By Josh Wolff
A recently constructed lease document hopes to resolve some of the issues stunting the progress of buildings becoming more environmentally friendly.
The Model Green Lease, which was created by a task force of corporate tenants, landlords, attorneys, real estate brokers, and “green” building consultants, began as a blank document, starting from scratch, rather being a revision of an existing document.
Jenner & Block Of Counsel Ronald B. Grais served on the task force and contributed mainly as an editor of the new lease document. He said the array of experts on the task force enhances the document’s functionality.
“The goal was to create a balanced document that can be used by as many people as possible,” Grais said. “To get that balance, you need as many people as possible working on it. To get a document workable for both sides requires a lot of input.”
The document has three primary objectives: encouraging green office buildings, maximizing the return on investment of the green buildings, and providing a healthy and more productive workplace.
However, the biggest issue that remains in preventing more environmentally-friendly buildings is the “split incentive.” Property renters don’t want to invest in property they don’t own while property owners don’t want to make “green” investments unless they can get a return on their investment.
The Model Green Lease task force hopes it solved this problem by introducing its modified gross lease where the landlord agrees to pay the utilities up to a certain point and after that point, the tenant becomes responsible for the payment. It provides an incentive for both parties to make investments and more responsible choices.
The new lease document is consistent with the various green rating systems, including LEED, Energy Star, and Green Globes. It also touches on many of the other issues facing buildings, such as carbon credits, recycling, insurance, and IAQ.
While the green movement has become more prominent in the United States the past few years, many buildings still haven’t become green. Grais has a simple explanation for this phenomenon.
“The bulk of buildings are existing buildings, not new ones,” he said. “Most were built at a time when energy was cheap.”
While it is easier for new buildings to be more environmentally friendly, older buildings aren’t precluded from taking small, but meaningful steps to become green.
Many buildings have vacant space that uses the same amount of energy to cool and warm the vacant rooms, as does occupied space. Grais recommends as a no-cost fix that in the summer, vacant buildings blinds should be closed to prevent overheating and in the winter, the blinds should be open to warm the room. Simply paying more attention to the management and operation of a building can have great results, he said.
He also said when plumbing fixtures wear out and leak in old buildings, it’s an optimal time to install low-flow fixtures, which reduce water consumption. Adding proximity switches to lights is another inexpensive step to becoming more environmentally friendly.
When an office building becomes green, the environment isn’t solely affected; both workers and landlords reap the benefits.
“There is pretty clear evidence that occupants are more productive when green measures are taken,” Grais said. “Task lighting that is properly coordinated so more natural light is captured into a room is pretty simple and highly desirable for workers. It can make a big difference in the way people feel about their workplace.
“And for landlords, buildings tend to lease faster and at higher rates if they are green.”
The Model Green Lease is available on CD or downloadable on the Internet at http://www.squarefootage.net