By Silvio Marcacci
2 July 2013 — From CleanTechnica: Green building hasn’t always been a good investment for the retail and hospitality markets, but growing consumer demand and economic benefits have changed the equation – more than half of all new US projects will be “green” by 2015.
Tremendous green growth has occurred in these building sectors, roughly doubling from 2011 to 2013, according to McGraw Hill Construction’s Green Retail and Hospitality SmartMarket Report.
Green projects were defined as those built for high resource efficiency, LEED certification or other nationally recognized green building standards.
Even though inherent difficulties exist for these markets to go green, especially when compared to the booming residential green building sector, rising asset values and increased consumer demand for green goods are combining with decreased operating costs to make sustainable design and construction the new norm.
More Than Half Green Buildings By 2015
The growth of green building has been nothing short of spectacular over the past two years. The percentage of retail/restaurant owners reporting more than half their buildings as green jumped from 18 per cent in 2011 to 38 per cent in 2013, and should hit 52 per cent by 2015. In addition, the percentage of hotel owners reporting more than half their facilities as green rose from 28 per cent in 2011 to 48 per cent in 2013, expected to reach 62 per cent by 2015.
While these increases are remarkable, they look even better considering why retail shops, restaurants, and hotels have lagged behind other building markets in going green. Unlike the predictable occupants and needs of schools and offices, the retail and hospitality markets must deal with higher HVAC requirements, transient occupants, long hours of operation and franchise ownership models.
Green Investments Equal Green ROI
Similar to the way rooftop solar boosts home values and resale, green building features are generating serious financial benefits. Asset values increase seven per cent for retail locations, 12 per cent for restaurants, and 11 per cent for hotels. Building return on investment jumps eight per cent for retail locations, 12 per cent for restaurants, and 14 per cent for hotels. Interestingly, annual operating costs dropped eight per cent for retail and four per cent for hotels, but increased for restaurants.
Energy efficiency was the largest driver of economic benefits for both markets. Fifty-eight per cent of retail/restaurant owners and 67 per cent of hotel owners reported lower energy use in their green buildings compared with non-green buildings, with both sectors enjoying a 15 per cent average decrease in energy consumption.
Customer And Employee Satisfaction Also Rise
Intangible returns, while not as easy to quantify but no less important, also keep piling up for business owners. Forty-six per cent of hotels that went green reported higher occupancy rates with 69 per cent seeing increased customer satisfaction.
In addition, 55 per cent of hotel owners and 50 per cent of retail owners saw an increase in sales velocity, while 69 per cent of hotel owners and 45 per cent of retail owners reported higher customer satisfaction. All of these results track with the 75 per cent increase in US green business sales from 2008-2011.
But perhaps more important for these customer service-focused industries, green buildings resulted in happier employees. 62 per cent of retail owners, 83 per cent of hotel owners, and 85 per cent of restaurant owners said green building activities had a positive impact on worker wellbeing and health. After all, who wants to call out of their shift when they get to work in a naturally lit, efficient and healthy space?
Significant Obstacles, Significant Opportunities
Even though the economic and reputational benefits of green building are clear for a majority of retail and hotel owners, significant obstacles remain for the industry. Nearly half of building owners in both sectors said perceived higher up-front capital costs prevented sustainability projects from moving forward, and more than a third reported greenwashing concerns about their projects could limit green activities.
This article first appeared on CleanTechnica