Energy efficiency measures pay off in some not-so-obvious ways

Access to better financing, tax incentives, rent premiums, among the benefits to greener buildings.

September 20, 2017 |
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Optimizing energy efficiency in buildings obviously saves money on utility bills, but there are several other ways that green initiatives can boost ROI.

Government programs

Several government programs (the Low-Income Housing Tax Credit program, for example) reward projects that have sustainability features and document energy reduction. Many states and local governments offer tax incentives for green building certification. Nevada, for example, offers property tax incentives for new and existing multifamily or commercial buildings that achieve a certification from LEED or Green Globes.

Access to better financing

Improved energy efficiency can pave the way to better financing. For instance, Fannie Mae and Freddie Mac have begun offering green lending programs (known as Green Rewards and Multifamily Green Advantage) that can translate into savings of up to 39 basis points for borrowers who commit to implementing energy efficiency or water efficiency measures.

Lease premiums

Many companies are concerned with corporate environmental and social responsibility, and consider energy and water efficiency when choosing to lease or purchase property. According to surveys, some commercial renters say they are willing to pay a premium for green office space.

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