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IMT and DOE Reveal 2018 Green Lease Leaders
The Institute for Market Transformation (IMT) and the U.S. Department of Energy’s (DOE) Better Buildings Alliance announced the 2018 Green Lease Leaders at the BOMA International Conference & Expo in San Antonio, Tx., a conference which brings together thousands of commercial real estate professionals every year and covers the latest industry trends, building innovations, and operational best practices. Green Lease Leaders recognizes leading-edge companies and real estate practitioners who break down barriers to high-performance buildings by revolutionizing leases to include energy efficiency and sustainability. This year, Green Lease Leaders represented portfolios totaling 717 million square feet (sq ft.), bringing the cumulative floor area of all Green Lease Leaders to more than 1.8 billion sq ft.
To achieve major reductions in building energy usage requires better collaboration between landlords and tenants. With this in mind, Green Lease Leaders, now in its fifth year, continues to elevate industry standards and visibility for real estate leaders who are implementing green, also known as high-performance or energy-aligned leases. Working across a diversity of real estate owners, tenants, brokers, and other stakeholders, green leasing sets terms up-front, and provides a framework for landlords and tenants to ensure building efficiency practices and investments are mutually beneficial and properly executed—helping move past historical road blocks to better building performance and return on investment caused by most standard lease structures.
IMT estimates that green leases can help reduce utility bills by up to $0.51 per square foot (11-22 percent) in U.S. office buildings alone, and if all leased office buildings executed green leases, the market could save over $3 billion in annual cost savings. Lease clauses that 2018’s Green Lease Leaders have implemented address a range of important issues such as energy and water efficiency, health & wellness, employee engagement, indoor air quality, data center efficiency, and zero net energy buildings. Restrictions on HVAC hours, required plug load management, submetering utility data, and periodic retro-commissioning to optimize operations and equipment are just a few of the terms that are currently being fulfilled.
“With leased space representing more than half commercial building energy usage in the U.S., DOE and IMT are working side-by-side with real estate industry leaders on ways to bring building energy efficiency and affordability in leased spaces forward,” said Kathleen Hogan, Deputy Assistant Secretary for Energy Efficiency at DOE. “This year’s Green Lease Leaders demonstrate that by using mutually beneficial lease language to collaboratively address building performance, landlords and tenants are achieving higher energy savings and improving tenant satisfaction.”
“As building owners, developers, tenant companies, and other real estate decision makers strive to keep up with evolving market pressures, leading-edge companies are using the lease as a powerful instrument to create higher-performing buildings that not only save energy and money but also provide healthier work environments,” said Cliff Majersik, Executive Director for IMT. “IMT and DOE’s Green Lease Leaders program has made a significant impact over the past five years by setting the bar for green lease agreements and putting a much needed spotlight on the growing number of innovative firms that use their lease to achieve ambitious energy, sustainability, and business goals. We are thrilled to recognize this year’s impressive recipients who are pushing the envelope on building performance and energy-aligned leasing.”
“BOMA International is pleased to have once again hosted this year’s Green Lease Leaders awards ceremony,” said BOMA International Chair Rob Brierley, BOMA Fellow, managing director of Real Estate Management Services and executive vice president of Colliers Boston. “As a long-time supporter of green leasing in the commercial real estate industry, BOMA offers resources, including its recently updated Green Lease Guide, to help property professionals work together with tenants to achieve sustainable, high-performing properties. The 2018 Green Lease Leaders demonstrate the value of these efforts, and BOMA congratulates them on their achievements.”
The 2018 Green Lease Leaders are:
Landlord – Gold Recognition
- Brixmor Property Group
- CommonWealth Partners
- Digital Realty
- Federal Realty Investment Trust
- Forest City
- Ivanhoe Cambridge
- JBG Smith
- Kilroy Realty Corporation
- Kimco Realty
- The Tower Companies
Tenant – Gold Recognition
- TD Bank
Landlord – Silver Recognition
- Manulife | John Hancock
- The Natural Resources Defense Council (NRDC)
- Weingarten Realty
Tenant – Silver Recognition
- Ulta Beauty
Team Transaction Recognition
- Rocky Mountain Institute, with Morgan Creek Ventures, Packard Dierking Attorneys at Law, Holland & Hart, and Coburn.
New Levels of Recognition in 2018
New this year, Green Lease Leaders recognized two levels of achievement—Silver and Gold. Silver recognition applauds the establishment of foundational policies and business practices that encourage reduced energy and water consumption in leased spaces. Gold recognition builds on Silver-level achievements and requires execution of leases and energy-efficient tenant fit-outs that are verified with an executed lease and other documentation.Commercial, industrial, and retail landlords and tenants, as well as transaction teams (a combination of landlord, tenants or brokers for a single real estate deal) are also eligible for recognition.
How to Receive Green Lease Leaders Recognition
To receive Green Lease Leaders recognition, organizations must meet two prerequisites and earn five or more credits for best practices such as utility data tracking and sharing, cost recovery for efficiency-related capital improvements, sustainability training, and energy efficiency fit-out requirements for tenant spaces, among others. A new Innovation in Leasing credit encourages organizations test out new ideas and share them with the market. The application period to be recognized in 2019 is now open and will close next March. To receive one-on-one guidance for greening your lease and/or support for becoming a Green Lease Leader, contact IMT and DOE staff here.
In addition, the program now recognizes two levels of achievement—Silver and Gold. Silver recognition applauds the establishment of foundational policies and business practices that encourage reduced energy and water consumption in leased spaces. Gold recognition builds on Silver-level achievements and requires execution of leases and energy-efficient tenant fit-outs that are verified with an executed lease and other documentation. Participation in a case study is also required for Gold recognition. Commercial, industrial, and retail landlords and tenants, as well as transaction teams (a combination of landlord, tenants or brokers for a single real estate deal) are eligible for recognition. Designees must reapply once every three years to maintain their Green Lease Leader status.
What some of the 2018 Green Lease Leaders are saying:
“Tenants are typically responsible for nearly 70% of the total building energy consumption. Educating tenants is the first step towards addressing tenants’ large percentage of energy use and ensuring a mutually beneficial agreement that address split incentive dilemmas to advance our sustainability programs,” said Jessica Loeper, Director of Sustainability at CommonWealth Partners. “These sustainability goals we follow influence the properties’ capital and operating budgets and ultimately provide an overall efficient portfolio. That is why CommonWealth Partners is honored to achieve the 2018 Green Lease Leader award as recognized through the Institute for Market Transformation and the U.S. Department of Energy’s Better Buildings Alliance. Our Executive Team directs the establishment of sustainability goals, leads the efforts of our development and operations teams, and monitors the progress toward achievement of the goals set forward.”
“We are honored to be named a 2018 Green Lease Leader. Data centers are the indispensable backbone of our modern lives, and green leasing is an important tool in our toolkit supporting greater energy and water efficiency in our global portfolio,” said Aaron Binkley, Senior Director of Sustainability at Digital Realty. “Tailoring green lease standards to fit the unique needs of data centers is another way Digital Realty is unlocking sustainability value for our customers and our business.”
“Federal Realty is honored to be recognized as a 2018 Green Lease Leader. Our green leases are an essential component of our business operations and have helped us integrate our sustainability goals into the way we operate our properties, providing our tenants with additional opportunities to pursue their own environmental objectives.” said Ron Becker, CRX, CSM, Director of National Property Operations and Sustainability at Federal Realty. “Through this aligned partnership, we minimize our impact on the environment with initiatives like solar photovoltaics and water use reduction while generating operational cost savings that benefit both the landlord and tenant. Proudly, our sustainability commitment flows throughout our organization as we work side by side with our tenants to help realize their goals; the results are a triple win for our tenants, our customers and Federal Realty.”
“As a sustainability leader in the real estate industry, Forest City uses green leases as part of our holistic approach to managing environmental, social and governance issues and as a tool to achieve our forward-thinking objectives, including our greenhouse gas reduction goals, which were recently approved by the Science Based Targets initiative,” said Jill Ziegler, Director of Sustainability and Corporate Responsibility at Forest City. “Green leases help drive efficiency throughout our properties and foster strong relationships with our tenants, empowering us to create placemaking real estate where people, businesses, and communities thrive.”
“We are excited to have earned a second Green Lease Leader designation. With green lease provisions in place across our portfolio, we are seeing success in working with our tenant community to get projects implemented, operate buildings efficiently, and get the data we need to demonstrate performance to our stakeholders,” said Becca Rushin, Vice President, Sustainability and Corporate Social Responsibility at Jamestown.
“Green leasing is at the heart of our sustainability programs because it clearly aligns tenant and landlord sustainability goals and makes our environmental projects possible, everything from lighting retrofits to investor disclosures to recycling revitalization to LEED certifications,” said Sara Neff, Senior Vice President of Sustainability at Kilroy Realty Corporation. “We are honored to be recognized for our green leasing efforts by the Institute of Market Transformation and the Department of Energy’s Better Buildings Alliance, and believe that this recognition demonstrates to our industry that embracing green leasing is a clear best practice for landlords, tenants, and brokers alike.”
“LaSalle is pleased to be recognized as a 2018 Green Lease Leader, demonstrating our commitment to implementing ESG best practices in cooperation with our tenants,” said Eric Duchon, Director, Global Head of Sustainability at LaSalle Investment Management. “We look forward to continuing to implement green lease language as part of our standard lease form across all of our leasing activity in order to further improve the efficiency of the assets in our managed portfolio.”
“We are honored to be the first industrial real estate company to receive the Green Lease Leader recognition at the gold level,” said Jeannie Renne-Malone, Prologis’ Vice President of Sustainability. “As the global leader in logistics real estate, we recognize that solid, proven ESG practices are good business. Not only do our sustainability strategies benefit our customers, investors, communities and employees, they also advance our longstanding focus on exemplary customer service. This is evident in our green lease program, which engages customers in our environmental initiatives, and in the resilient and efficient buildings that enable them to operate cost effectively and without disruption.”
“Rocky Mountain Institute is honored to be recognized as a Green Lease Leader team along with Morgan Creek Ventures, Coburn, Holland & Hart, and Packard and Dierking. Our green lease aligns financial and sustainability goals so tenants and landlords both benefit from being a part of a net-zero energy building,” said Alisa Petersen, Senior Associate at Rocky Mountain Institute. “Since very few net-zero energy leases exist, creating this lease required trust and innovation among all parties involved, along with leaning heavily on green lease library resources. We hope this recognition can help other leased building owners see that net-zero energy leased buildings are not only achievable, but also compelling.”
“We are honored to be recognized by the Department of Energy and the Institute for Market Transformation as a Green Lease Leader again in 2018,” said Jeffrey Abramson, Partner at The Tower Companies. “Our green lease lays the foundation for a mutually beneficial tenant-landlord partnership on sustainability. Green leasing is the best tool to build efficient, healthy, productive, and appealing leased spaces and we are committed to this practice across our entire commercial portfolio.”
Become a Green Lease Leader in 2019
For more information on the Green Lease Leaders program, this year’s recipients, and how to apply to be recognized in 2019, visit greenleaseleaders.com. To learn more about the benefits of green leasing and landlord-tenant collaboration on sustainability, visit the Green Lease Library and stay tuned for upcoming Green Lease Leader case studies that will be released in August just ahead of the 2018 Better Buildings Summit and Building Energy Exchange.