Go GREEN And Increase Your Commercial Income Property’s Net Profits

Sep 3, 2014

You’ve probably seen the calls to “go green” for some time now.

In fact, a recent poll showed that:

  • 90% of Americans recycle,
  • 47% buy green household products and
  • 39 bring their own reusable bags to the store instead of using paper or plastic.

green products


Increased Marketability And High Profits With Green Buildings

green buildings

And while it’s well-known that going green can save you thousands of dollars a year in operating costs and add years to your property’s life span, you may not realize that green buildings have increased marketability and higher profit gainst than comparable properties.

In fact, in the last few years commercial real estate has experienced a period of explosive growth. Experts predict that by 2015, an estimated 40-48% of new nonresidential construction by value will be green, which amounts to a $120-145 billion opportunity. Renovation projects are also expected to see significant growth, with an estimated $14 to $18 billion in major projects.

What’s more, commercial property tenants are now clamoring for green real estate, and are willing to pay significantly more money in order to live or work in green buildings. In Manhattan, for example, some commercial real estate brokers relate that for their clients, Class A is synonymous with green.

If you’d like to go green but find yourself strapped for cash, take heart. There are numerous things you can do that can have a drastic impact on your propery’s expenses and marketabililty, yet are relatively inexpensive to implement.


  1. Replace old T-12 fluorescent and metal halide lights with more efficient and longer-lasting options. (Energy savings over 30%.)
  2. Install occupancy sensors in restrooms, meeting rooms and offices. (Energy reductions range from 22 – 75%.)
  3. Install timers or photo-sensors on exterior lighting.
  4. Place timers on irrigation or sprinklers; don’t water when it is raining.


  1. Install attractive landscaping, or try planting just a few trees in key areas. (Retail customers are willing to pay 8-12% more for products in areas with mature tree canopies, are more likely to return more frequently, and are willing to travel further.)
  2. Upgrade HVAC chillers and fans. (HVAC accounts for 40% of the energy use in office buildings, 50% in schools, and 70% in apartment buildings.)
  3. Replace toilets that were installed prior to 1994.
  4. Installing solar water heaters can save you money on the long run, particularly for properties that use significant amounts of water, such as multi-family commerical properties, and health care facilities.

If you’re interested in going green but haven’t budgeted for it, keep in mind that there are often numerous incentives offered by local governments in order to encourage switching to green. Many cities allow commercial property owners to recoup the cost of green infrastructure directly through tax credits, fee credits, developmental incentives, and stormwater fee credits.

Other municipalities go even further, by offering rebates, cost-sharing, or even grants to offset the cost of installing green infrastructure. If you’re interested in finding out more about one of these programs, contact your local municipality for more information.

Have you implemented any green improvements at your commercial income property?

Join the conversation over at Google +.

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