Friday Photo: ASU is one of Nation’s ‘Greenest’ Universities
Do you know which universities are recognized as the ‘greenest’?
Arizona State University’s School of Sustainability is featured here.
It was founded in 2007 and the photo details both wind turbines, with the photographer noting that solar panels are soon to be installed.
It also scored 99 out of 99 points, earning it a spot on Princeton Review’s “2010 Green Rating Honor Roll”, which ranks universities based upon their environmentally related policies, practices and academic offerings.
There’s a huge need in commercial real estate finance and investment for professionals well-versed in sustainability issues impacting real estate and finance.
It will be interesting to see where that talent starts to emerge.
Have a great weekend!
Photo credit: Flickr-Kevin Dooley
Citibank’s Destiny: Keep Funding Those Draw Requests
Audience question from my Eco Tuesday talk last night:
What are some of the challenges being faced by green project developers in today’s market?
Tough capital markets, along with soft economic and market fundamentals are creating adverse conditions for successful projects, green or not. And tough conditions can also make bank and borrower relations turn pretty ugly.
Check out this Wall Street Journal article, detailing a legal street-fight between Citibank and the owners of Destiny USA, a green retail development in Syracuse, NY, currently under construction (again). It lays out the worst nightmare that can happen to a development and is happening more often — when a lender stops funding construction loan draws, presumably due to some violation of the loan documents.
DestinyUSA got a judge to force Citibank to keep the draw payments coming. The judge noted that Citibank’s reasons for halting payment of loan draws were not based upon any violation of the loan documents. He also said that Citibank was probably trying to conserve capital, even though it received TARP funding. Of course, Citibank has a completely different view of the situation.
And what was on the line for green development overall?
DestinyUSA has has announced many so environmental and social initiatives for its 1,000,000 square foot development, that you can almost think of it as a test lab for retail sustainability practices.
Of course, the standard caveat for green development applies here – we’ll have to see if this all really comes into effect as announced when the project is fully opened.
Nonetheless, their potential existence within a retail project would be a great leap forward for the greening of retail, as well as show the way for new work models that improve worker well-being.
Examples:
- LEED-Platinum certification targeted.
- Tenants to be provided with LEED-CI buildout guidelines.
- “Green parking” — parking spaces reserved for hybrid vehicles.
- Policy of 95% construction waste diversion.
- Renewable energy: The project will be powered by a free-standing on-site renewable energy plant powered by municipal solid waste (MSW) generated by the facility and providing over 16 Megawatts of power.
- Workforce model: workers hired for construction will be kept on and retrained to work in the development once it is operational. This is an idea we like alot; it could be replicated by many other developers (assuming they successfully navigate their projects through the tough market environment).
Hopefully enough green developments currently under construction will avoid the problems experienced by DestinyUSA and other developers, and survive the current market in order to open successfully and move the industry forward.
Friday Photo - Green Finance Upgrades Opportunities
Property owners are very focused on getting stimulus (or any!) dollars to pay for energy efficiency retrofits and weatherization projects. And accompanying those applications are the green jobs expectations of many individuals.
This is the 23 July scene at a Los Angeles green jobs fair for energy efficiency and weatherization, in full swing, courtesy of Life.com.
Approximately $40 billion from American Recovery and Reinvestment Act funds were allocated to green collar jobs in energy efficiency, weatherization and renewable energy.
Many real estate professionals I know are not so sure how these funds will actually improve conditions in real estate finance and investment, due to the underlying weakness in market fundamentals, and the credit markets in particular. They point out that an upside down loan on an energy efficient property is still, well — upside down.
And will directing short term government funding towards retrofitting real estate improve life for those green collar job holders?
The green finance angle for energy efficiency retrofits appears to be one of ‘upgrading relative competitiveness’ for those concerned. That is, upgrading energy performance and job skills to create relatively more competitive properties and workers. A kick start as opposed to a final solution.
Nonetheless, given what we all know now about the financial meltdown and its effects on real estate, a green financial kick start on those two fronts — albeit experimental — provides at least an opportunity to improve the status quo beyond what we would otherwise be able to do.
The rest of the heavy lifting still remains on our shoulders.
Photo credit: Life.com
On the Mandatory Greening of Existing Buildings + EcoTuesday Reminder
Did you catch that hint about possible mandatory measures to require the greening of existing buildings?
In case you missed it, the Examiner put out the word that Mayor Gavin Newsom and San Francisco Supervisor Eric Mar will introduce legislation this week which, when passed, would authorize San Francisco’s own version of an energy efficiency financing district.
Called a “green loan” plan in the article, the loan fund would allow homeowners to receive loans to make environmental improvements to their properties and then pay back the money through extra property taxes.
But you have to read that overwhelmingly positive article a little slower, to absorb the hint buried in a couple of innocent sentences several paragraphs in.
The article focuses on how the upcoming energy efficiency and renewable energy financing plan builds on momentum created by San Francisco’s mandatory green building codes, and also hints at the City’s future actions on greening existing buildings:
Newsom has already pledged to tighten those rules to apply to existing buildings. This latest green idea may provide a way to finance improvements that could soon become mandatory.
Are mandatory energy efficiency requirements really a good idea?
Professionals throughout green building construction, retrofits and public policy have been wringing their hands on the topic of mandatory energy efficiency standards for existing buildings. Many green building colleagues and supporters want mandatory measures to address the problem of owners with “energy hog” buildings, who simply ignore the impact of their wasteful operations on the community.
There are also concerns about mandatory energy efficiency measures unfairly impacting smaller or much older projects, since the owners in both cases might only accomplish the most limited actions to address energy efficiency problems. Essentially, retrofitting these buildings might be too cost prohibitive for those owners.
Finally, the real estate trade associations and other professional bodies have been trying to send tough signals against any form of mandatory anything when it comes to building operations. Fighting any type of cost or administrative burden on owners at any opportunity.
Then there’s the flip side.
We also speak regularly with owners who introduce energy efficiency and green O&M to their existing buildings — only to have tenants blatantly ignore them. They express hope that, in a market with mandatory energy efficiency measures, they can more easily obtain tenant cooperation on O&M, plus they think they will look like heroes to their equity capital partners — who now struggle over how to assess and transmit some form of energy efficiency standards across behemoth national property portfolios run by thousands of local managers and JV operating partners.
The Green Journey Take?
While the retrofit cost concerns of small and very old properties are real, legislation can be crafted which addresses the potential energy efficiency limitations within their projects. They can, and should, get a fair deal.
As for the rest of the industry — we think that mandatory energy efficiency standards — with an appropriate, accessible, cost-effective financing mechanism — can provide real opportunity for competitive owners who “get it”, and need not be as problematic as some groups fear.
What do you think?
* * *
Reminder
Let’s meet next week re: Green Finance for Communities, Campuses & Power
I noticed that several Green Journey readers are already signed up for my upcoming talk at EcoTuesday, next Tuesday, 28 July.
Exciting! You’ll all finally get to meet each other!
I’m talking green finance and how it’s changing our communities, flowing through our science and innovation parks and accelerating the growth of clean energy. And most importantly, how green finance trends can help our businesses and help us to help others.
Are you coming out?
I look forward to connecting with old friends and meeting a few new ones.
Most importantly –> We never accomplish anything alone. A summer cocktail hour is a great time to thank friends and colleagues who inspire us and to encourage them to continue the excellent work they do in transforming our communities and country.
Meeting Details
Date: 28 July 2009
Time: 6:30pm
Location: The W Hotel, 181 Third Street, San Francisco
Sign up here!
Friday Quiz: Is the tough real estate market affecting solar PV installations?
You already know all the bad news from the real estate sector, but what about the solar power flowing through the real estate?
Quiz yourself (or an unsuspecting colleague…) on this factoid, reported in the latest issue of SolarToday magazine.
Question 1: Solar photovoltaic installations across the US grew 65% last year. But, which real estate sector has more installed solar PV systems?
a. Residential?
b. Or, commercial?
Question 2: Why?
(Don’t cheat)
Answer:
Nearly 19,000 homes and businesses connected to the grid in 2008. But, while residential installations grew by 34 percent, non-residential installations more than doubled.
Why?
Incentives shaped market growth.
2008 US P.V. installations grew 65 percent over 2007 to nearly 340 megawatts (!). Since 2005, the installed capacity of solar PV has more than tripled.
During 2008, the federal ITC was capped at $2,000 for residential installations, but uncapped for commercial. So the overall incentives for commercial PV systems was significantly higher than residential. The average size of a residential PV system increased 7 percent to 4,9 kilowatts (kW) while the average size of a commercial system increased by 67 percent to 114 kW.
Have a good Friday!
