In the USA, the building sector accounts for 73% of electricity consumption, 41% of the country’s energy usage, and 14% of portable water usage.Given the monumental opportunity for positive climate change impact, real estate development and investment firms are taking note, out of will or necessity. While I would love to espouse the altruism of developers, today’s reality is that:
- Opex, ambience and productivity conscious retail and office tenants place a premium on sustainable buildings. In a world where rent per square foot matters, LEED (Leadership in Energy and Environmental Design) certification has progressed from a ‘nice-to-have’ when the program emerged ten years ago to a pre-requisite. Additionally, federal and state tax rebates further reduce the burden of up capital expenditure. There are currently 82,000 LEED projects in 162 countries and territories.
- According to NASA research scientist, George Tselioudis, there is a risk that we will see an increase in the intensity of extreme weather events in the 21st century due to global warming, prompting the development of future-proof structures resistant to floods and hurricanes.
International real estate developer, Related Companies (“Related”) is changing the face of Manhattan’s West Side with the Hudson Yards redevelopment project. This will be the largest private development in US history, at $20 billion expected cost and 17 million square feet of commercial and residential space. By incorporating the work of the world’s most renowned visionaries, architects, and business leaders, the development is expected to attract 125,000 people per day. Furthermore, it is being built on top of 30 active rail road tracks, with the help of two 80 feet high platforms.
Related’s innovative response to emerging trends in climate change can be summarized by:
- Efficient waste removal and recycling – A vacuum tube system transports waste at 45mph directly from chutes on each floor of the buildings to a central depository, eliminating refuse truck traffic and allowing for efficient conversion of organic waste to fertilizers.
- Reliability and safety, the platform ensures that the building remains safe in the event of a flooded Hudson River.
- Efficient use of power sources by enabling neighboring buildings to share a power and cooling source. For example, in the event that an air conditioner is turned on in an office building, rather than powering up the cooling system, cool air can be circulated from a neighboring, active retail unit. Utilizing cutting edge technology, Hudson Yards’ operations managers are harnessing big data-capture systems to monitor traffic patterns, air quality, power demands, temperature and pedestrian flow, optimizing energy consumption.
This is significantly more than the effort of some of Related’s peers, but as industry leader, we should expect more. Related has successfully achieved LEED certification level Silver and above on their last 27 developments, and most of the Hudson Yards buildings are expected to reach Gold status. LEED basis its ratings on forecasts submitted during development however, with no consideration for actual performance once built. By some estimates, LEED buildings are therefore 29% less efficient than their commercial alternatives.  If Related truly prides itself on its green stamp, the company should publicize annual energy consumption in its buildings versus estimates, coupled with updates on measures taken to improve efficiency when it fails to deliver. This would either serve to debunk LEED’s critics, or begin to address a fundamentally misleading metric used by developers across the world.
 Benefits of Green Building http://peer-credits.usgbc.org/articles/green-building-facts
 US Geological Survey (2000)
 Storms, Climate Change, and the US Economy: A National Analysis, George Tselioudis
 A Better Way to Rate Green Buildings, Henry Gifford