Sustainable industrial buildings given the Green Light
by James Mascaro, Dermody Properties

MID Atlantic Real Estate Journal - New Jersey - June 13 - 26, 2008
MAREjournal.com

The year 2007 was a "Green Light" year for DP Partners and many other developers. It was the year sustainability was given serious, in-­depth consideration. For us, it was the year we joined the U.S. Green Building Council (USGBC); the year we analyzed the Leadership in Energy and En­vironmental Design (LEED) construction rating system as it applies to industrial facilities; and the year we in­stituted our pioneering effort, inspired by LEED standards, to conserve energy and the en­vironment. That was also the year we committed to building green and educating ourselves and our clients on the inher­ent benefits of green. For me, it was the year I became the first (with many more in the pipeline) in our company to earn the LEED-Accredited Professional (LEED-AP) cre­dential.

The LEED-AP credentialing program was launched in 2001 by the USGBC, which was founded in 2000. In early 2008, an independent organization, called the Green Building Certification Institute, was in­corporated to allow for the ob­jective, balanced management of the program. The LEED-­AP program was designed to identify those individuals with a thorough knowledge and understanding of green build­ing techniques, practices and standards, necessary for the successful implementation of the LEED Green Building Rating System. In order to earn the credential, designees must pass a rigorous two-hour, proctored, computer-based test and must score at least 170 out of a possible 200 to pass. To date 45,162 professionals have earned the LEED-AP designation.

DP Partners has embraced many of the council's criteria for sustainability and added sustainability specifications more specifically applicable to the type of industrial proj­ects and parks we develop. Over the last 12 months, we have applied some level of our green-development criteria to seven new buildings under construction totaling nearly 3,000,000 s/f. We believe these numbers will only increase as we present our sustainability program to our clients. We are working toward LEED Silver Certification of our first New Jersey building in 2008 and, by June 1, will complete the construction of the first entire LEED-registered industrial park in Georgia to meet LEED Silver Certification criteria.

Until green development is common practice or mandated, it is still a juggling act. On one hand, we want to be environ­mentally responsible and em­ploy cutting-edge development practices. On the other hand, we want our green speculative buildings to remain competi­tively priced.

As an industry, we are mak­ing progress that -- within the context of construction's historically glacial movement -- is remarkably fast. The LEED New Construction rat­ing system was first released in 2000, and the LEED Core & Shell rating for speculative development became available in July of 2006. According to SmartMarket Trends Report 2008, published by McGraw ­Hill Construction Analytics, the value of green building construction starts for 2008 will exceed $12 billion and is projected to increase to $60 billion by 2010, at which time approximately 10 percent of all commercial construc­tion starts is projected to be green.

At the fulcrum of this di­lemma is the corporate user, who is also balancing cost and good citizenship. But corpo­rate boardrooms are coming around. By 2009, 80% of Cor­porate America is expected to be engaged in green at least 16% of the time and the other 20% will be engaged in green 60% of the time, according to the Greening of Corporate America SmartMarket Report 2007, published by McGraw Hill Construction.

Corporations tend to take a long view of new facilities that they will occupy over the long term. An upfront investment of an additional one to two per­cent of the total construction cost, on the average, results in a life-cycle savings of 20% of the total construction costs within a one- to two-year pe­riod or 10 times more than the initial investment, according to The Costs and Financial Benefits of Green Building: A Report to California's Sustain­able Building Task Force. For example, a $4 psf investment in building green nets a $58 ps/f benefit over 20 years. That includes a per-square­-foot savings of $5.80 in energy savings alone. According to the U.S. Environmental Pro­tection Agency, tenants can save about $.50 psf each year through strategies that cut energy use by 30 percent, representing a savings of $50,000 or more over a five-year lease on a 20,000 s/f building.

The LEED rating system encourages and accelerates global adoption of sustainable green building and develop­ment practices through the creation and implementation of universally understood and accepted tools and perfor­mance criteria. LEED is a na­tionally accepted benchmark for the design, construction and operation of high-perfor­mance green buildings. LEED recognizes performance in five key areas of human and en­vironmental health: sustain­able site development, water savings, energy efficiency, materials selection, and indoor environmental quality.

The corporate clients we deal with all over the country are very much aware of the U.S. Green Building Council's certification program and want to work with LEED-AP designees. They are also very much on board with the LEED Green Building Rat­ing System and the potential operational savings of up to 20% of construction cost over the life cycle of a sustainable building.

Based on input from our corporate clients, Building K, a speculative 365,760 s/f cross­-docked distribution center at the 1,100-acre, rail-served LogistiCenter at Logan in Swedesboro, NJ, within Logan Township and Gloucester County, has been designed and is being constructed within the guidelines of LEED standards. In January, the building was registered for LEED for Core and Shell pre-certification.

Scheduled for completion this summer, it will accommodate single or multiple users and features a 32' clear-height ceiling, 60' by 60' bays, 96 truck-dock positions, four drive-in doors, ES/fR fire-sup­pression system, and parking for 88 trailers and 235 cars. Those specifications meet the physical requirements of our target clients, and our sustain­able-development program improves our environment by applying state-of-the-art design and construction best practices. We have established the following four goals:

• Design Green - Promote and utilize environmentally friendly materials and energy-­efficient systems in new and retrofitted buildings

• Build Green - Reduce con­struction waste, promote recy­cling during construction, and utilize green design criteria

• Work Green - Create worker-friendly environments that increase employee productivity

• Save Green - Through the judicious selection of building materials and systems, such as energy-efficient lighting, reduce operational costs for our clients. We have identified the fol­lowing specific areas to be considered and applied to all qualifying projects including:

• Conscientious Site De­sign -- Reduce the impact on developable land, preserve and enhance the natural fea­tures of land, support energy conservation, and prevent adverse impacts to adjoining properties.

• Water Efficiency -- Utilize plumbing fixtures and ap­ply landscaping design that conserve and reduce water usage.

• Energy Efficiency --Utilize energy-modeling simulations and identify cost-efficient ways to improve energy ef­ficiencies.

• Materials & Resources -­Utilize recycled content, man­date recycling of construction waste, and reduce energy and transportation costs through the use of local sources of con­struction materials

• Indoor Environmental Quality -- Utilizes natural lighting, temperature-control systems and improved indoor-air quality to promote em­ployee well-being and increase productivity

The greening of the construc­tion industry is responsible for generating a lot of enthusi­asm and creativity within the ranks of its practitioners. The trend is moving so fast that DP has mandated that the architectural, engineering or contracting firms it retains for all projects to be developed to LEED standards must have a LEED-AP certified person on staff. The federal General Services Administration (the country's largest commercial tenant) and 24 states now mandate certified green-only construction for all new gov­ernment buildings in addition to the 75 cities, 23 countries, 10 school districts and 36 col­lege systems with green initia­tives or incentives.

Will all of these greening initiatives reduce the rate of global warming? Buildings are one of the heaviest consumers of national resources and ac­count for a significant portion of greenhouse-gas emissions that affect climate change. In the U.S., buildings account for 38 percent of all CO2 emissions, according to EIA Annual Energy Review 2005, published by the U.S. Energy Information Administration of the U.S. Department of En­ergy. Buildings represent 65 percent of all U.S. electricity consumption, use 40 percent of all U.S. primary energy, and consume 12 percent of the nation's potable water and 30 percent of the country's raw materials, according to US­GBC. The council also states that building green saves 20 to 50 percent of energy, 70 percent of construction waste, and 40 percent of drinkable water.

Considering the magnitude of the construction industry's impact on the global environ­ment, anything we do to build eco-friendly sustainability will make a significant and positive difference in the measurable terms of health, productivity, decreased operational costs, and a reduced carbon foot­print. We all realize that our natural resources are finite, so let's protect the planet, give our tenants something to feel good about, and take advan­tage of cost savings that drop to the bottom line. The future is now, and it is green.

James Mascaro, LEED-AP, is development manager- Eastern Region for Reno, NV-based DP Partners