Green Buildings: Fewer Sick Days, Higher Rents

Environmentally-friendly construction practices have gotten a lot of hype over the past few years but do they really pay off as an investment? A new study found that tenants in green buildings experience increased productivity and fewer sick days. The research also found that that green buildings have lower vacancy rates and higher rents than non-green counterparts.

The study, conducted by the University of San Diego and commercial real estate broker CB Richard Ellis Group, found that tenants in green buildings such as the Behnisch Architekten-designed Unilever offices in Hamburg above are more productive based on two measures: the average number of tenant sick days and a productivity change. Respondents reported an average of 2.88 fewer sick days in their current green office versus their previous non-green office. About 55% of respondents indicated that employee productivity had improved.

Based on the average tenant salary, an office space of 250 square feet per worker and 250 workdays a year, the decrease in sick days translated into a net impact of nearly $5.00 per square foot per year. The increase in productivity translated into a net impact of about $20 per square foot. The study also showed that green buildings have 3.5% lower vacancy rates and 13% higher rental rates than the market.

The work was based on surveys of 154 buildings under CBRE’s management, totaling more than 51.6 million square feet and housing 3,000 tenants in ten markets across the U.S. The study defined a green building as those with LEED certification at any level or those that bear the EPA ENERGY STAR ® label.

Another report out in the past week concluded that constructing new green buildings or retrofitting existing structures with energy efficient air conditioning, solar panels and the like will support 7.9 million U.S. jobs and pump $554 billion into the American economy over the next four years. The study, by the U.S. Green Building Council and Booz Allen Hamilton, determined that green construction spending currently supports more than 2 million American jobs and generates more than $100 billion in gross domestic product and wages.

The economic impact of the total green construction market from 2000 to 2008, the study found, was $178 billion. It created or saved 2.4 million jobs and generated $123 billion in wages.

The U.S. Green Building Council certifies LEED buildings and obviously has an interest in the movement, but Rick Fedrizzi, chief exec of the group said something remarkably down to earth in releasing the report: “Our goal is for the phrase ‘green building’ to become obsolete, by making all building and retrofits green – and transforming every job in our industry into a green job.”

Can’t argue with that.

View the original article here

Second Avenue Subway’s Impact On Rents

Posted by Jonathan J. Miller -Thursday, February 23, 2012, 5:49 PM
1 Comment

In one of the greatest column names ever devised during the illustrious history of the New York Times known as “The Appraisal” [wink], Elizabeth Harris, pens “Amid a Subway Project’s Dust and Noise, No Complaints About the Rent” about the war zone that is Second Avenue on the Upper East Side of Manhattan. I was on vacation when this was published earlier this week and I was forbidden to bring my laptop.

I was approached to try to take a stab at measuring the impact of the Second Avenue subway construction on the local housing market. Listen to the blasting.

Sales transactions move too slowly to capture the neighborhood impact since this is a relatively recent event of the past few years. So I looked at rents since they are smaller and more nimble.

Methodology
I divided a portion of the Upper East Side neighborhood into three zones (East 64th Street to East 96th Street) as follows:

The blocks to the east and west of Second Avenue (Third Avenue to First Avenue)The blocks to the west of Third Avenue (to Fifth Avenue)The blocks to the east of First Avenue (to East River)

I analyzed all the properties collected during our production of the The Elliman Report: Manhattan Rentals that actually rented in 2010 and 2011 and compared them. In a rental housing market that is seeing sharp gains in rents in the past year, I thought it would be interesting to see if there was a material difference in direction between the subway “zone” and everywhere else. I was only looking at “face” rents (the rent paid before deducting concessions) because I have more of that data.

And there was a difference.
In fact, the subway zone showed a 1.7% decline in median rent year-over-year, a 3.2% increase to the west and a 2% increase to the east. And the number of rentals in the subway zone increased 9% while the areas to the west and east fell 5.1% and increased 2% respectively over the same period suggesting that increased affordability may be attracting tenants.

Construction was supposed to be completed by 2016, but now it looks like 2018 or longer.

A gigundo transfer station…
[Courtesy: NYT]

…and trucks carrying explosives [Turn your head to left when viewing photo]…
[Courtesy: NYT]

While I was on vacation, I was contacted by Eyewitness News to discuss my numbers on camera but that wasn’t possible – although the online story includes no mention of the source of the results, the video did provide proper credit.

Thoughts
As time moves closer to completion some buyers may benefit from upside given how unpleasant some blocks are right now. The construction will likely provide downward pressure on housing prices in the near term but those along the zone will likely catch-up and perhaps even benefit from the transportation upgrade.

As a general rule, neighborhood property values tend to be higher in the west and lower in the east. It’s also possible that the price midpoint may shift further to the east than it is now once construction is completed.

Location specifics aside, additional subway access to and from the neighborhood should prove to be a tremendous asset to property owners in that area over the long run.

View the original article here

Globe Trotting: Under the Tuscan Sun Villa Rents For Staggering Price Tag

× Like us and you'll find top breaking news in your Facebook newsfeed. Sign up for our daily email newsletter and get top stories and breaking news delivered to your inbox. Monday, February 27, 2012, by Sarah Firshein

If the Eat, Pray, Love HSN home line doesn't quite do it, now there's a better, more complete way to indulge those decadent divorcee fantasies. In fact, some might argue that this is a truly excellent way of spending any monies earned in, say, a settlement: Bramasole, the villa featured in Under the Tuscan Sun, is available for nightly rental. In the 2006 flick, Diane Lane gazes upon the dilapidated structure—actually the stuccoed farmhouse on a two-house property—and espies its sunny, post-renovation future. This, as well as the main house, were renovated in real life and boast a total of 10 bedrooms and a shared pool, heated Jacuzzi, charcoal grill, and pizza oven outside. The place may be stunningly beautiful, but the price—a staggering $2,451 to $3,831 a night—quickly puts the brakes on any dolce vita daydreaming.

· Bramasole [Italian Villas via Hooked on Houses]

View the original article here

Green Buildings: Fewer Sick Days, Higher Rents

Environmentally-friendly construction practices have gotten a lot of hype over the past few years but do they really pay off as an investment? A new study found that tenants in green buildings experience increased productivity and fewer sick days. The research also found that that green buildings have lower vacancy rates and higher rents than non-green counterparts.

The study, conducted by the University of San Diego and commercial real estate broker CB Richard Ellis Group, found that tenants in green buildings such as the Behnisch Architekten-designed Unilever offices in Hamburg above are more productive based on two measures: the average number of tenant sick days and a productivity change. Respondents reported an average of 2.88 fewer sick days in their current green office versus their previous non-green office. About 55% of respondents indicated that employee productivity had improved.

Based on the average tenant salary, an office space of 250 square feet per worker and 250 workdays a year, the decrease in sick days translated into a net impact of nearly $5.00 per square foot per year. The increase in productivity translated into a net impact of about $20 per square foot. The study also showed that green buildings have 3.5% lower vacancy rates and 13% higher rental rates than the market.

The work was based on surveys of 154 buildings under CBRE’s management, totaling more than 51.6 million square feet and housing 3,000 tenants in ten markets across the U.S. The study defined a green building as those with LEED certification at any level or those that bear the EPA ENERGY STAR ® label.

Another report out in the past week concluded that constructing new green buildings or retrofitting existing structures with energy efficient air conditioning, solar panels and the like will support 7.9 million U.S. jobs and pump $554 billion into the American economy over the next four years. The study, by the U.S. Green Building Council and Booz Allen Hamilton, determined that green construction spending currently supports more than 2 million American jobs and generates more than $100 billion in gross domestic product and wages.

The economic impact of the total green construction market from 2000 to 2008, the study found, was $178 billion. It created or saved 2.4 million jobs and generated $123 billion in wages.

The U.S. Green Building Council certifies LEED buildings and obviously has an interest in the movement, but Rick Fedrizzi, chief exec of the group said something remarkably down to earth in releasing the report: “Our goal is for the phrase ‘green building’ to become obsolete, by making all building and retrofits green – and transforming every job in our industry into a green job.”

Can’t argue with that.

View the original article here