The Business Impact of Investing in a Green Office Property

The residential real estate market has seen an increase in the amount of “green houses” over the past

decade. Sustainable practices were important to homeowners that wanted to choose a green lifestyle and now the business world is catching up. The amount of green office buildings around the country is on the rise as entrepreneurs are realizing the benefits that a green building has on their business and employees.

If you are ready to make the move with your company here are some things to keep in mind.

Best Amenities for Green Offices

Air – When looking for a green office remember both the quality of air and the air temperature will have an impact on the space. Employees are healthier and able to focus better in buildings that contain less carbon dioxide and VOCs. In fact one study found that when the air quality in an office was improved the company saw a 10% increase in productivity. Statistics have also shown that office buildings with higher air quality experienced a 35% reduction in employee sick leave.

Location – A green and sustainable office can be located anywhere, however there are a few factors that you should consider. Look at the buildings that are surrounding the office building. Avoid buildings that are surrounded by manufacturing plants that are putting pollutants into the air. Buildings that are easy to reach will improve the commute for employees helping them to come into work in a better state of mind. It will also eliminate the amount of time they spend stuck in traffic surrounded by car exhaust.

Windows – The majority of employees do not enjoy working in offices with cubicle farms and studies have found that it can actually reduce productivity and health benefits for employees. Seeing sunshine and natural lighting improves employee morale and helps them come to work more rested. The Journal of Clinical Sleep Medicine conducted a study in 2014 where they found that workers slept 46 minutes longer when they were exposed to natural light. Employees that sleep better are able to be more productive during their work day. Look for office spaces that allow the most amount of employees to sit with natural light while they work.

Space – Open layout designs have become a popular trend in the workplace. While this layout does help to reduce the amount of building materials needed, thus lowering the carbon footprint of the company, it can have negative impacts on productivity. When choosing a layout for your office space consider which departments would benefit from working in closed quarters. Some jobs need to have more division of space. However, there are other jobs, such as graphic designers, that typically benefit from working collaboratively in an open work space.

Choosing an Office

Look for LEED Certification

When looking for a sustainable office space LEED Certified spaces come out on top. Certified buildings can be more expensive to rent, purchase, or build, but companies more than come out ahead with a great return on investment.

LEED certified spaces offer the following benefits for businesses:

  • Charge More for Rent – Owners of certified buildings are able to charge more for office space.
  • Lower Operating Costs – Buildings that become certified experience an average decrease in operating costs of 25%. A 2012 study found that green facilities lowered their annual utilities cost per employee by $675.26.
  • Attract More Renters – The higher prices do not negatively impact their vacancy rates, which equals a greater ROI when compared to traditional buildings.

The demand for green buildings is on the rise. The millennial generation is more aware of green practices than previous generations. As they continue to move into the business world the demand for green offices will continue to rise which will drive up the value of these buildings.

Considerations to Make Before Choosing a Space

Looking for a green office space isn’t always as easy as it seems. There are many considerations that a company needs to make before signing a lease or purchasing a building. Startup companies or those that have not been operating for many years can be at more of a disadvantage when choosing a space. It is crucial to consider how the office space you are looking at will play into your long-term business plan. Choosing a small space today when you plan to quickly grow your staff over the next two years may not be the wisest decision for your business. Think through the following:

  • How does this space work with the timeline for my business growth and long-term business goals?
  • Would a building with shared common spaces accommodate the business?
  • Do the amenities match what the company needs? Are the bathrooms sufficient? Is there ample parking? Will the technology available meet the needs of the company?
  • Does the space checkoff all of the boxes on the “need to have” list and does it meet any of the bonus items?
  • How much will the utilities cost?
  • How much will it cost to furnish the building?

Choosing an office space is never easy. Choosing a sustainable office space is even harder. However, companies benefit in many ways by choosing a green office. There employees are healthier and more productive, operating costs are lower, and they see a good return on their investment when selling or leasing the space. However, the main goal when choosing a green office space is to ensure it meets current and future needs of the company.

Guest article written by: Sacha Ferrandi is the Founder and Principal at Source Capital Funding Inc. As an expert in commercial and residential real estate with over 12 years of experience in the industry, Sacha works with business properties of all varieties. Since then inception of his company, Source Capital, he has been responsible for overseeing the entire firm’s operations including the funding of hundreds of millions of dollars in private loans.

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