When energy efficient design firm Ecotope outgrew their office space in the University District, they sought out a sustainable building on par with their goals and standards for energy technologies, at no surprise. What they found, however, was a landlord that wasn’t quite as forward thinking as they are, and brokers who offered little insight into the energy efficiency of available buildings in the downtown Seattle area.
Ecotope President Jonathan Heller spoke briefly at a Seattle 2030 District Engaging Tenants meeting at Pike Place Market on Wednesday, March 29th along with Micah Brill, vice president of Urban Land Institute’s Greenprint Center for Building Performance, Emily Pearce, director of utility solutions at the Waypoint Building Group, and Ruth Bell, co-president of Cascadia Consulting. Each speaker touched on the ways owners, managers and developers can engage their tenants to practice greener goals, emphasizing the importance tenants play in the overall reduction of energy and water usage for the building.
Heller, who recently moved the company’s offices to the Alaska Trade Building on First Ave., said finding the right space presented challenges. “We looked for a long time to find an office space because we had some maybe difficult requirements,” Heller said, including allowing everyone the ability to see an operable window, which he said was high on the list. He also said they had to be able to make it energy efficient, which was very difficult to accomplish.
In order to do so, Heller sought out brokers, which he didn’t name, for more information on the various buildings’ utility uses, but said it was essentially a dead end.
“None of the brokers we talked to could tell us what the energy usage of the buildings were that we were looking at, none of them,” Heller said. “Almost none of them even knew what I was talking about, even though Seattle requires them to disclose the energy index (EI) of the buildings,” he added.
Specifically, he was curious as to the state of the building’s heating, ventilation and air conditioning system (HVAC) in their space, which he eventually discovered. Heller said they eventually got the numbers after a while but nobody else was able to deliver what the EI for the buildings were. “Almost all the spaces we looked at had terrible HVAC systems, and the brokers were oblivious to it,” he said. “I’m obviously a lot more sensitive to that, I’m not going to move into a space with a giant entering air temperature (EAT) box rumbling overhead and tell people that I’m going to design a really great HVAC system for them,” he added. The brokers accepted what was in the space as ‘that’s just what you do,’ Heller said.
Given that the current system was 12 years old, he wanted to make an improvement, but the owner wasn’t on board to make those changes, so Heller offered to pay. While unable to convince the owner to replace the system throughout the building, he was able to switch out the old system for a newer, more sustainable one in their portion of the building, which cut their usage substantially.
“But it was very difficult to find an owner that we could talk into allowing us to replace the HVAC system, even though we were offering to fund it,” Heller said. He said the problem is finding an owner that understands that a system may not be broken right now, but over the course of time it will need to be replaced; and there’s value in highly efficient systems. “He didn’t believe us, ‘this thing is only 12 years old, and it’s not broken, why would I do anything different?’” Heller said.
“The good news is, there’s a lot of opportunity for this, but Seattle has a long ways to go,” Heller said.
Although sustainability matters to a wide variety of investors including private equity firms, developers, REITs, and real estate companies, a national CBRE Americas Investor Intentions Survey 2017 found that there’s a marginal shift toward it being less important to them. In the survey, nine percent of those surveyed said they feel that sustainability represents an important part of the investment process and six percent won’t even consider a building that doesn’t meet green criteria. A little more than half of investors, 51 percent, do consider sustainability in their assets but only to a degree. But a substantial portion of investors, 34 percent, said sustainability isn’t important. According to the report, “This was an increase from 31 percent in last year’s survey, suggesting that sustainability issues are becoming somewhat less important.”