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.
The questioner never loses the way...
Click here to view the slide deck and let me know your thoughts.
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