“Green,” or environmental sustainability, has been part of real estate vernacular for over a decade, yet
commercial property markets are still a long way from achieving sustainability as a prevalent trend line.
Presently, good intentions exist. There are a number of successful Green developments taking place
as large corporations look to become “Green Conscious” and environmentally considerate. In commercial real estate, however, roadblocks abound—from millions of square feet of legacy buildings to the
lingering hangover from the Great Recession, where caution means opting for lower rental rates versus
tenanting a more expensive Green building.
Paul Waters, SIOR, CCIM, CRE, FRICS, an executive vice president with NAI Global in New
York, sums up the cross-currents as a kind of balancing act. To the positive, he lists the fact that tenants
generally rate Green buildings superior to non-Green buildings, and big, international companies are
requesting Green spaces to please shareholders, analysts, and Wall Street.
On the other side of the ledger, he mentions off two inhibitors. First, most assets are dated, and
making improvements on an older building might not be cost effective. Second, small entrepreneurial
companies focus mostly on cost of space.