September 23, 2016

Why You Need to Update Your Commercial Property for Energy Efficiency

Three Reasons You Should Consider Eco-Upgrades for Your Commercial Property

“In the future, every industry should be an environmental industry.”  It has been a decade since David Miliband, then UK Secretary of State for the Environment, Food, and Rural Affairs, shared his thoughts at an environmental industries conference, and in the years since then, companies around the world have embraced the concept of more sustainable operations. Bringing legacy commercial properties up-to-date with energy-efficient upgrades, however, can be a financial and logistical challenge. What makes it worth the effort?

Why You Need to Update Your Commercial Property for Energy Efficiency

You don’t have to be an eco-warrior to embrace the advantages that come from energy-efficiency improvements. Here are three reasons why.

  1. You could get 100 percent capital funding for energy efficiency upgrades—without writing a check—through the Property Assessed Clean Energy (PACE) Program. A national program launched in 2009, PACE encourages property owners to make energy efficiency upgrades (EEUs) for a wide range of property types. The State of Ohio adopted the program to enable Ohio municipalities and townships to help property owners with financing for solar, geothermal, wind, biomass, gasification and energy-efficiency projects—and Dayton is one such municipality to support the program. PACE financing allows property owners to borrow money for energy improvements, repaying it through a special assessment on the property over 10 to 20 years. Available across many sectors including Commercial, Industrial, Multi-Family Residential and others, PACE represents an affordable option for making a wide range of upgrades—such as updates to lighting, electrical systems, motors, mechanical systems or the building envelope—that might otherwise be moved to the back burner. In addition, installation of solar, wind, biomass, and geothermal energy generation systems are eligible for PACE financing. Dayton’s PACE Program allows property owners to take advantage of 100 percent fixed-rate financing for EEU projects of all sizes. Moreover, the debt requires no direct collateralization and the resulting tax lien/assessment carries with the property if sold. Still not convinced? Read on!
  1. EEU projects have a positive impact on your bottom line. According to the U.S Green Building Council, both new construction and existing building projects see financial advantages when they make the shift to energy efficiency. For instance, the Council notes that:
    • Operating costs decline between 8 to 14 percent following upgrades
    • Building values increased between 6 to 11 percent after EEU projects

The result?  Improved cash flow with the reduction of operating costs and higher asset valuations for both new green building projects and retrofits. What’s more, property owners realize an additional advantage as commercial and industrial spaces become more competitive in the marketplace, attracting more potential tenants and reducing churn of existing tenants.

  1. EEU projects help you meet green corporate initiatives. The U.S. Green Building Council also emphasizes that the value of EEUs extends beyond pure financial reasons. Research shows that 75 percent of companies believe sustainability aligns with their profit missions. Increasingly, green initiatives help companies meet consumer expectations for good eco-stewardship and build brand loyalty. Moreover, employees appreciate sustainable goals: A behavioral psychology study revealed that companies with higher environmental standards enjoy 16 percent higher productivity levels than non-green firms. And, of course, these benefits will positively impact your bottom line as well.

To learn more about how Miller-Valentine Group can assist you in taking advantage of PACE financing and meeting goals for energy-efficient operations, contact Dave Williams at 937.293.0900.

Dayton Arcade Project:
Special Financing May Become Part of Dayton Arcade Project

Links:
Every Industry Should Be An Environmental One
Miller-Valentine Group Commercial Services – Construction Expertise
Bond Program May Drive Big Ticket Upgrades