Thursday, October 4, 2007

The Lender Case for Going Green

I had a good time this afternoon with the USGBC Chapter BayLUG (Bay Area LEED User Group), along with Chris Bartle of Green Key Real Estate. I gave a banker's perspective on green commercial real estate and Chris shared his expertise on the situation for green residential. My synopsis on financing green commercial real estate:

  • Many real estate deals are sidelined now due to current capital market conditions.
  • The positive business case for going green is being heard by financial institutions. I receive a strong, constant flow of positive anecdotal evidence that green buildings deliver superior economic performance.
  • Financing green buildings is hampered by poor integration of the players.
  • While an investment in a green building creates much additional value overall, there is an uneven allocation of that economic upside among the different players -- lenders are not seeing a tangible (read: cash) value-add for financing green, and so have been sluggish to establish green lending programs.
  • More organizational and industry paradigm shifts are on the way as green buildings emerge as a preferred investment asset for institutional real estate.
How to move forward? As they say in Cameroon,
The questioner never loses the way...
Click here to view the slide deck and let me know your thoughts.

1 comment:

Celia said...
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