings

v Buildings will be given certificates of occupancy occupied only after strict energy standards were verified.

In addition, for non residential buildings:

v Install separate water meters for different uses.

v Mandates the inspection of energy systems by local officials to ensure that heaters, air conditioners and other mechanical equipment in nonresidential buildings are working efficiently.

v It allows local jurisdictions, such as Los Angeles and San Francisco, to retain their stricter existing green building standards, or adopt more stringent versions of the state code if they choose.

“California should be proud… These are simple, cost-effective green practices. …” notes Tom Sheehy, acting secretary of the state Consumer Services Agency and chair of the California Building Standards Commission, which approved the standards. “This is (something) no other state in the country has done - integrating green construction practices into the very fabric of the construction code.”

While California’s largest metropolitan areas have adopted their own green building standards, these new regulations will be particularly useful for smaller jurisdictions that have been unable to develop their own green construction guidelines.

This is a positive alternative to LEED construction standards. Sites Sandra Boyle, an executive vice president of Glenborough, a developer, “The cost for owners to go through this rating system is astronomical — in a very challenging commercial real estate market.”

“You will have a whole bunch of cities that never would have included this in their building doing it, and doing it in a way that won’t kill the economy,” observes Matthew Hargrove, a vice president with the California Business Properties Association. “Outside the coastal areas it will be helpful - like in West Sacramento, where they looked into creating a green building code but balked because it’s cumbersome to develop and they didn’t have the resources.”

Buildings currently account for about one-quarter of the state’s total greenhouse gas emissions. These new standards are applauded as an important step in helping California meet its goal in reducing the state’s greenhouse gas emissions by 30 percent by 2020.

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http://www.sfgate.com/cgi-bin/article.cgi?file=/c/a/2010/01/13/MNDR1BH9SA.DTL#ixzz0dJ9grkaW

http://www.sfgate.com/cgi-bin/article.cgi?file=/c/a/2010/01/13/MNDR1BH9SA.DTL

http://www.latimes.com/business/la-fi-green-building11-2010jan11,0,1841989.story

http://www.thedailygreen.com/cm/thedailygreen/images/WA/Kohler-DualFlush-BR08-lg.jpg

YALE PICKS THE TEN MOST ENVIRONMENTALLY FRIENDLY COUNTRIES

Edited by Jodi Summers

Every year, Yale University releases an Environmental Performance Index (EPI), calculating national environmental factors such as a country’s environmental health, air pollution, water resources and productive natural resources. So let us present to you the most recent top 10 winning countries who can boast the title of the most eco-friendly nations in the world.

1 - Switzerland

Switzerland’s hard-line legislation on pollution makes it one of the world’s most eco-friendly nations. Switzerland’s strategy is to continue to foster cooperation between organizations and individuals. To make sure everyone is acutely aware of how precious the environment can be, Switzerland charges for their water and waste management services as well as establishing severe environmental taxes. Prevention is the third key tenet, shown by the 2006 development of the Federal Office for the Environment (FOEN), to sustain natural resources and develop safety measures for natural hazards.

2 - Norway

Overcast Norway is the home of the world’s largest solar production plant, owned by REC Group. Norway has also taken emissions seriously, and is now planning on becoming carbon neutral by 2030, not 2050 as originally expected. The change in anticipated timing has been reduced because of what Norway has learned by funding green projects abroad and reducing at-home driving and flying.

3 - Sweden

Sweden’s mandate for a country free of fossil fuels by 2020 puts it as the third most eco-friendly country on the planet. Already, a majority of Sweden’s power is either nuclear or hydroelectric. Solutions for automobile and flight transport include ethanol and animal waste conversion. Additionally, Sweden is one of the world leaders working on harnessing the power of waves. At the University of Uppsala, Sweden is developing “wave power” which converts waves into 4x as much energy as solar power in the same amount of time, with no waste and no emissions.

4 - Finland

Finland is experiencing a remarkable recovery from industrialization, using initiatives to clean up water and air quality in industrial areas, and practicing land preservation. Bravo as Finland has managed to reverse deforestation. The country’s forests are now growing at a greater rate than they are being deforested, showing an environmental gain even with the annual timber harvest. Finland can also be attributed with starting the United Nation’s Environmental Program (UNEP) Task Force for Sustainable Building and Construction, which looks not only at the sustainability of the building, but of the resources and process used to construct it.

5 - Costa Rica

With 5% of the world’s biodiversity contained in one country, Costa Rica has always been on the forefront of environmental conservation. Did you know that a full quarter of the nation is devoted to park preservation? That helps the country score high on the EPI list. Couple their conservation efforts with the fact that Costa Rica uses hydroelectric power in 80% of the country, and add on their 5% gas tax which funds environmental programs, and Costa Rica comes in fifth.

6 - Austria

It’s very impressive that Austria’s environmental conservation measures are enforced by all levels of government, from federal to municipal authorities. For example, waste disposal is a highly regulated department encompassing everything from individual waste to corporate chemical, air and agricultural pesticide pollution. Water quality and forest preservation, are extremely high on Austria’s list of priorities, thus the quality level for Austria’s lakes and rivers is among the highest in the world. The development of Austria’s National Protective Forest Plan has also helped in keeping the nation’s natural beauty pristine.

7 - New Zealand

New Zealand‘s relatively small population in relation to land mass has helped preserve this nation’s natural resources. While automotive emissions and industrial pollutants are still problematic, New Zealand is working hard to develop restrictive legislation and alternative energy sources. The nation was host to the 2008 World Environment Day, and has developed the Environmental Risk Management Authority, which regulates the introduction of non-native species and environmental components so as not to threaten New Zealand’s pristine atmosphere.

8 - Latvia

The Baltics weigh in. By monitoring and reducing water pollution, Latvia’s salmon crop and freshwater bodies are all in the range of “good.” Taken steps toward improvement, Lativia has begun dismantling pollutive farms to reduce fertilizer and insecticide chemicals and allow room for the return of natural forests. Since obtaining freedom from the Soviet Union 1990, Lativa has decreased stationary pollution by 46% and wastewater by 44%, devoting a major portion of environmental funds to water treatment and energy conservation techniques.

9 - Colombia

Beating Costa Rica, Colombia is home to 10% of the world’s species, giving the country a wealth of ecological diversity. While Colombia has had problems in the past concerning deforestation, the detrimental effects of the coca trade, and political strife involving their natural oil deposits, these factors have served to motivate Colombia towards energy conservation and new, less politically tumultuous resources. Colombia has also begun programs for the cultivation of natural parks that support the growth of native medicinal plants with preserves such as the Orito Igni-Ande Medicinal Flora Sanctuary, a 10,626 hectare preserve.

10 - France

The French government is very aware of the problem of climate change. Their strict environmental protection measures are incorporated into the national Constitution and reviewed every year with the eventual goal of 54 million tons of saved C02 by 2010. France is one of the few in the Kyoto agreement to cut such a large amount of emissions so quickly. The country’s laws are comprehensive, covering every layer of production from supplier to producer to consumer. This has helped make France the number one producer of renewable energy sources in the EU, 78% of its energy being nuclear powered, which in turn has reduced nitrogen oxide and other hazardous emissions by 70%.

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Sources:

http://epi.yale.edu/Home

http://epi.yale.edu/CountryScores

http://www.bemoreeco.com/2009/03/top-10-eco-friendly-countries/

http://www.sussex.ac.uk/International/europe/Sweden.jpg

http://greenferret.files.wordpress.com/2008/09/switzerland-mountain-lake.jpg

http://www.boxturtlebulletin.com/tag/norway

http://www.ippnw-students.org/Chapters/Finland/finland.jpg

http://www.unitedplanet.org/volunteer-in-costa-rica-long-term/images/costa-rica-ocean-view.jpg

http://www.nationalgeographic.com/adventure/0510/photos/Jpegs/NewZealand.jpg

http://www.austria-trips.com/images/Austria-Mountains.jpg

http://www.e-architect.co.uk/riga/jpgs/jurmala_latvia_hoskins_m06.jpg

http://img5.travelblog.org/Photos/61720/335583/p/f/1781.jpg

http://i40.tinypic.com/2qncqxi.jpg

http://www.bargesinfrance.com/premier-burgundy-countryside.jpg

http://farm4.static.flickr.com/3115/2352156385_c389b09b15_b.jpg

http://www.pbase.com/pj48/image/45644972/original.jpg

4 GREEN BUILDING TRENDS 4U

4 GREEN BUILDING TRENDS 4U

By Jodi Summers

Green building concepts are being embraced with as much wild abandon as kids grasping for the coolest new video game. It started pretty basic – green construction, then evolved into green renovation, and now it’s branching out in all directions. Here are 4 green building trends to watch and invest….

1 - Modular Green Homes – One of the most successful investors in history, Warren Buffett, recently expanded one of his business subsidiaries, Clayton Homes, to produces a line of green modular homes. These 750-square-foot eco homes, dubbed “i-houses,” can be purchased online for less than $75,000. It’s a good bet that if Buffet is invested in it, the area will grow. Our hero is second richest man in the United States with a net worth of $40 billion.

The i-houses are constructed as modules in a factory and then assembled in the field. I-houses are marketed as “affordable luxury in a green, energy-efficient package.”

Beyond Buffett, there are others, such as Zeta Communities and Blu Homes in the green prefabricated market. Modular home construction will be a wise choice for builders going forward because it may allow developers reduce risk, allowing the development of large sites to take place as sales come in rather than building a planned community in larger phases before the units are sold out.

2 – Energy Retrofits – California state measure AB 1103, which requires the tracking of the energy use of all nonresidential buildings for disclosure to prospective buyers and tenants, is a fine example of how critical energy retrofits will be in the future. Much of the country’s real estate is old and wastes energy…eventually these properties will need to be upgraded or replaced. Not to mention, this is a cornerstone of President Obama’s post recession job creation movement.

Energy Star, the government, and local utilities have been offering rebates for property owners on measures like energy audits, insulation and duct sealing. SBI Energy predicts that the U.S. home energy retrofit market will grow about 15 percent per year to $35 billion by 2013, up from $20.7 billion in 2007.

David Leathers, senior vice president of energy services for mechanical contractor Limbach, confides that U.S. commercial building in the U.S. five years or older can likely benefit from a retrofit with payback for most measures taken in less than five years.

3 - Smart Building Materials - Energy-efficient building materials are the frame of green building. Serious Materials recently raised a $60 million third round of venture for the manufacture of energy-saving windows and environmentally friendly substitutes for sheetrock. More good investments - high-efficiency insulation system companies, such as walls with micro-encapsulated phase change materials to stabilize the indoor temperatures in buildings. More…Electrochromic technologies can darken or lighten the tint of a window when in contact with an electrical current, thus managing the amount of sunlight that passes through…Ventilated double-skin facades (already being used in Europe), use inner and outer glass walls with a thin cavity to provide insulation in between for the exterior shell of a building.

4 - More Energy Efficient Energy Codes - The American Society of Heating, Refrigerating and Air-Conditioning Engineers (ASHRAE ) and the International Energy Conservation Code (IECC) are both developing the latest round of “model codes”— ASHRAE 90.1 and IECC — will likely require a 30 percent increase in energy efficiency.

Congress may soon mandate that all states raise their standards to the newest codes. The American Clean Energy and Security Act passed by the House this year includes a provision that would effectively create a baseline national building energy code by mandating the adoption of a standard set by the Department of Energy, who may very well call on the standards set forth by ASHRAE or IECC.

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http://earth2tech.com/2009/12/23/4-green-building-trends-to-watch-in-2010/

http://www.motherearthnews.com/Green-Homes/Green-Modular-Homes.aspx

http://en.wikipedia.org/wiki/Warren_Buffet

http://www.socalgreenrealestateblog.com/?p=841

http://www.ashrae.org/

http://www.icis.com/blogs/green-chemicals/2009/01/green-building-is-still-recess.html

http://www.newenglandmetalroof.com/construction_directory/green-building.gif

http://www.charlesandhudson.com/archives/eco-friendly-building-materials.jpg

HUD AND DOT WORKING TOGETHER FOR MORE LIVABLE CITIES

By Jodi Summers

Government statistics show that the average working American family spends nearly 60 percent of its budget on housing and transportation costs - making these two areas the largest expenses for the average household. Now the government wants to help.

The U.S. Department of Housing and Urban Development (HUD) and the U.S. Department of Transportation (DOT) are working together in hopes of helping American families gain better access to affordable housing, more transportation options, and lower transportation costs by creating affordable, sustainable communities.

Like putting in our light rail system, this is a long process. Over the next four years, every major metropolitan area in the country will do an analysis of integrated housing, transportation, and land use planning and investment.

Recently, HUD Secretary Shaun Donovan and DOT Secretary Ray LaHood presented the official vision for sustainable communities at a U.S. House of Representatives Appropriations Subcommittee on Transportation and Housing hearing titled, “Livable Communities, Transit Oriented Development, and incorporating Green Building Practices into Federal Housing and Transportation.”

“One of my highest priorities is to help promote more livable communities through sustainable surface transportation programs,” offered Secretary LaHood. “This partnership will help expand every American family’s choices for affordable housing and transportation,” said Secretary Donovan. “HUD’s central mission - ensuring that every American has access to decent, affordable housing - can be achieved only in context of the housing, transportation, and energy costs and choices that American families experience each day.”

DOT and HUD have created a high-level interagency task force to better coordinate federal transportation and housing investments and identify strategies to give American families:

• More choices for affordable housing near employment opportunities;

• More transportation options, to lower transportation costs, shorten travel times, and improve the environment; and

• Safe, livable, healthy communities.

The HUD/DOT task force has the goal of enhancing integrated regional housing, transportation, and land use planning and investment. Planning grants will be made available to metropolitan areas, and create mechanisms to ensure those plans are carried through to localities. DOT will encourage Metropolitan Planning Organizations (MPOs) to conduct this integrated planning as a part of their next long-range transportation plan update and will provide technical assistance on scenario planning, a tool for assessing future growth alternatives that better coordinate land use, and transportation planning.

http://www.hud.gov/offices/cir/test090318.cfm

http://www.inman.com/news/2009/03/19/partnership-targets-affordability-transportation

http://transit-safety.volpe.dot.gov/safety/sso/MeetingSummary/images/1-dotlogo.gif

http://t4america.org/logos/t4logo_square.jpg

SOCAL OFFICE PROPERTY SNAPSHOT – MAY 2010

By Jodi Summers

The specifics vary, but research is proving similar trends… the rate at which the office vacancy rate is growing has slowed on a year-over-year basis…but vacancy rates increased in the first quarter of this year.

A recent report by Cushman & Wakefield summarized the office vacancy scenario by stating, “In the coming years as recession gives way to recovery across the nation, vacancy rates will shift from rising to falling. But that shift is likely to be modest at first as businesses backfill existing space before increasing occupancy. Nevertheless as employment rises, space will be absorbed off the market and vacancy rates will begin to decline. Those cities that experienced moderate employment declines have the best potential for growth.”

Locally, the decline in vacancy could be impacted by concepts proposed in coalition with the California Chamber of Commerce. Known as CalChamber, their goal is the adoption of a simplified process for establishing flexible work schedules such as 4/10s and 9/80s. Senate Bill SB 1335 (Cox and Dutton) provides a process whereby the employee can simply request in writing and the employer may mutually agree to flexible schedules.

On a national level, CBRE Econometric Advisors reported that office vacancy rate increased by 30 basis points to 16.6% at the end of the first quarter. Although the increase was not as optimistic as the rise of 20 basis points in the fourth quarter of last year, the rate of increase is far better than the 70 basis points increase of a year ago. Grubb & Ellis results show that the vacancy rate rose by 50 basis points to 17.9% in the first quarter, versus an increase of 30 basis points in the fourth quarter of 2009. Cassidy Turley concludes that the national office vacancy rate increased from 16.4% in the fourth quarter of 2009 to 16.6% in the first quarter of 2010, noting that this is the highest vacancy rate since 2003.

In Los Angeles County in February, the unemployment rate was at 12.4% up from 10.9% the year prior.

The Grubb & Ellis results conclude, “The economy is in recovery mode, but it’s hard to tell by looking at the US office market.” First quarter absorption remained about even with the fourth quarter of 2009 at minus 7.3 million square feet. The reported noted that the biggest surprise of the quarter was a 1% uptick in the average asking rental rate for class A space to $31.10. The average class B rate was $23, an increase of .8 percent.

“This data series is volatile, so it is unlikely that rents have stabilized while the vacancy

rate continues to rise,” the report said. “There have been anecdotes of landlords in class A properties in primary markets pulling back on their concession packages, but this would most likely impact effective rates before asking rates. It will be interesting to see if the market can sustain this plateau next quarter.” In What Grubb & Ellis calls “a more definitive sign of recovery,” sublease space offered on the market decreased to 113 million square feet, down more than 10 million square feet over the past two quarters.

CBRE Econometric Advisors optimistically observed that some markets had vacancy declines during the first quarter. The CBRE researchers said that markets with high-tech-oriented economies and more geographically-dispersed suburban employment patterns-such as Austin, Raleigh and San Jose-made noteworthy strides. Another noteworthy city is Pittsburgh, which has outperformed throughout the recession and has a small but growing biotech and healthcare industry concentration, also declined by 70 bps and is boasting a 10.9% vacancy rate-its lowest in more than 10 years.

When viewed along with other property sectors, the first quarter was “the best quarter for commercial real estate in quite some time,” according to CBRE. The report cited “the decreasing rate of decline in commercial property fundamentals and the surprise of outright improvement in apartments, along with significant signs of life in the capital markets.”

According to Cassidy Turley, the data for the first quarter shows that demand for US office space continues to improve. It says that recent job growth figures indicate that the US economy will be consuming office space again by the second or third quarter of this year.

Cushman & Wakefield confirmed these results, concluding, “Overall national real estate markets are in better shape than one would anticipate given the sharpest decline in employment in more than 70 years. Yet the national vacancy rate is below the last peak in 2003 and far, far below the level of the early 1990s. This performance suggests that markets will emerge from this recession in better shape than in either 2003 or the 1990s.”

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https://www.cushwake.com/cwglobal/docviewer/AmericasEconomicPulseMAY2010.pdf?id=c33600033p&repositoryKey=CoreRepository&itemDesc=document&cid=c27400005p&crep=Core&cdesc=binaryPubContent&Country=GLOBAL&Language=EN&just_logged_in=1

http://www.globest.com/news/1642_1642/insider/184646-1.html

http://www.laedc.org/businessscan/index.html

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