In my thirty years with Turner Construction, I’ve had the opportunity to serve as an engineer, a project manager, do business development and financial management. Today I lead Turner’s national industrial group, a center of excellence for Turner’s manufacturing and industrial construction projects. It’s a sector that brought in over $613 million in 2014, and with over $388 million in green building projects (which almost always means LEED). There are many manufactures that understand the investment value of sustainable building and construction.
If you read my colleague Taimur Burki’s article, you’ll know that manufacturing is an industry driven by process costs and that while companies are also motivated to do the right thing, to protect the environment and to build their reputation as a sustainability leader, it always helps to see financial benefits in the millions of dollars.
When I hear clients question whether or not LEED is worth the investment for their manufacturing facility, particularly if they aren’t a publicly facing company or a well-known brand, I like to accept that challenge and demonstrate that LEED is well worth the investment.
Why is LEED worth the investment?
It drives efficiency in the process and the systems, it doesn’t cost that much, and the return on investment is pretty doggone good. It just makes sense. And if you’re thinking about your reputation in the market, or how to stay ahead of future restrictions on emissions, or if a second or third tier manufacturing company wonders if their biggest customer will start to ask for better performance from their supply chain, then it’s absolutely worth the investment.
LEED pushes an integrated project delivery model, which means that as the construction company for a major industrial facility project, we’re at the table from the beginning with the owner, designers, engineers and the building operators. We’re all working together from the very beginning to the completion of construction, and that kind of work reduces the risk of costly change orders, and provides for greater predictability of systems, installation, materials. LEED also drives a structure or process within which to measure and benchmark various ideas. Structure means predictability and efficiency, which means it’s time and money well spent.
Consider the investment for the following hypothetical project.
For a building of this size, with this kind of social, economic and environment impact, an increased cost of 1.63% of using LEED, but it could be as low as 0.8%.
Next, consider the return on investment for a manufacturing plant. It’s not unusual for a facility to spend upwards of five million or more dollars a year on energy alone. In the hypothetical example we provided below, we’re looking at a simple ROI for various numbers of years. This is assuming a strict ROI valuation and discounting soft values. It’s also important to think long-term about the investments in systems that will last for the entire life of a facility, producing savings long after the investment has been amortized.
Green building and LEED are a growing trend in the manufacturing industry. We built a major plant for Boeing in South Carolina, and it’s been amazing to see the shift in thinking. We’re now seeing companies looking for more aggressive energy and water savings goals, pushing for zero waste, and showing even greater awareness of human health and safety in manufacturing buildings. As one of the leading construction companies of American manufacturing facilities we believe LEED is worth the investment and we encourage our clients to strongly consider certification.
If our past success with LEED for manufacturing facilities is any indicator, then we predict that big companies that produce everything from planes to semi-conductors to pharmaceuticals will embrace the investment opportunity and a chance to reinvest in the health and wealth of our communities.
Check out the other articles in our series on the "Five myths of using LEED for manufacturing" and hear from industry experts:
- Myth #1: Fortune 100 or 500 companies don’t actually use LEED for their own buildings with Joe Azarello,Kohler
- Myth #2: Factories can’t be green by Taimur Burki, Intel Corp.
- Myth #3: LEED is not worth the investment by Brian Knowles, Turner Construction
- Myth #4: Industrial process energy use is incompatible with LEED by Angi Rivera, AECOM
- Myth #5: Industrial facilities are too large and complex for LEED by Osvaldo Gonzalez Martinez, CH2M HILL