What Commercial Real Estate Executives Think and Do About Energy Efficiency

The 2014 Northwest Commercial Building Stock Assessment estimates the size of the Commercial Real Estate (CRE) market in the Northwest to be 1.6 billion square feet–a market of existing buildings that are prime candidates for energy and carbon reductions through energy efficiency best practices. Best practices broadly include behaviors and tools that support effective implementation of energy management. These practices increase energy performance over time in buildings, portfolios and organizations. NBI recently completed a research project and report (Commercial Real Estate (CRE) Market Test Assessment: Understanding Delivery, Partnership Strategies and Program Channels) for the Northwest Energy Efficiency Alliance (NEEA) that provided insights on the delivery, partnership strategies and program channels for increasing the adoption of energy efficiency best practices among executive-level decision makers in the Northwest. The results were derived through interviews with CRE executives and representatives from a variety of related trade organizations. The consistent findings spotlight how the CRE market operates and some of the barriers to adoption of energy efficiency best practices, which are captured in six themes:

  1. The market is awash with information on energy efficiency which frequently results in confusion and inaction for CRE teams as they don’t have the time or resources to resolve information gaps and conflicts.
  2. Decisions about energy efficiency investments are a team effort that can involve a messy matrix of inputs and decisions from several organizational levels.
  3. Firms rarely have energy efficiency platforms and/or plans despite the fact that a number of firms claimed to have benchmarked their properties.
  4. There is a need for “actionable insight” from trainings and certifications. Information and trainings on technologies and strategies that does not include cost information and return on investment is quickly dismissed.
  5. Firms approach energy efficiency differently. The primary drivers for investing in energy efficiency vary based on business structure and market position.
  6. There is strong interest in public/private collaboration efforts such as the Seattle 2030 District which was cited as being an intriguing opportunity for engaging the CRE market around managing and reducing energy in a group of buildings.

Having recently relocated its office to downtown Portland, NBI is well positioned to engage and assist the local and regional CRE market by actively engaging the various stakeholders to address some of these barriers. Thus far we have engaged the city of Portland on its recently approved Energy Performance Reporting Policy, are working with NEEA to address the work performing building in the Northwest through the Community Building Renewal pilot and will continue to convene local stakeholders in an effort to dramatically reduce energy use in commercial buildings.