Every high performance green building is a great idea. Each project saves energy, conserves water, manages waste, promotes occupant comfort, and provides many other benefits for people and the environment. The green building movement has created thousands of such better buildings, and the value of these properties has been repeatedly recognized with superior economic performance—lower vacancy rates, faster to lease, higher effective rents, and increased operating income.

This track record of success has now changed the question that businesses are asking related to green high performance buildings, and more recently, the burgeoning market for ultra-efficient net zero energy buildings: What do the benefits and value provided by these buildings look like at scale? We know that we can create one great project and that great projects represent buildings that are better for people and the environment. The challenge before us is to take this experience and create value by embracing and integrating these ideas as core business strategies. This means moving the frontlines of the fight for better buildings from individual projects—the site of so many tactical victories—to entire portfolios held by real estate companies and funds. This change in focus will accelerate and deepen the impact of the green building movement, taking us from a few marquee projects to ubiquitous market transformation.

What does it look like when high performance building is integrated with business strategy? Let’s take a look at the case of a global leader recognized in the annual GRESB assessment. GRESB is a platform to assess, score, and benchmark the sustainability performance of property companies and funds around the world. In 2015, GRESB covered a broad cross-section of the investor-owned real estate universe, including 707 companies and funds with an aggregate asset value of $2.3 trillion. The assessment is the global benchmark for environmental, social, and governance (ESG) performance of real estate companies and funds. GRESB is not a certification; rather, GRESB’s ESG data provides actionable transparency for investors.

In the case of LendLease, a perennial sector-leading property developer and operator, the company engaged a decade ago in demonstration projects to sketch out a practical roadmap to “zero net” performance, such as its early demonstration project providing “zero net” carbon, waste, and water performance for military housing at Ft. Campbell, Kentucky. Today, LendLease has institutionalized this experience in a commitment to address “strategic challenges” including climate change impacts and resource scarcity through strategies for energy, water, waste, and supply chain management. This is reflected in exceptional performance goals for projects such as Bangaroo South in Sydney, a 7.5-hectare urban regeneration site targeting carbon neutral operations. The key is in integration. Bangaroo South is not a one-off project. Instead, it reflects a long-term commitment to gaining practical experience and institutionalizing high performance building goals. Importantly, with this kind of track record, it would be unthinkable for the next project to set lower standards. This creates an internal ratchet that incrementally drives expectations toward higher performance and integrates sustainability more deeply into the organization’s core value proposition.

LendLease’s experience is not unique. GRESB recognizes a cadre of comparable sector-leaders around the world, such as Kilroy Realty, Host Hotels, and UBS Real Estate. These leaders set the industry standard and clearly demonstrate the potential for high performance, even a practical pathway to net zero. However, it is essential to recognize that these leaders are not the norm. Our wealth of project-level experience is not raising all boats equally. Results from the annual GRESB assessment show that the majority of participating companies and funds have room for improvement and many are just starting out. In the vast majority of cases, real estate companies and funds could be doing more to reap the benefits of project-level experience with organizational strategies that institutionalize approaches to creating value from superior projects. Project experience tells us how. Our business strategy will take these lessons to scale and create real business value.

Dr. Chris Pyke is the Chief Operating Officer for GRESB, an industry-driven organization committed to assessing the ESG performance of real assets around the world. He also directs the Green Building Information Gateway (www.gbig.org), a global platform providing information about green building activity and serves on the United Nation’s Intergovernmental Panel on Climate Change.

Want to learn more? Meet Chris Pyke at the New Buildings Institute Getting to Zero Summit in Denver, Colorado on October 12-14, 2016 where he’ll talk more about how industry leaders are turning project experience into integrated business strategy.

Connect with Dr. Chris Pyke: LinkedIn

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