How Green Features Can Attract Tenants

The greatest benefit for a landlord is that green leases attract higher-quality tenants.

There is a clearly defined movement toward corporate sustainability through green initiatives. Green initiatives have the ability to lower operating costs for both landlords and tenants. The greatest benefit for a landlord is that green leases have the ability to attract higher-quality tenants. Tenants are looking for the advantage of lower utility costs and the ability to promote their business as green.

Following are a few simple tips to consider when promoting green features to attract potential

tenants:

There is Value in Being Green:

Consumers are demanding greener products and companies. In fact, some tenants are willing to pay a little more in order to lease a space that better represents their environmental values. By allowing tenants to take advantage of an environmentally sound tenancy, landlords can obtain favorable lease rates and tenancy terms.

Promote the Cost Savings of Green Construction:

Another tenant benefit is that greener construction saves them money in the long term. Green technologies offer savings on heating and cooling costs, and they reduce waterconsumption, which cost tenants valuable dollars every month. By offering tenants a building with green technologies, you can attract tenants by having lower consumable costs as opposed to a structure without energy saving technologies.

Closely Examine the Costs Versus the Return of Green Technologies:

Many savvy building owners are already seeing advantages to green building practices. Regular energy audits can identify problem areas and save landlords money. However, nobody wants to invest large amounts of money on green energy plans and not see a return on their investment. If the investment is solely a benefit to the tenant. landlords need to ask whether they can recover the investment through improved lease rates and tenancy retention. If not, then the value of the improvement does not meet or exceed the cost of making the change.

Property Assessed Clean Energy (PACE) programs:

In some states, PACE programs offer landlords an incentive to make the financial investment in green technologies. PACE programs for commercial properties are typically paid through a bond repaid by maintaining a higher tax rate. Landlords can see an added benefit if the lease terms have the tenant paying the real estate taxes.

There is a unique opportunity for landlords and tenants to work together when it comes to sustainable building infrastructure. By working together, both parties can maximize their returns on investment in green technologies. The goal for all parties is essentially the same, and that is to operate the buildings and businesses at the maximum environmentally sustainable level that is commercially feasible.

The ability to work together with tenants will solidify a long-term mutually beneficial relationship that has incentives for both

landlords and tenants.

Randy Bett www.BetterGroupRealEstate.ca