Month: September 2015

Exploring Permeable Pavement Options for LEED Projects

By Julie Lundin, NCIDQ, LEED AP ID+C, Principal
Emerald Skyline Corporation

As business owners and designers of our renovation project in Boca Raton, there are many decisions and variables involved in the design of both the building and the site. This project is a LEED registered project which impacts our design decisions and materials selected to incorporate sustainable goals. It gave us the opportunity to explore sustainable pavement options rather than the traditional blacktop used in most projects. The size of the project, location, cost, financial incentives to explore alternatives, and local city requirements all impact decisions to be made. When a pervious pavement is used in building site design, it can aid in the process of qualifying for LEED Green Building Rating System credits.

Leadership in Energy and Environmental Design (LEED®) is a rating system developed by the United States Green Building Council (USGBC) to evaluate the environmental performance of a building. LEED is a voluntary, consensus-based national standard for developing high-performance, sustainable buildings.

LEED provides a framework for evaluating building performance and meeting sustainability goals through five credit categories: sustainable site development, water savings, energy efficiency, materials selection and indoor environmental quality. It should be noted, however, that LEED points are not gained directly by the use of a product but by meeting a specific sustainability goal of the rating program.

Pervious pavement options can contribute to many LEED categories including: Sustainable Sites, Water Efficiency, Materials and Resources, and Innovation in Design. Pervious pavement choices are unique and innovative ways to manage storm water and as a method of delaying roof runoff from entering city sewers. Considering these gives environmentally conscious business owners options to use in parking lots and walkways. When they are used in the building site design they function like storm water retention basins and allow the storm water to infiltrate the soil over a large area and recharge the groundwater supplies.

Why consider pervious pavement options?

Storm water is polluted

  • Oils and greases
  • Metals
  • Sediments
  • Fertilizers

Sustainability Factors

  • Low-Impact Development
  • Pollution Treatment
  • Recharging Ground Water
  • Tree Protection
  • LEED Requirements
  • Cool Communities

Meets LEED Requirements

  • Reduce Storm Water Runoff
  • Improve Storm Water Quality
  • Reduce Urban Heat Islands
  • Recycled Materials
  • Regional Materials

Description of specific credits where pervious pavement can aid the business owner or designer include:

 LEED Credit SS-C6.1 Storm Water Design – Quantity Control

LEED Credit SS-C6.2 Storm Water Design – Quantity Control

The intent of these credits is to limit disruption and pollution of natural water flows by managing storm water runoff, increasing on-site infiltration and eliminating contaminants. Pervious pavement can contribute to this credit by reducing storm water flow by allowing water to soak through and infiltrate to the ground below. Pervious choices can also reduce the pollutant loads by filtering contaminants as the water is transferred through the pavement.

 LEED Credit SS-C7.1 Heat Island Effect- Non-Roof

 Pervious pavement acts to reduce the heat island effect by absorbing less heat from solar radiation than darker pavements. The relatively open pore structure and the light color of pervious pavements store less heat, therefore, reducing the heat reflected back into the environment and helping to lower heat island effects in urban areas. The heat island effect can be further minimized by the addition of trees planted in parking lots. The trees offer shade and produce a cooling effect for the paving. Pervious pavement is ideal for protecting trees in a paved environment (many plants have difficulty growing in areas covered by impervious pavements, sidewalks and landscaping, because air and water have difficulty getting to the roots). Pervious pavements or sidewalks allow adjacent trees to receive more air and water and still permit full use of the pavement.

LEED Credit WE C1.1 Water Efficient Landscaping

 The intent of this credit is to limit or eliminate the use of potable water, or other natural surface or subsurface water resources available on or near the project site, for landscape irrigation. The gravel sub-base under pervious pavements can be used to store storm water for irrigation, helping to satisfy this credit. If no irrigation is required for a project, two points may be earned.

LEED Credits MR-C4.1 and MR-C4-2 Recycled Content

The intent of this credit is to increase the demand for building products that have incorporated recycled content material reducing the impacts resulting from the extraction of new material. Almost all ready mixed concrete contains recycled materials in the form supplementary cementitious materials (SCM) such as fly ash, slag, or silica fume. The use of SCMs or recycled aggregate in pervious concrete or base material contributes to recycled content needed for this credit.

LEED Credit MR-C5.1 and MR-C5.2 Regional Materials

The intent of this credit is to increase demand for building products that are extracted and manufactured locally, thereby reducing the environmental impacts resulting from their transportation and supporting the local economy. The majority of materials in pervious concrete and pavements are considered regional materials. In addition to aiding in gaining LEED certification points, pervious concrete can provide a safe and durable surface for most pavement needs. Light colored pervious pavements require less site lighting to provide safe night-time illumination levels, whether on parking lots, driveways, or sidewalks.

Types of Pervious Pavements

  • Porous Asphalt (Blacktop)
    • Low Cost
    • Effective Porosity
    • High Maintenance – Biannual cleaning to prevent clogging
    • Does not allow for plant growth
    • Contributor to heat island effect but better than standard ashphalt
    • Alternative for large projects
  • Pervious Concrete
    • Same concept as porous asphalt, except it is concrete
    • Easy to order and have installed
    • Light in color and not contribute to heat island effect
    • Higher Cost than Asphalt
    • Request use of local or reclaimed aggregates
    • Use highest amount of Fly Ash and/or Slag (both are reclaimed waste products)
    • Requires cleaning to prevent clogging
    • Can serve as a retention basin for storing rainwater during a storm
  • Pervious Block Pavers
    • Many different types on the market
    • Can look like traditional pavers for aesthetics
    • Filled in with grass or gravel
    • Allows for plant growth
    • Pavers are pricey
    • Installation requires laying of individual small blocks
    • May settle or become misplaced after use
  • Drivable Grass
    • Unique product
    • 2” x 2” mats that are more affordable individual pavers
    • Good infiltration for grass growth or ground cover
    • Plants remain cooler and receive uniform watering
    • Greener parking surface than other plantable systems
    • Low maintenance
  • Plastic Grid Systems
    • Made of recycled plastic and fully recyclable themselves
    • Low maintenance
    • Easy installation
    • Can provide a fully sodded surface if desired
    • Use only appropriate for light or occasional use parking lots

Decision making is a critical process for any project. Well informed choices and decisions can help keep a project timeline on track. Decisions in all areas including design and specifications need to be clearly and fully described. There should be at least three options to choose from that include how, what, where and how much? All the implications and impact of each option must be considered. Will it delay the project? Will it increase the cost?   A LEED project also needs to incorporate the analysis of products and design and their sustainable impacts. We are considering 3 categories of pervious pavement products for our project; pervious concrete, pervious block pavers, and drivable grass. With the ever evolving development of sustainable products, there may also be a hybrid solution available that will meet all of our project goals.

Vegetation is Not Solely for Landscape: The Benefits of a Green Roof

By Kendall Gillen, Biologist
Emerald Skyline Corporation

greenroofOn a hot summer day when it is 90º on the street, it can be twice as hot on the roof of most commercial buildings with a significant number of them made of black tar. Black roofs result in higher utility bills due to the higher HVAC costs. An alternative that is increasingly available is a “green” roof.

Further, green roofs can provide useable outdoor patio spaces which, according to a an article entitled “10 Most Wanted Office Amenities” in the 9/3/2015 National Real Estate Investor, is the seventh most desired amenity based on a survey conducted by Colliers International Group Inc.

A green roof is built like traditional roofs except a final layer of vegetation and soil, or a growing medium, is planted over a waterproofing membrane. Additional layers, such as a root barrier and drainage and irrigation systems may also be included.

According to the GSA Green Roof Report green roofs consist of a waterproofing membrane, growing medium (soil), and vegetation (plants) overlying a traditional roof. Green roofs are used to achieve environmental benefits including reducing storm water runoff, energy use, and the heat island effect. They are sometimes referred to as vegetated roofs or eco-roofs.

The history of green roofs started in ancient Mesopotamia where rooftop plants were grown from the Ziggurat of Nanna to the fabled Hanging Gardens of Babylon, one of the Seven Wonders of the World. The most recognizable green roofs in America were installed on Rockefeller Center in New York City. They continue to flourish today (see photo). More recent examples are the Gap Headquarters in San Bruno, CA and the Ford Motor Co. headquarters in Dearborn, MI.


Green roofs can be either “Intensive” or “Extensive.” Intensive roofs have thick soil depths with elaborate plantings that include shrubs and trees that require heavy load-bearing roof structures and regular maintenance. Extensive green roofs are mush lighter with shallow soils with low-growing ground cover plants that are extremely sun and drought tolerant. Extensive green roofs can be installed over various roof decks and require periodic maintenance.

The environmental benefits of a well-designed and well-maintained Green Roof are summarized as follows:

  • Stormwater Management
    • Most urban and suburban areas contain large amounts of paved or constructed surfaces which prevent stormwater from being absorbed into the ground. The resulting excess runoff damages water quality by sweeping pollutants into water bodies. Green roofs can reduce the flow of stormwater from a roof and delay the flow rate.
  • Energy
    • Green roofs reduce building energy demand by cooling roofs and providing shade, thermal mass and insulation.
  • Biodiversity and Habitat
    • Green roofs provide new urban habitat for plants and animals, birds and insects, thereby increasing biodiversity
  • Urban Heat Islands
    • Cities are generally warmer than other areas, as concrete and asphalt absorb solar radiation, leading to increased energy consumption, heat-related illness, and air pollution. Green roofs can help reduce this effect
  • Roof Longevity
    • Green roofs are expected to last twice as long as conventional roofs
  • Aesthetics
    • Green roofs can add beauty and value to buildings


Green roofs can earn LEED points in several credit categories. The total points achieved will depend upon the size of the roof and the degree to which various features are incorporated into the overall building design. These include but are not limited to storm water design, reduced heat island effect, habitat provided for wildlife, reduced cooling load, and many others. Green roofs help to reclaim green space and promote biodiversity.

LEED is a rating system developed by the U.S. Green Building Council (USGBC). It provides a standard certification process with five key areas of human and environmental health. It provides a roadmap to measuring and documenting success for every building type and phase of building lifecycle. LEED certification is achieved by earning points for a variety of credits.

Of the five major LEED categories and subcategories, below are the ones that have potential to earn credit from a green roof

Sustainable Sites

  • Protect or restore habitat and maximize open space
    • Adding vegetation on a green roof reclaims green space that has been taken up by the built environment
  • Storm Water Design
    • Green roofs help to reduce excess storm water discharge through evapotranspiration, periods of longer infiltration, or capture and reuse.
    • Pollutants and other toxins are filtered out of storm water by the green roof
  • Heat Island Effect
    • Green roofs significantly reduce roof temperature, particularly in summer months
    • Vegetated roofs and high-reflectance roofs now have equal weight when calculating LEED compliance

Water Efficiency

  • Water-efficient landscaping
    • When vegetated with local or native vegetation, drought-tolerant plants require little irrigation
    • The growing medium or soil can act as a sponge to collect rainfall, feed the vegetation, evaporate and filter excess rainwater
    • Runoff may occur in heavy rains, which can be channeled to an on-site cistern for collection and reuse in irrigation, ground-level landscape, and non-potable water usage within the building

Energy and Atmosphere

  • Optimize Energy Performance
    • Green roofs can provide varying degrees of reduced energy costs based on climate zone, building type, site, exposure, atmospheric conditions, and moisture content of the roof soil

Materials and Resources

  • Recycled Content
    • If green roof materials contain recycled content such as compost or reclaimed mineral aggregate, they can count toward recycled content credits
  • Materials and products that contain multiple environmental attributes can have a synergistic effect on LEED points earned

Innovation in Design

  • Having a green roof on a building can contribute to increased workplace productivity
  • Green roofs can be used in various building types for
    • Meetings and relaxation, education, creating beautiful views, fostering better health, reduced healing time, and increased positive social interaction
  • Green roofs can be integrated with patios and outdoor kitchens which expands the building space
  • An advanced green roof may even grow herbs, vegetables, and other consumables for the property


Summary of the Benefits of a Green Roof

 In addition to reduced utility costs, the benefits of a green roof include: (a) reduction of water runoff; (b) reduced sewage system loads by assimilating large amounts of rainwater (3” to 5” of soil absorbs 75% of rain events that are on-half inch or less); (c) protects the underlying roof material by eliminating exposure to UV radiation and extreme temperature fluctuations resulting in a longer lasting roof system. Other benefits include reduction of air and noise pollution, creation of urban living environments for birds, provision of useable outdoor patio spaces, as previously mentioned, and enhancement of a property’s marketability (especially when multiple elevations are incorporated into a project resulting in views overlooking other rooftops).

  • For Building Owners
    • Increase roof life
    • Reduce HVAC costs
    • Government incentives
    • Storm water management tool
    • Contribute to earning LEED certification
    • Improve public relations
    • Transform roof into living space
  • For the Community
    • Reduce storm water runoff and pollutants
    • Reduce heat island effect
    • Improve air quality
    • Noise reduction
    • Lower energy demand
    • Provide green space
    • Improve aesthetics
  • For the Environment
    • Neutralize acid rain effect
    • Provide habitat for wildlife
    • Lowers the load on sewer capacity
    • Encourages biodiversity
    • Filters pollutants from the water supply

Up-front costs of an extensive roof in the US starts around $8 psf all-in. By comparison, a traditional roof starts at $1.25 with cool roof membranes starting at $1.50 psf. However, the additional installation costs are off-set by energy savings and the extended life of the roof and possible savings on the storm water infrastructure.   Finally, a property with a green roof will be more marketable to prospective tenants.

The benefits of a green roof are innumerable for building owners and occupants, the built environment, and the natural environment. Green roofs are a primary example of the advances in environmentally friendly systems that are available to enhance your commercial properties.

The Capital Budgeting Analysis of a Sustainability Project

by Paul L. Jones, CPA, LEED Green Associate, Principal,
Emerald Skyline Corporation

calcRegardless of whether you are building your ark and waiting for the sea level to rise or if you are a climate-change denier, the writing is on the wall: sooner or later, you will need to modernize your building to improve its sustainability and resiliency. Accounting for almost 40% of the world’s energy consumption and greenhouse gas emissions, buildings are considered a high-impact sector for urgent mitigation action on climate change.

Accordingly, building owners, managers and tenants need to assess the opportunities and possibilities for improving sustainability in order to optimize the benefits realized – both physically through reduced consumption and waste and financially through proper planning, budgeting and financing.

Let’s begin by recognizing that there is a robust business case for investing in sustainability and resiliency measures (see the Sustainable Benefits article “Welcome to Sustainable Benefits – Let’s begin with the benefits of doing a commercial building sustainable retrofit….”) which enables the stakeholders to improves profits, saves the planet and be socially responsible corporate citizen (the “Triple Bottom Line”).

The first step in creating a sustainable retrofit program is to benchmark the property. According to Ms. Clare Broderick in her article, Creating an Energy Efficient Plan – One Step at a Time, (, 3/4/2015), “There is much truth to the adage, “whatever you measure improves”.  Whether you are responsible for one building or a portfolio of properties you need to know your starting point in order to gather quantifiable results.”

Another step to facilitate the cooperation and sharing of costs and benefits between the landlord and the tenant is to align the interests through a Green Lease (for more on Green Leases, see the Sustainable Benefits article “Overcome Obstacles to Going Green with Green Leases“). Systematically including sustainability clauses at lease creation or renewal facilitates energy efficiency, sustainability and resiliency retrofit projects.

Sustainability and resiliency measures are not all capital-intensive. Many relate to building operations – like aligning operating hours with actual building occupancy or changing the time when cleaning crews work. Conventional wisdom states that the best way to start a sustainability program is to begin with free or low-cost measures which creates an environment where people who work or visit a building start thinking about reducing, reusing and recycling. (see the Sustainable Benefits article “Going green – Fifty free or low cost ways for commercial property owners, managers and tenants to begin.”).

While low cost measures and the replacement of energy-inefficient lighting and equipment occurs at the time of natural replacement as part of the annual capital budgeting process for property maintenance, the timing for a significant building sustainable retrofit is usually determined by the investment or occupancy cycle of the building:

  • To attract a new tenant or retain an existing one;
  • As part of the process to prepare a property for sale; and
  • Upon acquisition as part of a value-enhancement business plan.

Maximizing the benefits from investing in the modernization (sustainability) and risk-reduction (resiliency) of a building utilizes a capital budgeting approach and requires the diagnostic review of the building which provides an understanding of the current equipment in use and an assessment of the improvements that can be made to accomplish your sustainability goals and objectives. The key to stakeholder action is to use capital budgeting based on forward-looking investment plans that facilitates the decision-making process.

In addition to planned equipment replacement upgrades, the first type of upgrade which is typically analyzed and approved as part of the annual management plan involves low-impact initiatives which generally have a short payback and can be implemented in currently occupied/leased buildings. These measures include commissioning an energy audit, replacing lighting and installing occupancy sensors and mid-level building energy management and control systems with interval energy data monitoring among other programs. In the case of these types of improvements, the capital budgeting decision can be limited to the relevant costs and benefits as hereinafter described.

The second is referred to as a “deep refurbishment” or “deep retrofit” project that aim to achieve high energy performance of the whole building which may include upgrading the building envelope, replacing the base building lighting systems, installing next generation smart building automation systems, adding solar or other renewable energy systems that require significant capital investment that cannot be recovered solely through the energy savings of the first few years, and the financial analysis of investment opportunities needs to include the impact on asset values.

Simple capital budgeting measures that are commonly used by engineers and contractors in proposals are the Payback Period and the Return on Investment:

  • The Payback Period in capital budgeting is the amount of time necessary to recapture the investment in a retrofit project, or to reach the break-even point. For example, the cost to upgrade lighting to LED is $25,000 which is forecasted to generate $14,000 in energy and maintenance savings would have a 1.79 year payback period (Cost divided by annual savings or earnings).
  • The Return on Investment is the inverse of the Payback Period and calculates the percentage return on an investment relative to the investment’s cost. In our example, the Return on Investment would be 56% (annual savings or earnings divided by cost).

While both the Payback Period and Return on Investment provide a quick way to evaluate and compare capital projects, the next level of analysis is multi-year and involves the time value of money which are commonly used in analyzing real estate investments. They are the Discounted Cash Flow, Internal Rate of Return. Another method is the Profitability Index and, finally, the method that is recommended in evaluating alternative investments is Life Cycle Costing. For all of these measures, it is important to forecast anticipated savings, earnings and costs over the investment horizon (typically, the life of the equipment):

  • The Discounted Cash Flow (“DCF”) method “discounts” the estimates of future savings, earnings and costs using the cost of capital or other investment threshold to arrive at a present value estimate. The cost of the project is then deducted from the present value to arrive at the Net Present Value (“NPV”). The project is acceptable if the NPV is greater than zero. It can also then be used to compare to other projects.
  • The Internal Rate of Return (IRR) is the rate at which the NPV of cash flows of a project is zero (i. e, the rate at which the present value of the future cash flows equals the initial investment). This is a yield calculation and the project is acceptable if the project IRR is greater than the Cost of Capital or other investment return threshold.
  • The Profitability Index (“PI”) is calculated by dividing the present value of the project’s future savings, earnings and costs by the initial investment. A PI greater than 1.0 indicates that the profitability is positive while a PI of less than 1.0 indicates that the project will lose money (the NPV would be less than zero). It is a useful tool for ranking alternative projects because it allows for the quantification of the value created per unit of investment. Most of the time the PI will be consistent with the NPV methodology; however, they may be in conflict due to different project scale or different pattern of cash flows. Conventional wisdom is to use the NPV when the PI is in conflict with it.

In each of the NPV, IRR and PI, the future savings are determined using the difference in future consumption/expenditures based on the economy of the new equipment or process over the anticipated costs of continuing use of the existing equipment.

  • Life Cycle Costing (“LCC”) is a tool to determine the most cost-effective option among different competing alternatives to purchase, own, operate, maintain and, finally, dispose of an investment in property, plant, equipment or process. According to, it is the “Sum of all recurring and one-time (non-recurring) costs over the full life span or a specified period of a good, service, structure or system. It includes purchase price, installation cost, operating costs, maintenance and upgrade costs, and remaining (residual or salvage) value at the end of ownership or its useful life.”

Consider the following example in the selection between two air handling units (from “Sustainability/LEED and Life Cycle Costing – Their Role in Value Based Design and Decision-Making” by Stephen Kirk, PhD, and Alphonse J. Dell’Isola, PE, date unknown):

Consider the selection between two air handling units. A 10% discount rate, a 24-year life cycle and a differential energy rate escalation of 2% per year are assumed. Other relevant data (NOTE: For all capital budgeting decisions, only incremental cash flows are included. Accordingly, sunk costs – those costs that have already been incurred – cannot be a part of the incremental cash flows used in the financial analysis of a capital project.) are:

Type of Cost Alternative 1 Alternative 2
Energy Efficient Economy
Initial cost $15,000 $10,000
Energy (annual) 1,800 2,200
Maintenance (annual) 500 800
Useful life 12 years 8 years


The solution begins by converting all annual or recurring costs to the present time. Using the present worth annuity factor, the recurring costs of maintenance would be:

Alternative One: maintenance (present worth) = $500 x (8.985) = $4,492

Alternative Two: maintenance (present worth) = $800 x (8.985) = $7,188

According to the discount rate tables, the present worth of the energy costs for each alternative would be:

Alternative One: energy (escal. @ 2%) = $1800 x (10.668) = $19,202

Alternative Two: energy (escal. @ 2%) = $2200 x (10.668) = $23,470


Replacement or nonrecurring costs are considered next. When one or more alternatives has a shorter or longer life than the life cycle specified, an adjustment for the unequal life is necessary. If the life of an alternative is shorter than the project’s life cycle, the item continues to be replaced until the life cycle is reached. On the other hand, if the item life is longer than the specified life cycle, then a terminal or salvage value for the item is recognized at the end of the life cycle. This treatment using the present value factors is illustrated as follows:


Alternative Two: replacement (n = 8) = $10,000 x (0.4665) = $4,665

Alternative One: replacement (n = 12) = $15,000 x (0.3186) = $4,779

Alternative Two: replacement (n = 16) = $10,000 x (0.2176) = $2,176

The salvage value for both systems equals zero since they both complete replacement cycles at the end of the twenty-four year life cycle. A summary of present worth life cycle costs follows:


Type of Cost Alternative 1 Alternative 2
Energy Efficient Economy
Initial cost $15,000 $10,000
Maintenance (recurring) cost 4,492 7,188
Energy (recurring) cost 19,202 23,470
Replacement (nonrecurring), year 8 0 4,665
Replacement (nonrecurring), year 12 4,779 0
Replacement (nonrecurring), year 16 0 2,176
Salvage, year 24 0 0
Total present worth life cycle costs $43,473 $47,499


The first alternative would be selected on the basis of this LCC analysis.

Of course, any analysis should reflect the rebates that are available from manufacturers, utilities and governmental agencies.

As you can tell, the simple Payback Period and ROI analyses may be appropriate for small projects, like replacing the lighting, but using the DCF, IRR and PI methods provide better information while Life Cycle Costing Analysis provides the best basis for evaluating a project, or alternatives among projects, in making the capital budgeting decision.

As a CPA, I know that these analyses require time and skill to accurately prepare, but making sound capital budgeting decisions when improving a property using these techniques is the lynchpin of profitability. Emerald Skyline Corporation is uniquely qualified to be your advocate in planning, analyzing and executing your sustainable and resilient retrofit project.

In my next article, I will present the investment analysis of a “Deep Retrofit” as pioneered by Rocky Mountain Institute.

Renovation Versus New Construction – Choosing the Right Path


By Julie Lundin, NCIDQ, LEED AP ID+C, ASID, Director, Emerald Skyline Corporation

As both the owners and the designers of a commercial building in Boca Raton it was essential that we examine the pros and cons of renovation vs. new construction and the impact on our project. When considering renovation vs. new construction for any project, it is important to understand that both paths lead to different and unique results. Comparing the merits and challenges of each against the needs of a project is crucial in determining what the best options are. Our design team collaborated and brainstormed to determine the issues involved, document the issues and prioritize them. This process helped us to determine that a major renovation will make the most sense for our building and our sustainable goals.

The building is an unoccupied auto body shop located on a former brownfield. Whether to save or demolish an old building has always been a question for owners, developers and cities. We are applying the concept of adaptive reuse to this project. It is the idea of “twice green”, not just repurposing an older building, but also making it even more environmentally friendly in its new life. This project will convert an existing eyesore structure into a rehabilitated sustainable building.

How green is adaptive reuse?

The National Trust for Historic Preservation published a report on the environmental benefits of adaptive reuse. The Greenest Building: Qualifying the Environmental Value of Building Reuse, demonstrates through case studies that reusing buildings can save from between 4 to 46% over new construction.

These findings include:

  • Reuse Matters. Building reuse typically offers greater environmental savings than demolition and new construction. It can take between 10 to 80 years for a new energy efficient building to overcome, through efficient operations, the climate change impacts created by its construction.
  • Scale Matters. Collectively, building reuse and retrofits substantially reduce climate change impacts.
  • Design Matters. The environmental benefits of reuse are maximized by minimizing the input of new construction materials. Renovation projects that require many new materials can reduce or even negate the benefits of reuse.
  • The Bottom Line. Reusing existing buildings is good for the economy, the community and the environment. At a time when our country’s foreclosure and unemployment rates remain high, communities would be wise to reinvest in their existing building stock.

The U.S. Green Building Leadership in Environmental and Energy Design (LEED) strongly encourages reuse of an existing site and building. By using LEED principles during design and construction points toward LEED accreditation can be achieved. The incorporation of sustainable solutions into our design and materials will create a healthier building, reduce negative impacts on the environment, and utilize the economy of reuse. Every material has an impact, the fewer building materials used in a rehab project, the less environmental impact there will be.

The decision to renovate rather than build new has many challenges. Key factors typically considered in this decision could have easily sent us in a different direction if sustainability was not important to our project. The budget to accomplish a major renovation for this project may not cost less than new construction but the sustainable benefits are significant. The condition of the current structure will require many changes and improvements. The building needs updated technologies, energy efficiencies, and time challenges to complete. By renovating we are diverting waste from being placed in landfills, we are disturbing less native vegetation and contributing less erosion and adverse effects on the land. The decision to renovate this older structure will provide a safer and healthier environment for its users while creating an enhanced appearance.

The existing footprint allows only so much floor space. To overcome this, we are going vertical and building a partial second floor. Building above is less expensive than building outward. A key consideration in many designs should be on how to best utilize the building while using smaller spaces.

The age old question of whether to build new or renovate has become even more complex as we seek to determine which has the least amount of impact on our environment. While the ease of new construction may be preferred, the greater potential for reducing your carbon impact during renovation compared to a new construction is apparent over a 75 year life span of a building. As The National Trust for Historic Perseveration recently stated that the greenest building may be the one you already own – and this is the reason we selected to renovate rather than build new.

Beauty and Function: Landscaping for Sustainability

KG Resize
By: Kendall Gillen, Biologist, LEED Green Associate
Associate LEED Process Management for Emerald Skyline Corporation

Many building owners and managers take into account the interior and exterior of a building itself when considering sustainable initiatives, but just as important is the area surrounding the building. Landscaping can make a tremendous difference in the sustainability and qualification for LEED certification of a project. Sustainability is certainly an integration of many different factors, and landscaping is a significant one.

Through employing different strategies, landscaping can be practical, functional, and aesthetically pleasing. There are different factors that affect the level of landscape sustainability. Two of the most important are the types of vegetation chosen and the amount of potable water required to keep the plants healthy, otherwise known as irrigation. Not only can efficient landscape design provide noteworthy credit toward achieving LEED certification, but it can also provide substantial water-energy savings. This should be a great motivator for owners and managers to look to their landscaping for improvements to their bottom line.

As stated in a study conducted by the California Sustainability Alliance, water is a necessary resource for any landscape to survive and function[1]. However, not all landscapes are created equal. Climate, weather conditions, and vegetation grown can all impact the amount of water required to sustain life. Typically, if non-native plants are chosen, irrigation will be needed because they cannot survive on local precipitation levels alone. Thus, researching plants with a low water need specific to the project’s local climate is of the utmost importance.

Many states have online databases for irrigation friendly plants. Since we are located in the tropical climate of South Florida, here are just a few of the many trees, plants, flowers, and grasses that are ideal for reducing irrigation demand as found by the Florida-friendly Plant Database:

  • Silver Palm
  • Scrub Palmetto
  • Cocoplum
  • Seagrape
  • Jamaica Caper Tree
  • Gumbo Limbo
  • Fiddlewood
  • Crinum Lily
  • Blanket Flower
  • Beach Sunflower
  • Purple Love Grass

All of the above vegetation has a medium to high drought tolerance. There is also a resource listing the Plant Hardiness Zones for the entire nation available through the USDA. Once a project’s Plant Hardiness Zone is found by zip code, one can search for plants that thrive within that particular zone.

Choosing native vegetation is a step in the right direction, however without active management of landscape irrigation with adjustments to precipitation levels, the savings of native vegetation alone could potentially be nominal. To fully benefit from using indigenous and drought-resistant vegetation, the irrigation system must be managed. This is why the integrated process of landscape operation, management, and maintenance is so crucial.

  • Low-volume irrigation systems are a broad classification of systems that provide water more directly to the ground instead of spraying in the air where water can be lost to wind or evaporation.
    • This is a great starting point when choosing a system that fits a specific sustainable project need. By slowly releasing moisture, these systems greatly reduce runoff1.
  • Rainwater collection and re-use for landscape irrigation is another method to decrease water-energy expenditures. This harvested water can also be used for non-potable purposes such as toilet flushing.

The benefits to native vegetation and water efficient landscaping are plentiful. As previously stated, huge savings in water-energy can be achieved as well as the following:

  • Reduces the heat island effect which occurs when dark building and paving surfaces absorb the sun’s energy and re-radiates it throughout the day and night raising the ambient air temperature
  • Conserves natural resources and provides a habitat for native wildlife
  • Improves HVAC efficiency which is achieved through the shade generated by the proper selection and placement of trees and shrubs
  • Minimizes landscape maintenance requirements allowing the building owner to save on labor and materials

Undoubtedly, landscaping can play a huge role in the overall sustainability of a project, whether that is a retrofit or new construction. The take-home message should be to plan ahead and strategize when it comes to landscaping and irrigation. Also, having a water efficient landscape does not necessitate elimination of beauty. Use the abundant resources available online or through a professional and be responsible with water use. Water is in fact our most precious natural resource and it is our obligation to conserve.

[1] California Sustainability Alliance. Water-Energy Savings from Efficient Landscape Design in California. July 2015.

When assessing risk and reward in acquiring commercial real estate – be sure to cover all your bases including sustainability and resiliency

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by Paul L. Jones, CPA, LEED Green Associate

It is a great day – you have just put a property you like under contract. Now the work begins…conducting your acquisition due diligence. You know the program:

  • Obtain the deliverables from the seller
  • Research title for exceptions and obtain insurance binder
  • Ensure compliance with building and zoning codes
  • Engage the appraiser
  • Hire an engineer to conduct a property condition assessment
  • Hire an environmental engineer to prepare a Phase I environmental site assessment
  • Abstract leases and agree to the rent roll, check expense pass-through calculations and conclude on in-place and prospective income
  • Analyze the market and assess the property’s competitive profile including Green certification, utility expenses (electricity, gas, water and waste) and resiliency
  • Review all existing contractual relationships and obligations, including property maintenance, service and other agreements, warranties (equipment, roof, elevator, etc.)
  • Obtain property insurance quote and coverage binder
  • Establish the veracity of the operating statements and establish an operating budget
  • Update the cash flow forecast and yield assessment to evaluate the purchase price and desirability of the investment

What if I were to tell you that with all this work, you may not have covered all your bases. Let’s go back to the purpose of your acquisition due diligence: to ensure that you are getting what you thought you were getting and to assess, eliminate or quantify the risk and rewards in the investment.

Just like your market analysis which looks at both current conditions as well as the pipeline of future competition and the affordability of new competitive construction; In a rapidly changing environment, it is important for purchasers and investors in real estate to evaluate the property’s operating and energy efficiency, indoor environmental quality and resiliency as well as anticipate future environmental, regulatory and operating conditions.

Regardless of your personal position on climate change and sea level rise, commercial real estate is going to be affected – and because of real estate’s primary characteristic – it is immovable – the effects can be significant.

  • According to the report, “Risky Business: the Economic Risks of Climate Change in the United States” which was published last summer, “If we continue on our current path, by 2050 between $66 and $106 billion worth of existing coastal property will likely be below sea level.”
  • FEMA is anticipating a 45% growth in the areas susceptible to flooding due primarily from sea level rise by the end of this Century – just 85 years away.
  • According to the Institute for Market Transformation, “fourteen cities, two states and one county in the United States have passed laws requiring benchmarking and disclosure of energy use in buildings.” To learn more about where and under what conditions benchmarking is required, go to org. (FYI – these requirements are soon to affect over 5 billion square feet of space AND the EPA estimates that buildings that are benchmarked save an estimated 7% in energy over three years).

PJ Building Benchmarking

I live in Miami. Last week, we were in the cone of TS Erica which looked like it could grow into a hurricane. Businesses and people in South Florida began making preparations by buying staples like gas, batteries, non-perishable food supplies and reviewed their disaster plans. Thanks God the storm did not materialize and all we had was a hard rain which did cause flooding throughout our community. Climate change and sea rise are similar – you prepare for the worst and hope for the best. It does not hurt that in preparing for the worst, we actually are able to delay the time for the rise to occur (through a reduced carbon footprint). Accordingly, prudent investors are well advised to include the following additional due diligence procedures to assess the sustainability and resiliency risk inherent in the property.

  • Obtain information on the risks the local community experiences due to climate change which could range from increased storm intensity and flooding due to sea level rise, wild fires and water restrictions due to drought conditions, or increased utility usage due to higher average temperatures.
  • Obtain information on new or prospective municipal environmental requirements and evaluate the property leases and operations to determine the ease and cost of compliance.
    • For instance, if benchmarking is going to be required, do the leases in place require the tenant to share utility usage information (if, as is the case with many properties, the tenant pays utilities directly).
  • In an era of increasing utility costs and more efficient lighting, HVAC and other systems, do the leases provide for a proper sharing of the cost of replacing the equipment if it results in a reduction in utility usage? See my article on Green Leases in the Sustainable Benefits archives.
  • Obtain current and prospective FEMA flood maps to ascertain the risk and timeline the property will be in a flood zone in the future.
  • If the property is not a Green-rated building (LEED, EnergyStar, etc.), have the engineer assess the age and efficiency of the building systems.
  • From your insurance agent, obtain information regarding anticipated future availability and rate increases.
  • In evaluating the competitive leasing market, evaluate the relative absorption, rents, occupancies and tenant quality of Green buildings vs. traditional buildings to determine the market demand for sustainable buildings.
  • Evaluate the building’s ability to absorb and recover from to actual or potential adverse effects of stronger storms (wind and rain), higher storm surge and more frequent flooding in coastal areas or tornados, wildfires and dust storms in other areas. Each location has its own set of risks. Some resiliency due diligence questions to ask are:
    • Is the building site and entrance flood-proof?
    • Is the landscape design hazard-resistant?
    • Does the building have back-up power systems including HVAC and water)?
    • How secure is the interior environment from damage due to higher storm intensity?

The checklist of due diligence items and questions to be answered with regard to a property’s sustainability, resiliency and ability to comply with ever evolving government, insurance company and tenant requirements needs to be customized based on the location of the property as well as its class and quality.

In a November 2014 article, “Do-or-Die Due Diligence, Vice President Andre Cuadrado warns “The due diligence process is one of the most important, yet challenging aspects of investing in real estate. If it’s not conducted thoroughly with a keen eye, an investor could end up with bad deals and lose millions of dollars.”

Cuadrado advises investors to spend the time and resources necessary to conduct due diligence thoroughly. “Some people try to save money on the process,” he notes, “but it’s expensive to be cheap when conducting due diligence, as your investment may end up not being what you thought it was.”

Remember, as Sun Tzu is quoted from The Art of War: “Every battle is won before it is even fought.” This is true for real estate investing as well – complete and thorough due diligence is the key to risk reduction and profit enhancement.

The breadth and depth of our experience and understanding of commercial real estate due diligence, sustainability and resiliency, Emerald Skyline Corporation is uniquely qualified to be your advocate in planning and executing your due diligence needs.