As the world embraces new standards for combating climate change, energy-intensive industries will be tasked with leading the way. Given that new construction and daily operations of buildings produce around 40% of the world’s greenhouse gases (GHGs), building owners will face increased pressure to improve energy efficiency and create more sustainable buildings.
Many building owners are proceeding cautiously, waiting for regulations and industry guidance, but forward-thinking owners understand that sustainability is not only good for the environment but helps maximize profitability.
Here are three ways sustainability can help building owners accelerate growth.
Energy efficiency savings go straight to the bottom line to increase profitability.
On average, thirty percent of the energy used within buildings is wasted through inefficient equipment or operation. Eliminating that waste provides a massive opportunity for immediate and ongoing savings – equalling millions of dollars across a portfolio of buildings over time.
While many landlords embraced LED lighting or occupancy sensors to help reduce energy consumption, they are now looking for additional ways to improve energy efficiency. One of the most significant opportunities for savings is increasing the efficiency of building HVAC systems, which represents about 40 percent of energy use in most commercial buildings.
“We help our customers understand where energy is being consumed and wasted in their buildings, and by what equipment, to help them achieve maximum energy efficiency,” said Jessica Morris, Turntide Technologies director of product marketing for built environments. “We can help put savings on auto-pilot with optimal setpoints and schedules to ensure equipment runs at its most efficient settings, allowing facility managers to focus on more important issues within their portfolio.”
Turntide for Buildings, introduced earlier this year, is a full-stack intelligent building solution that allows landlords to centrally manage conditions throughout their building or portfolio from one centralized location. By connecting an optimally efficient Smart Motor System™ with intelligence and cloud-based controls, landlords get a new level of visibility and reporting, including monitoring temperature, humidity, and indoor air quality. Turntide customers have seen an average of 64% savings in HVAC energy consumption from the software-driven switch reluctance motor.
According to ENERGY STAR, $1 in energy savings has the same bottom-line impact as $59 in increased sales, so anything you can do to be more energy-efficient reduces how much you have to generate in sales to meet the same level of profit.
“People want to run efficient buildings because efficient buildings help them make more money to distribute to their shareholders,” said Tom Lonergan, strategic accounts executive for Turntide, who believes that increased regulations will drive building owners to look for new ways to reduce the costs of managing their buildings and optimizing net operating income (NOI).
Sustainability as a selling point.
As tenants begin to account for their carbon footprints, they increasingly demand more sustainable buildings and are willing to pay a premium for them. Sustainability is now an important factor when selecting a property.
Numerous studies over the past few years have tied green buildings to higher profits. A study by real estate investment firm Bentall Kennedy found that LEED-certified projects take in 3.7 percent more in rent and have four percent higher occupancy rates than comparable non-LEED buildings. It also noted ENERGY STAR buildings earned 2.7 percent more in rent and had 9.5 percent higher occupancy rates. These are just a few examples of the ways sustainability can lead to higher revenue and profitability.
“Buildings that are green, or more sustainable, tend to have higher occupancy rates and lower turnover and command higher rents. So there’s a strong business case for embracing sustainability,” said Morris. “Owners who act now to make their buildings more environmentally friendly will see a competitive advantage; those who fail to do so will get left behind.”
Healthy environments increase sales and improve the productivity of workers.
COVID has heightened awareness of indoor air quality and the importance of providing a healthy building environment. Green buildings, often considered safer and healthier than traditional buildings, are in high demand as companies reevaluate their spaces and prepare to bring workers back to the office.
Ensuring the comfort and safety of occupants is essential for renting your properties and improving the productivity of your workers.
A study from the World Green Building Council found that thermal comfort impacts workers’ productivity. A cold office reduces productivity by 4%, while a warm office will reduce it by 6%. The same intelligent equipment used to improve energy efficiency within the HVAC system can also reduce energy bills, optimize comfort, and increase worker productivity.
Failure to create a comfortable environment can lead to employee turnover. In today’s tight labor market, where the cost of replacing an employee can be as much as 33 percent of the employee’s annual salary, according to Employee Benefit News, that can be a substantial hit to your bottom line.
Given the massive emphasis on sustainability from all angles, making your building as environmentally healthy and efficient as possible is a move that produces nothing but upside for building owners.
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