Commercial Green Building News and Analysis!

Commercial Green Building REITs: Who's Taking the Lead?

Question:


Which REITs are leading in green building?

Answer:


Liberty Property Trust is a public REIT (NYSE: LRE) that is also a leading developer of high-performance green office and industrial buildings. The company develops green office, industrial and warehouse facilities as well as retrofits existing buildings and has 36 LEED projects completed or under construction nationwide, more than any other commercial developer in the U.S.

Liberty's thoughtful rationale for developing green includes:

1. Sustainable design and LEED certification contributes to higher potential rents.
2. LEED certification may accelerate time to market and may expedite the permitting process.
3. Green features help attract investment capital.
4. Sustainable design may significantly increase property values.

Liberty predicts that the market will someday see a bifurcation of class A buildings, separating sustainable designs from those that are not and providing outsized rewards for green properties.

Liberty typically pays a premium of no more than four percent (4%) for incorporating sustainable features into its projects. The development cycle is no longer than usual and operating costs can be reduced 20 to 30 percent, equating to $0.50 to $1.00 savings per square foot passed through to tenants.

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