Feb. 27, 2017 "The economic case for retrofitting buildings": Today I found this article by Toon Dressen in the Globe and Mail. This is a good and positive article about the environment. However, there were some funny and negative comments below it:
Beyond social responsibility, more and more data are proving it makes economic sense for landlords to retrofit their buildings and make them sustainable and energy efficient.
Just as today’s consumers are willing to pay a little more for organic food, tenants will pay more and stay longer in green buildings.
A study of Bentall Kennedy’s North American real estate portfolio of more than 300 buildings found that environmentally friendly office properties net 3.7 per cent higher rents. In their Canadian holdings, occupancy rates in environmentally certified buildings were 18.7 per cent higher than non-certified.
The study, conducted by University of Guelph professor Avis Devine and co-author Nils Kok of Maastricht University in The Netherlands, calls tenants in green buildings “stickier” and “happier.” Tenants stay put in their space, she says, and reduce landlord leasing costs associated with turnover.
Plus, as governments move to increase the costs of carbon, which have now been benchmarked at $50 per tonne by 2022, there will be a strong incentive for building owners to reduce operational costs related to emissions and energy use.
BDC – the Business Development Bank of Canada, the crown agency that supports 42,000 small and mid-sized companies – says green retrofit “improvements usually pay for themselves within two to six years.” Deep retrofits will take longer to pay off, but they will pay off in the long term.
Couple these economic benefits with the U.N.’s Marrakech Climate Change Conference last November, and it’s clear the wheels are in motion to reduce emissions.
When it comes to the international climate change accord, our governments need to figure out how to move from words to actions to meet the 2030 net zero goal for homes and buildings. The longer landlords wait, the more punitive the price in both losing tenants and higher energy costs.
When we talk about climate change, it’s easy to point to obvious “sinners” – cars and smoke stacks. But commercial and residential buildings account for 17 per cent of the greenhouse gas emissions in Ontario.
We bought the buildings, but did it on the cheap, pushing back the real energy efficiency costs to someone else: our future selves. Now is the time to get serious: zero per cent of the cars on the road today will be on the road in 2050, but 70 per cent of today’s buildings will still be in use because we can’t rebuild cities overnight. We have to retrofit existing buildings.
Here’s the good news: in the building industry, unlike others, we have the know-how and technology to be a key player in meeting a steep challenge. Building efficiency isn’t just low hanging fruit, it’s the fruit that’s ripened and ready to fall into our lap.
Changing lightbulbs to LED and lowering the furnace a degree at night are important, but largely symbolic: renovation and retrofit are the real game-changers.
First and foremost, focus on insulation and draft sealing. Then consider high-efficiency HVAC equipment, rainwater management systems, improved window glazing, insulated piping and more efficient appliances to reduce demand for energy. Engineers and architects can help you find the greatest gains.
Talk is cheap. In March 2014, the governing council of the Ontario Association of Architects (OAA) approved the retrofit of our headquarters in Toronto, which was originally built in 1992. Our analysis shows that the additional costs of selecting a net zero retrofit is $1.8-million and will allow the building to become carbon neutral by 2018, 12 years before the 2030 deadline. We will reduce our energy use by 90 per cent and install solar panels to generate clean power on site, the combination of which will generate savings of more than $85,000 a year.
Before accounting for future carbon taxes, this renovation will pay for itself in about 20 years (and that number will drop as the cost of energy rises). The next generation of architects will be left with a building that has low operating costs, helping them in future financial planning.
To ensure retrofits deliver savings, building owners need: current baseline data on the energy and water use; recommendations for the proper equipment to reduce water and energy use; professional estimates of projected energy reductions and cost savings; and a monitoring program to collect data on the building’s energy and water use after the retrofit.
It’s also a good idea to research federal and provincial incentive programs, such as supporting loans for deep retrofits. Ontario’s green bank is a good example of how government can support the retrofitting of our building stock.
There is now compelling evidence that buildings with sustainable certification outperform similar non-green buildings in terms of rental rates, occupancy levels, tenant satisfaction scores, and the probability of lease renewals.
Retrofitting each building will have a positive effect on your tenants but also help to change the world.
Toon Dreessen is immediate past President of the Ontario Association of Architects (OAA).
Comments:
Ken__W
1 day ago
The author left out the fact that retrofitted buildings are typically in the highly sought after and high rent areas. Which accounts for high occupancy, longer tenancy and higher rents.
The retrofits themselves are not attracting and keeping tenants, its the location, location, location!
3 Reactions
seth
22 hours ago
Actually the cost of the energy retrofits is about 20 cents a kwh, while the cost of new nuclear at Darlington is in the 3 cents a kwh range.
Unfortunately, the current bunch of science illiterate halfwits at Queen's Park, with their law degrees and English diplomas, have overruled the province's engineers, and built a lovely infrastructure of lucrative Big Oil gas contracts backing up a worthless wind/solar infrastructure and associated up to 10 times sized transmission builds.
In the faint hope a thinking Conservative government replaces the dimwits in 2018, all those lucrative energy contracts could be cancelled and power rates cut in half.
Makes the retrofit decision a bit dicey.
Google "lawrence-solomon-if-voters-want-to-rip-up-ontarios-outrageous-renewable-energy-contracts-the-courts-wont-stop-them"
1 Reaction
gafoulds
1 day ago
There are studies that control for location. I.e. studies that compare deep retrofitted and cosmetic touch up properties in the same neighborhood. Deep retrofit properties win hands down. Owners charge higher rents and enjoy higher occupancy rates. Plus, tenants report that employees book fewer sick days, and are off for less time.
1 Reaction
wysiwyg
15 hours ago
"Just as today’s consumers are willing to pay a little more for organic food, tenants will pay more and stay longer in green buildings."
HAH! Only if they have no choice.
1 Reaction
sea monkey
11 hours ago
Article sez it is about economics and yet doesn't bother with a detailed cost / benefit analysis but instead serves up a cold serving of green washing gruel.
The Ladder: Allana Williams: Today I found this in the Globe and Mail:
Allana Williams, 48, is energy manager and environmental coordinator at Whistler Blackcomb and founder of the resort’s Foundation Environmental Fund, and designs, implements and tracks sustainability programs.
I am from Kitchener, Ont., and came out to Banff when I was 18 – my first time on an airplane. Took a bus up here to Whistler, and fell in love with it.
I went to Wilfred Laurier University for business and took a psyche course with professor Doug Mackenzie-Mohr called ‘Peace, Conflict and Aggression.’ At first, you came out thinking, ‘It is hopeless.’ Then he started talking about what we’re going to do about it. That changed everything for me.
I wanted to do something in business, to be involved in the environment, and to be somewhere I loved to be. So I went to the University of Waterloo for environmental-resource studies and kept the business option at Laurier.
For my third-year thesis, to do a waste-audit review, I would come here on holidays. I switched to UBC for my final year, then sold silk-screen T-shirts, worked as a landscaper and a lift assistant, and did the environmental work on days off.
In 1997, Whistler and Blackcomb came together. I said, ‘I will save you enough money on garbage collection to justify the position.’ At the time, we were the only municipality to pay by volume so the first thing I did was to buy compactors. That saved our truck traffic by 70 per cent.
One of the VPs has a story about me coming to them and saying, ‘Hi, I am Allana and I need $250,000.’ And they are like, ‘Sorry, who are you?’ I was so young, and a woman, meeting all these [waste-management] guys. I remember being in a meeting and saying, ‘You have to talk to me, because I have the money.’
At the time, it was business versus environment. The key, initially, was to prove the business case, which gave me the cred to stay. We did it with waste – reduced the bill by almost half, then put in the recycling program. They asked how the program is going. I said, ‘Good … really good.’ That’s when I learned to measure everything.
I don’t have to go into a meeting and talk about climate change now. We’re been through the era of why, and now we’re long into the how. There are amazing, brilliant people here who figure out things that haven’t been done before.
Whistler is a forward-looking community – very green, and you work with people who love to be outside. The solutions team – they’re skiers and mountain bikers, raising their kids here. We have a lot of things going for us in terms of people being on board.
Some people think we’re a bunch of ski bums. I mean, I love the mountains, and like that we can come to work in blue jeans. But the people have kept me here for 20 years. The culture is all about striving to be the best, always willing to help each other out.
We like to try new technologies. We like to take a problem and attack it. The culture of the organization is just ‘go’ and now they are going toward the sustainability agenda. I don’t ever feel not motivated. I am surrounded every day by people who are so keen.
Most of [the job] is energy management – to reduce what we consume, be it electrical, natural gas or [other] fuel. We are looking at clean tech as well but demand-side management is less expensive. It makes sense to start there. So we started putting in solar panels, and optimizing what we have.
You have to find the common ground. If I am doing a lighting project, I want to save energy and make your space look beautiful. I took a lighting design [course], so I am not just considering the wattage, but also what it looks like. If it’s beautiful and we’re saving energy, everybody is happy.
I have a hard time letting people do things for me. You can’t grow a program indefinitely. You have to get help at some point. I’ve gotten better at [delegating], and the results are awesome.
Less energy is less work, and less work is less maintenance. It’s all about alignment.