Leasehold Improvements: Trends Toward Sustainability

Step Outin Style!.jpgThe entire nation has become increasingly environmentally conscious. To maintain our standard of living, we must address the important challenges of environmental sustainability: how can we meet our present demands on the environment without compromising the future generations? Sustainability has become a target goal to reach harmony in the human ecosystem where we can pursue unlimited economic growth in a closed system.

The federal and municipal governments have put numerous initiatives in place to address environmental issues such as climate change, air quality, water quality and protecting the natural heritage alongside economic and social considerations. This mentality has been trickled down and strongly adapted by commercial property owners and tenants. Data has shown that buildings of higher energy efficiency, water efficiency, and other measures of sustainability result in improved market competitiveness and lower operating costs. Top property owners go a step further to engage tenants on sustainability and occupant wellness through tenant engagement programs within commercial properties.

In Canada, Energy Star Portfolio Manager is a common standard and tool used to calculate a building’s energy footprint. Properties are looking to reduce energy use, greenhouse gas emission, water consumption, and landfill waste. State or federal government have implemented tax incentives to promote sustainability practices such as building automation systems, high efficiency water fixtures, lighting controls and sensors.

Building Certifications for Commercial Properties

Building certifications are voluntary, usually third party-assessed standards adopted by companies and owners to demonstrate the performance of their properties in specific areas. Building certifications have proven to increase reputation and market perception which increase occupancy rates and lower lease turnover. Property owners are placing every effort in achieving relevant building certifications.

Below are several green building standards and certification programs that I have observed in Toronto’s commercial market.

Building Owners and Managers Association’s Building Environmental Standards (BOMA BESt)
The BOMA BESt program is the Canadian industry standard for commercial real estate sustainability certification. The program assess environmental performance and management of existing buildings and is offered by the Building Owners and Managers Association of Canada (BOMA Canada) as a service to all commercial building owners and managers across Canada. Certification is available for five specific building types: offices, shopping centres, open air retail plazas, light industrial buildings, and multi-unit residential buildings.

Leadership in Energy and Environmental Design (LEED)

LEED is a third-party certification program and an internationally accepted benchmark for the design, construction and operation of high performance green buildings. LEED provides building owners and operators with specific checklists to track and measure impact on their buildings’ performance. Projects pursuing LEED certification earn points across several categories including energy use and air quality. Based on the number of points achieved, the project can earn one of the four LEED rating levels: Certified, Silver, Gold or Platinum. LEED certification has become a market expectation in core markets such as Toronto.

The Well Building Standard (WELL)

WELL is a third-party performance based certification program and standard for buildings, interior spaces, and communities to advance human health and wellness. WELL Certification program launched in 2014 through collaboration with the Green Business Certification Inc (GBCI), which also administers LEED certification. Projects pursuing WELL certification are to undergo a comprehensive evaluation involving on-site assessments and performance tests by third party experts. Achieving the WELL certification demonstrates that the property owners provide an environment that supports and enhances the health and wellness of its occupants.

 

Related Posts:

Introduction to Commercial Interior Fit-Out and Leasehold Improvements

Leasehold Improvements: Start-Up Documentation (Ontario)

Leasehold Improvements: Cutting, Coring, and Drilling (Base Building Structural Work)

Leasehold Improvements: How to Minimize the Impact of Construction on Commercial Tenants

Leasehold Improvements Site Condition: Asbestos

Leasehold Improvements Site Condition: Mould

Leasehold Improvements: How to Handle Unforeseen Site Conditions

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