Multi-Tenant Buildings Present Green Challenges

The Rocky Mountain Institute’s ‘Built Environment’ Team released a new report, “Barriers and Breakthroughs for Multi-Tenant Developments” to address multi-tenant buildings, a logistical pain in the butt for green innovators.

Selecting effective incentives to encourage multi-tenant buildings to adopt green upgrades is proving difficult for an array of reasons. Not only are tenants often contractually prohibited from making substantive changes to their rentals, but if they do, the benefit stays with the landlord, who can also retain the tax benefits. Additionally, landlords have been slow to adopt green design, doubting their return on investment. Environmentally minded tenants are left to lobby their landlords to argue the case for greening.

This is where the Rocky Mountain Institute’s BET comes in. The RMI-BET seeks to make it clear to landowners that making energy and clean-tech investments pay off, in the short and long term, for both tenants and landlords. In fact, it seems that environmental investments in real estate can raise the value of the property and may result in higher rental rates. The RMI-BET report also points to improvements in leasing procedures that can remedy issues, such as incorporating infrastructural upgrades into leases, anticipating renters’ realistic square footage needs, also suggesting strategies for marketing and financing. Read more or get the report at the Rocky Mountain Institute.