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In Seattle, Real Estate Sector to 'Green' Its Buildings as Economic Fix-It

The city's real estate industry is spearheading a first-of-its-kind green building initiative to help boost property values and lure businesses

Jul 22, 2011
(Page 2 of )
Seattle

Seattle is greening its cityscape in a bid to boost its sluggish real estate market — all while cutting global warming emissions and slashing energy costs.

Industry leaders have banded together to spearhead a high-performance building initiative — the first of its kind nationwide — that sets ambitious sustainability and efficiency goals for privately owned buildings in the heart of the city.

The Seattle 2030 District aims to drive up property values, reduce vacancy rates, lower operating costs and create ongoing employment in retrofitted and newly constructed buildings downtown.

The idea is to rebrand the city as a hub for environmentally conscious businesses and residents and inspire similar urban development efforts across the country.

"Building owners and operators see it as a competitive advantage for the city," Brian Geller, the initiative's executive director, told SolveClimate News.

"Architects and engineers see it as an economic opportunity just to drive initial work. All of the stakeholders are excited about what it can do for the city as a whole," he said.

More than 40 real estate companies, property owners and city agencies in Seattle representing around 23 million square feet have agreed to participate in the district so far. A total of 81 million square feet — or nearly 1,160 buildings — will be included in the project's first phase.

The initiative, which Geller first proposed in late 2009, is set to celebrate its formal launch on Sept. 8.

Properties will follow voluntary benchmarks based on the guidelines of the 2030 Challenge for Planning, a project of the Santa Fe, N.M.-based nonprofit Architecture 2030 that urges the global building sector to dramatically scale back its greenhouse gas output and water consumption.

In the United States, commercial and multifamily buildings account for 40 percent of the nation's energy use, at a cost of over $400 billion in electricity bills and operational expenses, according to the U.S. Department of Energy.

Existing buildings in the Seattle 2030 project will incrementally scale back energy and water use and  transportation emissions to 50 percent below the national average in 2030.

If goals are met, new buildings and major renovations should consume 60 percent less energy than the national average upon construction and eventually become carbon-neutral by 2030 — meaning that their net contribution of CO2 emissions to the atmosphere would be zero.

Targets are set for the district as a whole and are not measured building by building.

Energy-efficiency improvements alone are projected to cost roughly $17 million each year and employ nearly 330 full-time workers in Seattle, said Vincent Martinez, director of research for Architecture 2030, who leads the organization's participation in the Seattle district.

Brett Phillips, the sustainable director for Unico Properties, a regional property owner and manager, said: "We really look at this as a dual benefit." The program will "not only work toward climate stabilization," he said, "but [it will] also create a more competitive economic market for potential business and tenants."

Like most real estate markets nationwide, Seattle's industry took a hit from the economic recession, with property values and occupancy rates declining as unemployment figures ticked up.

According to budget data from King County, which houses Seattle, the value of all new construction is projected to fall more than 60 percent, from $1.7 billion to $667 million, between 2010 and 2011.

At the same time, Seattle's traditionally low electricity rates are steadily rising. Phillips said the main culprit has been a drop in water supply, which has restricted the amount of hydroelectric power the city's utility can sell at an out-of-state premium.

He added that encouraging district-wide energy efficiency is "an opportunity for us to engage our peers on a common interest — to make our market more competitive to attract businesses."

Architecture 2030's Martinez noted that boosting ride share programs and access to mass transit could help cut down on commutes to work and chip away at the $10 to 15 billion the state of Washington spends annually on imported oil.

To drive the initiative, Seattle 2030 will use a three-year grant totaling $500,000 from the EPA's Climate Showcase Communities Program and grants from the Bullitt Foundation to provide property owners and developers with the audits, tools and training necessary to reach the goals.

The EPA grant, awarded this spring, allowed Geller to leave his position at ZGF Architects to lead the Seattle 2030 project full-time.

Jess Harris of the city's planning and development department said that the EPA grant would also allow Seattle to expand its Priority Green permitting program, which expedites and streamlines paperwork from various departments for energy-efficient retrofits and upgrades.

"We're trying to create one-stop shopping" for permits related to the district, he said.

Oakland, Calif.-based Lucid Design Group is building a web-based master dashboard for Seattle 2030 to track hourly energy and water use for all participating buildings.

Geller said: "We'll be the first major urban area that's going to have something like that."

The city itself received a $20 million grant from the Obama administration's Better Buildings Initiative, which aims to increase the energy efficiency of commercial buildings by 20 percent in 2020.

Seattle also joined Los Angeles and Atlanta this summer in the federal initiative's Better Buildings Challenge to spur $500 million in private investment for energy efficiency improvements nationwide.

Geller noted that a huge push form the private sector has made his city's initiative unique compared to other urban efficiency efforts.

"[The city] is doing a lot to keep this effort moving forward but without necessarily leading it," he said.

Brandon Morgan, development manager at Vulcan Real Estate, said that his company joined the district early on to inspire other real estate firms to follow in Vulcan's sustainable footsteps.

"We're hoping to be the trailblazers to share that knowledge and our success stories with other building owners," he said.

"It is not very often that you have competitors sitting at a table thinking of ways we can collectively help each other learn from successes and failures."

Unico's Phillips added: "We're not looking at this as a competition block-by-block or building-by-building. We're looking at it as a competitive advantage market-by-market and city-by-city. We're positioning ourselves to compete against Portland, San Francisco and Los Angeles to attract businesses, as opposed to try to compete against owners or managers down the block."

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