Written by: Fiona Dearth
At Waypoint Energy, a new year means new opportunities to continue to drive energy efficiency in commercial buildings. With 2016 in full swing, the opportunity for property owners and tenants alike to maximize the value and energy performance of their buildings has never been greater. Waypoint is collaborating with the Northwest Energy Efficiency Alliance (NEEA) to drive market adoption of building renewal— a real estate strategy to modernize a building and improve its competitive position by focusing on comprehensive energy efficiency upgrades —in Pacific Northwest markets. By helping to develop actionable building renewal resources and tools that are tailored to design teams and property management alike, Waypoint is leading commercial real estate (CRE) market transformation that will accelerate energy efficiency improvements in 2016 and beyond.
Building renewal is a real estate strategy for building modernization that significantly improves a building’s energy performance, revitalizes its market position, and increases asset value. Unlike a typical energy efficiency project that is assessed and implemented in discrete measures, a building renewal project is designed to identify “synergies” between individual projects that, when implemented together, allow for greater energy savings than would otherwise be possible. Known as deep energy retrofits, these integrated building renewal projects can reduce energy consumption by 35 percent or more compared to existing energy use.
NEEA’s interactive Spark Tool provides users with a quick and easy way to explore a specific commercial property’s potential for building renewal by identifying efficiency improvements and estimating project costs, energy savings, and increased real estate value. Spark lays out a customizable roadmap of measures and advice for future improvements in a report tailored to a specific property, as well as descriptions of building renewal best practices to ensure that building renewal projects are implemented effectively and perform as expected.
Energy savings translate to cost savings, and just as building renewal minimizes environmental impact, it can also reduce a building’s operating costs. However, a simple payback financial model does not always capture the full value these projects can bring to buildings and some qualitative benefits of building renewal defy easy quantifiable metrics. For instance, sustainable spaces that are redesigned to maximize tenant comfort can boost office productivity. Property managers and building owners benefit as well; higher rents for desirable space allows them to gain or maintain a competitive advantage in the market.
Just as no two buildings are entirely alike, there is no universal package of energy efficiency measures that will be equally successful at all properties. In partnership with NEEA, Waypoint is providing consulting support to help project champions in the Pacific Northwest to craft their business case for building renewal projects. By integrating the investment considerations of a project, such as the potentials risk and rate of return, alongside the technical aspects, such as the energy savings potential of a given efficiency measure, Waypoint is helping decision makers to successfully plan and implement building renewal.
In working with owners to identify building renewal opportunities and begin building the business case for deep energy retrofit projects, NEEA and Waypoint have found that:
Achieving significant energy savings is possible and has been demonstrated, but energy cost savings alone are not a strong enough motivation to owners;
An expanded business case that incorporates key real estate drivers is convincing to owners;
Owner motivations are varied, but there are common triggers for undertaking a deep energy retrofit; and
Owners are most likely to phase implementation of the integrated measure scope over multiple years; therefore, building renewal provides an “investment roadmap” for deep energy efficiency.
To learn more, browse owner case studies and building renewal resources available through the BetterBricks Resource Center. Assess whether your building is a good candidate for Spark in a few minutes by completing the QuickScreen questionnaire.