You may have already heard how sustainable the Southern Nevada resort industry is with its many LEED certified buildings, extensive rooftop solar and comprehensive recycling and water conservation programs, but did you know that many large buildings (that are much less sexy) can be great opportunities for improving profitability and increasing valuations?
Large-footprint warehouses and distribution centers (‘DCs’ in the parlance of our day) are generally energy intensive and therefore well suited for energy retrofit projects. They are also operational for longer periods of time and have high lighting and ventilation demands. Two very good examples of warehouse/distribution centers that have undergone extensive energy retrofits (sometimes called, ‘deep energy’ retrofits) are the Levi’s Distribution Center in Henderson and the TJ Maxx Distribution Center in North Las Vegas. Both of these projects were primarily initiated as deep energy retrofits but eventually resulted in high level LEED certification and national media exposure as well. These companies further benefitted by reducing their state property tax burden by enrolling in the Nevada Governor’s Office of Energy’s Green Building Tax Abatement Program.
International companies typically place a higher value on sustainable development and Prologis has been a leader in the greening of the DC building stock globally. Publicly traded companies like Prologis understand that sustainable measures not only reduce operating costs but also attract and retain customers and enhance asset value. These efforts help increase occupancy, boost NOI and support higher valuations.
Many DCs have incorporated rooftop solar through Power Purchase Agreements (PPA’s or ‘solar leases’) but many opt for the simpler measures that save energy costs and improve worker productivity, such as skylights, LED lighting, low velocity fans, green cleaning, and improved fresh air ventilation. You can read more about the current trends nationally toward greening the industrial workplace here:
Next month: Commercial Rooftop Solar Alive and Well: Power Purchase Agreements for a Net Zero Future
Rick Van Diepen, AIA, LEED AP is a Principal at Greenview Global LLC and serves as co-chair of the NAIOP Sustainable Development Committee