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March 27, 2014
Dear Clients, Friends and Colleagues,
While big, hairy, audacious goals help propel us toward achieving transformational results when it comes to climate change solutions, often it's a series of less-than-monumental, incremental achievements that actually result in those transformations.
 Over the past decade, the transformation of retail real estate to a lower carbon footprint has ranged from "not happening" to "slow and grudging." Retail real estate industry professionals were definitely latecomers to the green building party. While there were many reasons for this, there was really no good enough reason, and lately the dynamics are shifting. In addition to the zero net energy use store that Walgreens opened in November, the record number of solar installations that Walmart completed in 2013 and the great strides in energy and water efficiencies that companies like Macerich, Simon and Regency are enjoying throughout their portfolios, there are two recent less-than-monumental, incremental achievements in the retail real estate world that signify what I believe is the beginning of a meaningful transformation of the industry to a lower carbon footprint. Small Steps With Great Potential
Property Efficiency Scorecard. Not satisfied with how shopping centers fared under third-party green building rating systems like the Leadership in Energy and Environmental Design (LEED) rating system, retail real estate owners took matters into their own hands and through their industry association, the International Council of Shopping Centers (ICSC), they created the Property Efficiency Scorecard (PES). The PES is an online tool that helps owners measure the energy and water efficiency, waste and green operations of their retail properties, taking into consideration the unique ownership structure of retail properties.
Launched at the end of 2013, there are almost 1,000 centers that have been subjected to PES scrutiny. Stay tuned. As the dust settles we'll see if there is widespread acceptance of this tool by retail owners and other stakeholders as a viable way to measure the relative efficiencies of different properties. As with other green rating systems created by and for the population being rated, there is a perceived lack of objectivity and transparency that ultimately will have to be overcome in order for this tool to be meaningful.
The Shopping Center Study Green Lease. The ICSC has just published a Study Green Lease for retail properties. Recognizing that the lease is the single most important transactional document when it comes to greening tenant-occupied commercial properties, the ICSC took what some consider a bold step in putting its imprimatur on a "green" lease.
 In full disclosure, I prepared this lease on behalf of the ICSC, but I'll be the first to admit that it is just a starting point for educating landlords and tenants about the leasehold issues they should be considering when sustainability goals are being incorporated into a project's future. The most important consideration, from my perspective, is how the costs and benefits of green building improvements are shared between a landlord and tenant. While there is no one size that fits all or "right" answer, the Study Green Lease is an important resource for industry professionals who are working on these issues. The Study Green Lease can be purchased at ICSC.org. Please note that neither I nor Green Edge has any financial interest in the sale of the Study Green Lease, but of course Green Edge and I are devoted to the transformation of the built environment to a lower carbon footprint and the Study Green Lease will push the built retail environment one small step closer to this transformational result.
Green Benefits Will Prevail Ultimately, the benefits of greening the built environment, including the billions in energy cost savings, coupled with an increasingly stringent regulatory environment, will prevail as green buildings become the norm rather than the exception. Let us help you green your buildings, your companies and your leases, you can't afford not to. |
