The Business Case for
  Building Green

[ By Rod F. Wille ]

It’s a given that green buildings are environmentally aware, energy-conscious and generally healthier places to live and work. More recently, however, with advances in design and technology, as well as a plethora of new products available at more competitive prices, green buildings have become solid economic investments.

Moreover, the sustainable design movement has progressed beyond its early market segments of public and educational projects to a broad range of building types that now include commercial, industrial, healthcare and R&D facilities.

The 624,000-square-foot Toyota South Campus project in Torrance, California, was built at a competitive first cost. Turner installed 53,000 square feet of rooftop voltaic panels that can generate about 20 percent of the building’s total energy usage.

From a builder’s perspective, several of the advantages of green buildings (see Sidebar: 10 Studied Advantages) are quantifiable and have been proven on green projects that Turner Construction has recently built.

Consider the recovery of higher up-front costs on an 18-story commercial office building in the Northeast that used “dual flush” water closets, for example, instead of standard toilets that consume 1.6 gallons of water per flush. The “dual flush” unit cost an additional $540 for the fixture and labor to install it, for a total first cost premium of $97,200 (10 toilets/floor times 18 floors).

If one assumes that 50 percent of the time only one flush will be used on the “dual flush” fixtures, the annual savings is 360,000 gallons of water or approximately $10,000/year in water and sewer cost savings. With a nine-year payback on the first cost premium, and annual savings of $10,000 thereafter, this green feature would make good economic sense (and conserve a significant amount of a natural resource).

The Toyota facility’s core/shell construction cost was $63 per square foot. Interior construction cost $26 per square foot.

On the 624,000-square-foot Toyota South Campus office development in Torrance, California, Turner installed 53,000 square feet of rooftop photovoltaic panels that can generate 550 kw of electricity, or about 20 percent of the building’s total energy usage. Designed to shave peak demand in the summer cooling season, the savings from reduced reliance on the grid will take about seven years to pay back the first cost investment of $1.6 million, according to Toyota executives.

Integrated design is another significant advantage of a sustainably designed building. An integrated design differs from the traditional unilateral approach of an architect drawing the exterior wall, the engineer designing the mechanical and electrical systems, the interior designer creating the interior environment and the construction manager pricing each component separately. Now, through modeling and other design methodologies, the entire building can be analyzed for energy, esthetics, indoor environment, first cost and life cycle cost. In this way, building owners can make an informed decision early on in the design on how best to invest their money.

An integrated design led to significant cost savings on two recent projects for the Fred Hutchinson Cancer Research Center in Seattle, Washington, totaling 898,000 square feet. The designers took a holistic building approach by analyzing the thermal characteristics of the building envelope, incorporating an interstitial space between floors for access to mechanical and electrical systems, incorporating a high level of automation (sensors for temperature, light and motion) and using very high efficiency equipment throughout.

This “integrated” design resulted in “integrated” savings: $1.9 million in one-time utility company rebates, $850,000 per year in utility savings (electricity and water) and $700,000 per year in operational efficiency savings (i.e, fewer operating engineers needed due to interstitial space and automation).

Specialized Products and
Natural Daylight

For example, there are now more than 25 reputable manufacturers of low (or zero) VOC (volatile organic compound) paint. VOC emissions from paints and coatings are indoor air contaminants that are odorous and potentially irritating and/or harmful to the comfort and well-being of building occupants, as well as to the installers of these products. As a result, designers can now specify low VOC products that are high quality, competitive in cost (to “standard” paint) and readily available in the marketplace.

Rooftop photo-voltaic panels can generate 55 kw of electricity. Savings from reduced reliance on the grid will take about seven years to pay back the first cost investment of $1.6 million.

Some green features of the Toyota facility include extensive daylighting and an average of 50 percent recycled content in overall building materials. Turner recycled 96 percent of construction waste, at a savings compared with sending waste to landfills.

On a current Turner project, the executives at Genzyme in Cambridge, Massachusetts, decided that the health and well-being of the workers in their proposed 300,000-square-foot world headquarters was a high priority. As a result, the designers were asked to bring natural daylight into each occupant’s workplace.

Technology allowed for a system of seven heliostat deflecting mirrors on the roof to track the sun’s position and divert sunlight into the central atrium. Additional operable sunshade prisms were installed to reflect direct sunlight while allowing diffused daylight to enter the atrium and adjacent offices. On the perimeter façade, a real-time weather station monitors sunlight conditions and controls automated blinds that bring daylight into perimeter offices. Clearly, these systems were a first cost premium, but in addition to the aforementioned health and well-being benefits, there will be a significant energy savings via the use of natural daylighting as well as a potential increase in worker productivity.

A key advantage of green building is the use of best practices to achieve more predictable results. For those owners looking for a green roadmap, the Leadership in Energy and Environmental Design (LEED) rating system developed by the U.S. Green Building Council (USGBC) allows a project team to track sustainability throughout design and construction. The recently released Version 2.1 makes it easier for the team to tabulate the green results and qualify the project for certification.

There are very helpful design guidelines in the group’s “reference package” that allow for the efficient design of cost-effective green strategies. When followed, LEED will achieve the predictable result of a quality sustainable building.

Other owners may opt for a less formal approach, which can also achieve a very high quality green building. The key to success is to retain designers, consultants and a construction manager early on in the planning to develop a feasible, cost-effective, sustainable concept via an integrated design approach. An eco-charrette held during the conceptual stage of a project allows all stakeholders to brainstorm ideas that evolve into the ultimate design.

Having a financial representative involved will allow the message of life cycles and value analyses to be delivered to the ultimate decision makers. There is no reason that a well-conceived, well-designed green building project should not make good economic sense, when all subjective and objective factors are considered.

Toyota Makes Economic Sense

According to Bob Pitts, group vice president, administrative services, Toyota Motor Sales, USA, Inc., the project had to cost less than the average office space lease Toyota was already paying for rental space in Torrance.

For more information: U.S Green Building Council — Information and resources on sustainable design and construction. Turner Construction Company and project information. Real Esate Briefing: Developing Green. Articles profiling various projects with a “green theme” discuss the approach and tactics used in their development. To order call NAIOP’s Publications Department at (800) 666-6780.

Turner, along with LPA Architects, evaluated trade-offs such as a tilt-up concrete panel façade (in lieu of custom-designed curtainwall) that allowed for the first cost premium of rooftop photovoltaic panels. Long-term operating savings were also on Toyota’s radar screen when they approved the use of high efficiency air handling equipment and central gas-fired chillers that achieved energy savings well beyond California’s stringent Title 24 energy code. Through good planning, Turner was able to recycle 96 percent of the construction waste at an actual savings when compared with sending combined waste to local landfills.

Other green features include use of extensive daylighting, an average of 50 percent recycled content in overall building materials, including structural steel, drywall and ceiling tiles, refurbishable carpet (that will avoid landfills) and even chair webbing made of seat belt remnants.

And now for the really good news: core/shell construction cost $63 per square foot —vs. a local market range of $54 to $76 — and interior construction cost $26 per square foot —vs. $22 to $40 in other local buildings. Clearly, the Toyota South Campus project demonstrates that a quality green office complex can be built at a competitive first cost and, in addition, reap the future benefits of energy savings and a high quality of life.

10 Studied Advantages Recently, the U.S. Green Building Council (USGBC) published a synopsis of a roundtable forum that was convened at the request of the Environment and Public Works Committee of the U.S. Senate. Entitled “Making The Business Case For High Performance Buildings,” the publication outlined 10 advantages of a sustainably designed building: Higher up-front costs (if any) for high performance green buildings can be recovered. Integrated design lowers ongoing operating costs. Better buildings equate to higher employee productivity. New technologies enhance occupant health and well-being. Healthier buildings can reduce liability. Tenants’ costs can be significantly reduced. Property value will increase. Many financial incentive programs are available. Communities will notice a developer’s efforts. Using best practices yields more predictable results. Some of these advantages are measurable, and others, while somewhat intangible, are gaining credibility in the industry. For example, studies have been conducted that have measured increased worker productivity of up to 26 percent in buildings with high indoor environmental quality. Retail sales have been shown to increase by up to 40 percent when natural daylight is brought into sales areas.

Rod F. Wille is a senior vice president at Turner Construction Company, a leading general builder.
He is a LEED Accredited Professional.