Green Building Retrofits Represent a Potential $400B Market
Boosted in part by the American Recovery and Reinvestment Act, which will provide significant funding for renovations to federal building, the total potential market for major green renovations in the commercial building sector is approximately $400 billion, according to a new study by Pike Research.Â Although currently a relatively small market, the market researcher forecasts that comprehensive efficiency retrofits will more than triple in annual revenue to $6.6 billion by 2013.
The market researcher says the total U.S. commercial building market, with 70-billion square-feet of space, delivers one of the largest opportunities for energy savings, reduction of carbon emissions and increased property values.
While direct energy savings can be significant with green retrofits, the study, “Energy Efficiency Retrofits for Commercial and Public Buildings”, indicates that most major projects will not be driven by cost savings, but instead will be initiated to meet broader policy and business objectives such as lower carbon footprints, higher employee productivity, and higher property values.
Backing these findings, a study released last year by The Global Facility Management Association, finds that ninety-two percent of survey respondents to the Green Practices Study say that they are working to make their facilities more sustainable. In addition, 67 percent say their customers are “forcing them” to make sustainable changes, while forty-six percent say the government is forcing the change.
Another recent study shows that commercial building owners canÂ reap higher rental premiums for green buildings. The study, conducted by the Henley University of Reading in the U.K., shows that certified buildings provide a rental premium and that the more highly rated that buildings are, the higher the rent. Based on a sample of transaction prices for 292 Energy Star and 30 LEED-certified buildings, price premiums were 10 percent and 31 percent, respectively.
The Pike study examines market opportunities, drivers, barriers, and best practices within the commercial building sector.Â It also provides detailed quantitative analysis for green retrofits, along with forecasts for market growth over the next five years.
Still at the infancy stage, green building retrofit companies are creating new ways to show organizations how to save money, cut energy use and reduce carbon emissions through energy and lighting retrofits.
The Energy Retrofit Group (ERG), a subsidiary of Adache Group Architects, Inc., as an example, has launched its new energy conservation website, aimed at showing how large commercial buildings can maximize their energy efficiency through retrofits, reports Building Design & Construction.
The site provides links to government programs and tax incentives for energy retrofitting as well as links to government loan guarantee programs for energy retrofits and renewable energy grants for solar, wind and geothermal installations.
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