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Energy Efficiency in the Small Buildings CRE Market

Written by: Marta Schantz

Often times when it comes to energy efficiency in the commercial real estate world, small buildings are not provided with the resources they need. From our work throughout the market, Waypoint has found that there is a clear disparity of education and resources for small/medium size buildings in relation to larger (Class A) properties. This doesn’t mean it’s impossible to identify and execute energy efficiency opportunities in smaller spaces, just that their needs should be better understood, and that resources should be targeted to them appropriately. Waypoint has worked to better understand the needs of smaller/Class B spaces on behalf of many of its clients. A good example of this is our Western Commercial project:

Project description: Waypoint was engaged for a cross-utility project to assess and analyze energy efficiency potential in mid-size (200-499 kW) commercial buildings in the Northwest. Waypoint performed direct outreach to building owners and managers to assess physical building conditions and to identify the market barriers limiting the uptake of EE, and provided targeted information on individual, service territory and cross-utility territory buildings and recommended EE program improvements.

From Waypoint’s Western Commercial experience, a wide range of barriers were identified and trends developed. Overall, many of these fell under three primary factors that shape the small/Class B marketplace:

  • Time Constrained: Stakeholders managing and operating small buildings are often so consumed with day-to-day activities that they do not have the time to focus on energy efficiency opportunities

  • Staff Constrained: Staff working at small buildings wear multiple hats; rarely do they have dedicated 3rd party management and/or building engineering staff that can focus on energy efficiency efforts

  • Resource Constrained: Small buildings are not often able to benefit from economies of scale, nor do they start with large budgets/capital planning funds for large energy retrofits

As a result of these trends, Waypoint recommends an intensive approach to educating and empowering small businesses when it comes to energy efficiency programs. One example of this is highlighted by a Class B program Waypoint developed on behalf of the California Sustainability Alliance (CASA):

Program description: Waypoint developed and implemented a Green Portfolio Program to enhance sustainability market adoption within the Class B office market. Waypoint engaged and enrolled Class B commercial building owners in a whole building EE program, addressing capital, operational and tenant space efficiencies. We developed a sector-wide best practices toolkit to enable Class B commercial building owners to implement EE in their portfolios, and distributed program learnings and toolkit through channel partners to increase scale and impact of efficiency programs.

Based on our CASA experience, Waypoint found that most existing market tools are applicable to small buildings as-is, but may need some additional support via case studies, trainings, and finance support. By working 1-on-1 with these small building owners to help provide education and technical support, Waypoint has cracked the code for bringing EE to the SMB market.

  • Time Constrained: Build and highlight case studies of small buildings incorporating EE to show SMB stakeholders the feasibility of efficiency activities

  • Staff Constrained: Develop and educate trainings dedicated to small buildings, and streamline & promote existing Utility Programs that are tailored to Small Buildings

  • Resource Constrained: Explore pairing of utility and efficiency organization tools and resources with utility financial products or 3rd party financial product for small businesses

We look forward to continuing to work alongside SMB owners to make the case for energy efficiency.


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