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Green Building Facts

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MARKET IMPACT

This year it is estimated that 40-48% of new nonresidential construction will be green, equating to a $120-145 billion opportunity1

62% of firms building new single-family homes report that they are doing more than 15% of their projects green. By 2018, that percentage increases to 84%.2

Historical averages have pegged the economic impact of investments in the U.S. residential market at roughly 5% of GDP, while other economic activity surrounding housing services as a whole have held historically averages fluctuating between 12% to 13% of GDP.3 This means that the current surge in green building starts and investment in the residential market will have an outsized impact on an estimated 17% to 18% of the domestic economy over the next decade.

More than 3.6 billion square feet of building space are LEED-certified (as of January, 2015)

41% of all nonresidential building starts in 2012 were green, as compared to 2% of all nonresidential building starts in 2005.4

Areas with the greatest per capita investment in green buildings in the U.S. for 2014 were:

  • District of Columbia
  • Washington, D.C.
  • Illinois
  • Colorado
  • Maryland
  • Virginia
  • Massachusetts
  • Hawa'ii
  • California
  • Georgia
  • Minnesota
  • Arizona
  • New York
  • LEED is referenced in project specifications for 71% of projects valued at $50 million and over5

    675.9 million square feet of real estate space became LEED certified in 2014, the largest area ever to become LEED certified in a single calendar year, and a 13.2% increase in total certified square-footage from 2013.

    Achieving LEED certification is a top sustainable goal for both private and public organizations, with LEED Gold certification being set as the goal for a majority of the organizations6

    INTERNATIONAL

    LEED is the most popular and widely used green building rating system globally. There are currently more than 69,000 LEED building projects located in over 150 countries and territories (as of January 2015).

    As of January 2015, approximately 44% of all square footage pursuing LEED certification existed outside the U.S.

    Project expectations in four countries in 20157:

  • Brazil - 83% of firms planning new green commercial projects
  • Singapore - 69% of firms planning green renovation projects
  • United Arab Emirates - 73% of firms planning green institutional projects
  • United Kingdom - 65% of firms planning green renovation projects
  • ENERGY

    By sector8:

  • Buildings: 41%
  • Industrial: 30%
  • Transportation: 29%
  • Buildings are one of the heaviest consumers of natural resources and account for a significant portion of the greenhouse gas emissions that affect climate change. In the U.S., buildings account for:

  • 38% of all CO2 emissions9
  • 73% of electricity consumption10
  • Green buildings consume less energy. Compared to the average commercial building, the LEED Gold buildings in the General Services Administration’s portfolio generally11:

  • Consume 25% less energy and 11% less water
  • Have 19% lower maintenance costs
  • 27% higher occupant satisfaction
  • 34% lower greenhouse gas emissions
  • LEED buildings avoided 0.35% of total U.S. CO2 emissions in 2011. The percentage of CO2 avoidance attributed to LEED buildings is estimated to be 4.92% in 2030.12

    WATER

    Buildings use 13.6% of all potable water, or 15 trillion gallons per year16.

    The industry expects that water-efficiency efforts will:

  • Decrease energy use by 10-11%
  • Save 11-12% of operating costs
  • Reduce water use by 15%14
  • Retrofitting 1 out of 100 American homes with water-efficient fixtures could avoid approximately 80,000 tons of greenhouse gas emissions, the equivalent of removing 15,000 cars from the road for one year15

    MATERIALS

    Buildings use 40% of raw materials globally (3 billion tons annually).16

    The EPA estimates that 170 Million tons of building-related construction and demolition (C&D) debris was generated in the U.S. in 2003, with 61% coming from nonresidential and 39% from residential sources20. They also estimate that 250 million tons of municipal solid waste was generated in the U.S. in a single year21.

    Green buildings consume less energy and fewer resources:

  • LEED projects are responsible for diverting over 80 million tons of waste from landfills, which is expected to grow to 540 million tons of waste diversion by 203019.
  • EXISTING BUILDING MARKET

    Approximately 61% of all construction projects are retrofit projects20.

    Current market trends suggest that building owners and managers will invest an estimated $960 billion between now and 2023 on greening their existing built infrastructure.21 It is possible that these estimates could be surpassed in the event of unexpected gains in the US or global economy, if an international climate change agreement is reached or if more positive local policy developments encourage the green building market to grow in new and currently unexpected ways.

    This year, the green share of the largest nonresidential retrofit and renovation activity will more than triple, growing to 25-33% of the activity by value.22.

    Firms that completed green building retrofit projects report:

  • Decrease in operating costs: over one year, 9%; over five years,13%
  • Expected increase in asset valuation according to building owners: 4%
  • Number of years until payback is expected: 723
  • 88% of Building Information Modeling (BIM) users surveyed who are not currently using Green BIM expect that within two years their firms will use BIM on a green retrofit project24.

    One billion square feet of buildings are demolished and replaced with new construction each year.25

    In February 2015, the Energy Information Agency (EIA) reported that energy consumption by the U.S. Federal Government had reached its lowest level since at least 1975.26 Lowering energy usage of its buildings (30% reduction in total energy use, 65% reduction in fossil fuel use) was a key component of reaching this historic accomplishment, and due to the United State’s Federal Government’s status as the world’s number one user of LEED, it is safe to say that LEED buildings played an integral role in helping the federal government to reach this goal.

    BUILDING PERFORMANCE

    A review of data from 195 LEED projects found:

  • The buildings are in the top 11th percentile in the U.S. in terms of energy usage
  • Have an average ENERGY STAR score of 89 points (out of 100)
  • Have a 57% lower Source Energy Use Intensity than the national average (as reported through EPA Portfolio Manager)
  • The majority of the buildings were office or retail, avg. 254,000 sf, certified under the LEED for Existing Buildings: Operations & Maintenance rating system

    An analysis of LEED projects in the San Francisco Bay area found:

  • More than half achieved LEED Gold (52% of the projects)
  • Projects certified under LEED for New Construction exceed ASHRAE standard 90.1 (1999, 2004, or 2007) by 25%.
  • Projects certified under the LEED for Existing Buildings: Operations & Maintenance have ENERGY STAR score of 88 points (out of 100).
  • An analysis of 7,100 projects certified under LEED for New Construction found27:

  • 92.2% are improving energy performance by 10.5%
  • 89% are improving energy performance by 14%
  • Industry Sectors with the Highest Penetration of Green Building28

    1. Education
    2. Health care
    3. Commercial/Office

    What’s Driving Green Building?

    These factors are driving dramatic green building market growth:
    1. Strong market demand
    2. High cost savings for business and tax payers
    3. Public health gains from green buildings
    4. Steady gains in the percentage of large, non-residential commercial or institutional projects that are green
    5. Federal, state and municipal mandates and policies
    6. Increased property values
    7. Low rental vacancy rates for LEED-certified buildings

    TOP 10 LEED LOCALES

    Top 10 States in the U.S.A. for LEED: Registered & Certified (as of February 2015)

    1. Illinois
    2. Colorado
    3. Maryland
    4. Virginia
    5. Massachusetts
    6. Hawa’ii
    7. California
    8. Georgia
    9. Minnesota
    10. (tie)New York
    11. (tie)Arizona

    Top 10 Countries Registered & Certified (as of February 2015)

    1. Canada
    2. China
    3. India
    4. South Korea
    5. Taiwan
    6. Germany
    7. Brazil
    8. Singapore
    9. United Arab Emirates
    10. Finland

    RESOURCES

    1. McGraw Hill Construction (2010). Green Outlook 2011: Green Trends Driving Growth.
    2. McGraw Hill Construction Company. Green Multifamily and Single Family Homes: Growth in a Recovering Market. June 2014.
    3. National Association of Home Builders, “Housing’s Contribution to Gross Domestic Product (GDP),” http://www.nahb.org/generic.aspx?genericContentID=66226. Accessed February 2015.
    4. McGraw Hill Construction (2012). Green Building Market Sizing, drawn from Dodge Project Starts and Construction Market Forecasting Services, as of March 2012.
    5. McGraw-Hill Construction (2010). Green Outlook 2011: Green Trends Driving Growth.
    6. McGraw-Hill Construction (2012). Smart Market Executive Brief. Determining the Value of Green Building Investments: A perspective from industry leaders on triple bottom line decision making.
    7. McGraw-Hill Construction (2012). World Green Buildings Study. Accessed Nov. 29, 2012 via http://analyticsstore.construction.com/index.php/2012-world-green-buildi...
    8. National Trust for Historic Preservation (2011). The Greenest Building: Quantifying the Environmental Value of Building Reuse, Accessed Jan. 26, 2012 via http://www.preservationnation.org/issues/sustainability/green-lab/useful...
    9. Energy Information Administration (2008). Assumptions to the Annual Energy Outlook.
    10. Department of Energy (2011). Buildings Energy Data Book. Buildings Share of Electricity Consumption/Sales. Accessed October 26, 2011 via http://buildingsdatabook.eren.doe.gov/docs/xls_pdf/6.1.1.pdf
    11. U.S. Department of Energy (2011). Re-Assessing Green Building Performance: A Post Occupancy Evaluation of 22 Buildings.
    12. Watson, Rob. Green Building and Market Impact Report – 2011. Accessed Nov. 15, 2011.
    13. U.S. Geological Survey (2000). 2000 data.
    14. McGraw Hill Construction (2010). Green Outlook 2011: Green Trends Driving Growth.
    15. U.S. Environmental Protection Agency. Green Building, Green Homes, Conserving Water. Water Use and Energy. Accessed December 14, 2011.
    16. Lenssen and Roodman (1995). Worldwatch Paper 124: A Building Revolution: How Ecology and Health Concerns are Transforming Construction. Worldwatch Institute.
    17. U.S. Environmental Protection Agency (2009). Estimating 2003 Building-Related Construction and Demolition Materials Amounts.
    18. U.S. Environmental Protection Agency (2008). Municipal Solid Waste Generation, Recycling, and Disposal in the United States: Facts and Figures for 2008. Accessed Nov. 7, 2011.
    19. Watson, Rob. Green Building and Market Impact Report – 2011. Accessed Nov. 15, 2011.
    20. McGraw Hill Construction (2010). Smart Market Reports. Green BIM – How Building Information Modeling is Contributing to Green Design and Construction.
    21. Heather Clancy, “In California, At Least, The Case For Energy Efficiency Is Building,” Forbes, December 30 2014. http://www.forbes.com/sites/heatherclancy/2014/12/30/in-california-at-le...
    22. McGraw Hill Construction (2010). Green Outlook 2011: Green Trends Driving Growth.
    23. McGraw-Hill Construction (2012). World Green Buildings Study. Accessed Nov. 29, 2012.
    24. McGraw Hill Construction (2010). Smart Market Reports. Green BIM – How Building Information Modeling is Contributing to Green Design and Construction.
    25. National Trust for Historic Preservation (2011). The Greenest Building: Quantifying the Environmental Value of Building Reuse. Accessed Jan. 26, 2012.
    26. U.S. Energy Information Administration, “Energy consumption by U.S. government at lowest level since at least 1975,” February 4, 2015. http://www.eia.gov/todayinenergy/detail.cfm?id=19851
    27. U.S. Green Building Council (2012). New Analysis: LEED Buildings are in Top 11th Percentile for energy Performance in the Nation. Accessed December 14, 2012 via http://new.usgbc.org/articles/new-analysis-leed-buildings-are-top-11th-p...
    28. McGraw Hill Construction (2010). Green Outlook 2011: Green Trends Driving Growth.

    1 commentLeave a comment

    Architect, OVACEN
    Undoubtedly the benefits of LEED certification to the property market are clear and beneficial for investors. With a higher rate in sales of the traditional real estate properties. Excellent article. A greeting

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