Special Report: 6.18.2009

Posted by TED Magazine on Thursday, June 18, 2009

Green Owners Speak to Distributors

By Joe Salimando

Last week, a report on a NAED Leadership Summit panel covered what four electrical manufacturers said about green building, cost premiums for LEED, banning Styrofoam, and more.

What follows is a report on another panel—a first-class group of real estate owners/managers talking about green building experiences.

Panelists and Their Companies

Remember, these are notes from what I heard. My hearing is far from perfect (I blame my years commuting to Brooklyn Technical High School on the BMT subway line). This article, like the one last week, won’t do the panel justice.

Note: The moderator, again, was Jerry Yudelson (a green buildings expert working with NAED).

Participants on panel No. 2 were:

1. Jack Heineman, Southeast regional manager for Regency Centers
2. John Lawson, of the facility group at the U. of Florida
3. Clayton Ulrich, a senior veep (33 years!) with Hines Management
4. Warren Whitehead of CB Richard Ellis (I didn’t get his precise title)

I’ve included links so you can see what these companies do. You may already know that CBRE is a gigantic, stupendo-sized megacompany; at an event a few months ago, I’m pretty sure I heard another company speaker say CBRE was pursuing green certifications for 300-odd of the 1,100 buildings it manages.

See also: www.greencbre.com.

If you follow green stuff, you know that Regency Centers is on the cutting edge (see this release). And the University of Florida is no small-time organization, either.

Having said that, it was Ulrich (from a company of which I’d not previously heard) who impressed me the most.

Herewith, briefs on what they said in order of their appearance:

Regency’s Heineman

Among other things, the company:
(a) has a vice president of sustainability
(b) is making sure that an increasing percentage of its new developments are LEED-registered
(c) thinks it can get to 60% green buildings (new, I think) in 2010

Now this isn’t all that easy for Regency, because “we don’t get the benefits of the savings” (reduced energy bills, for example), Heineman said. “Our tenants get it. We only get the benefits in common areas and parking lot lighting.”

So why get so heavily into green building? It’s about building the Regency brand. “We are doing this not only for sustainability, for the long-term quality of these buildings,” he said. “We are owners for the long haul.”

Obviously aware of who was in his audience, Heineman also noted: “We don’t direct-purchase. But we are interested in [doing some national accounts purchasing].”

[Note: Please don’t confuse this Heineman with a panelist at a previous NAED event, contractor Rob Heineman of New Mexico’s Pueblo Electric. Aside from being a great panelist as well, Rob is (now) a former president of IEC.]

Ulrich of Hines

Everyone likes to present his/her company as different (everyone has a USP, right?). But Hines has an edge on green: The real estate firm was founded by a mechanical engineer. Apparently, this fellow (the founder) still shows up for work today. So you have here a real estate company with its heart in the mechanical contracting business!

Advantages for such a company in the green environment are many. For example, Hines had little trouble putting together a 16-member sustainability task force.

[For a peek at what the mechanical contractors are doing on green/sustainability, you need to devote some time to looking at www.greencontractors.us.]

“Our base spec will meet LEED Gold,” Ulrich said (a pretty remarkable simple sentence). “We didn’t change much to get there.

“We didn’t have to—we’re relying on 50-plus years of experience.”

Hines has 120 million square feet under management, as well as 10 buildings in Moscow. The company is diversified: Ulrich claimed it ranges from two-story buildings to the GM headquarters in Detroit (5 million square feet all by itself).

Interesting quotes from Ulrich (these are not in sequence):

1. “It’s more about efficiency than anything else…most buildings don’t really have lighting controls.” He made this statement in 2009, folks.
   
   
2. “We want to be as efficient and sustainable as we can be. But we’re in business to make money.”
   
   
3. “There’s a whole lot more opportunity in the existing buildings than in the new buildings. One of your challenges is that the [national building] portfolio has a huge diversity [of building types and situations].
   
   
4. “Some [people] who run buildings never see an electrical bill.”
   
   
5. Energy efficiency, he said, “is a perpetual business. They’ll do it [make the building more efficient, over time] again and again.”
   
   
6. On developing expertise on lighting: “It’s easier for us to pay you than it is to find and hire someone who does what you do.”
   
   
7. “You all [i.e., electrical distributors] have a chance to be heroes. [Think about the building owner’s] electricity bill—has it gone up? Take green and sustainability out [of the equation]. Everybody is feeling pressure [in today’s economic environment] to cut operating expenses.”

The University’s Lawson

The University of Florida has a sustainability director and, like a lot of colleges and universities, it is pursuing green angles. “Our goal is, at some point in time, to be carbon-neutral,” said Lawson, who works in the energy department.

One early effort at the school has been to look at existing buildings and go after low-hanging fruit. This is a one-at-a-time effort, Lawson explained, with “200 to 300” buildings on a campus that includes 20 million square feet under roof.

What have they found so far? Simple stuff that works. Examples he provided:

1. “We’ve found motors misaligned.”
   
   
2. “We’ve done simple things like better scheduling for a given building—scheduling for better efficiency.”

Asked (by Yudelson) about lighting, his reply was: “We rely a lot on our distributors to keep us abreast of what’s happening.”

Asked (by me, from the audience) if the school motivates students to keep energy use down, Lawson said it did.

Why I asked that question: At an event several months ago, I heard an Emory University executive (in charge of facilities) talk about how they motivated the students to reduce energy use. The school makes the kids aware of how much energy they are using (how fast the electric meter is spinning)—and uses that information in a competition.

Bottom line: The dorm that uses the least energy in a specific time period (a quarter, I think) gets a free pizza party. This has worked, the Emory exec said.

Think about that: For the price of a few pizzas, Emory gets its students to study (and do other things, one imagines) in the dark!

Whitehead Of CBRE

CBRE has 2,000 building engineers (that’s what is in my notes). Whitehead works in technical services and the focus right now, he said, is on “investing a lot in people” and finding “ways to stop using energy.”

On the people front, CBRE is putting all of its property managers and building engineers through the BEEP (BOMA’s Energy Efficiency Program).

How do you stop using energy? Like Lawson, Whitehead emphasized that simple ideas can suffice, at least at the start. “We have no-cost/low-cost checklists,” he explained. “These consist of 50 to 60 questions that take you through simple improvements you can make to reduce a building’s energy use.”

Interestingly, Whitehead had some advice for his audience, as well. How do you get your energy-efficiency product into a building managed by CBRE? “You had better be able to invest in a trial in one of our properties,” he said.

Summing it All Up

Combining what’s above with what appeared last week, you may have read 2,500-plus words here about the “green” tint to the NAED Leadership Summit. But there was actually a lot more. Solar vendors were invited—and showed up. There was an earlier panel on sustainability issues that I didn’t get to.

Is NAED “turning green” in some way? I don’t think that’s fair. There were many sessions on important distributor issues, such as one I attended featuring Joe Sullivan and a partner talking about practical stuff you can do about cash flow.

However, what should be obvious is that green isn’t going away. We’re going through an economic decline (some call it a recession, some The Great Recession, and I still suspect it’s a depression). Despite the slump, green is still here. Looking at business opportunities against the possibility that I am right (and worse economic news remains out there, waiting for us)…turning your attention to green seems like a sound business decision.

	Joe Salimando of EFJ Enterprises is a consultant, web content provider, and wordsmith based in Oakton, Va. To contact him, call 703-255-1428. See also The EleBlog.
Personal Disclaimer: The appearance of the ambling pachyderm is indicative of the writer’s obsession with elephants, not his political leanings.
IMPORTANT NOTE: THIS COLUMN REFLECTS ONLY THE OPINIONS OF ITS AUTHOR AND DOES NOT REFLECT THE OPINIONS OR POLICIES OF NAED, TED MAGAZINE, OR THE ADVERTISERS ON THE TEDMAG WEB SITE.