RETAIL TENANTS SHOULD BE
BETTER POSITIONED to green their
spaces, given landlords’ efforts. Retail
developers have been steadily greening
their newer properties, and tenants can
leverage some of those strategies.
Just a short year ago, a McGraw Hill
Construction report found rapid growth
in green building among owners,
operators, and real estate developers of
retail. The greenest respondents—those
who were greening more than half of
their new buildings—increased from
18% in 2011 to 38% in 2013, and 43%
of retail building stock was predicted
to be green by 2018, according to the
Green Retail and Hospitality report.
Respondents in the retail sector cited
a number of benefits, including a
7% average asset value increase, an
8% average increase in building ROI,
and an 8% average decrease in annual
More to the point for retail tenants,
half reported boosts to both store traffic
and sales. “This impact is particularly
pronounced among those committed to
green; 63% of those doing 50% or more
green projects see a positive impact,
compared to 38% of those doing a
lower percentage of green work,”
the report said. Furthermore, 45% of
retail/restaurant respondents reported
improved consumer satisfaction from
green building activities.
is too expensive, compared with less
than half last year. And 55% agree that
initial cost often stops them from using
green materials or building methods,
compared with 46% last year.
Financial concerns appear in
half of retailer comments and an
overwhelming majority of designer
and supplier comments about the
industry’s greatest green building
challenge. Many refer to the short-term
nature of retail projects as the limiting
factor in justifying higher initial cost.
“The payback period exceeds
the amount of time a prototype is
relevant,” explains Bruce Barteldt,
global practice leader of retail for Little,
a design firm based in Charlotte, N.C.
Mark Johnson, president of Chicago-
based Johnson Design Group, uses the
analogy of purchasing a hybrid car.
“The average payback does not start
for an average of seven years to offset
the initial cost. Who keeps a car for
A quick payback is still more likely to
get retailers to specify a green building
product: 18% will pay more initially
if the product pays for itself in seven
years, 18% will if it pays for itself in five
years, and 32% will if it pays for itself
in three years.
Cost isn’t the only impediment. More
than a third of retailer comments
about industry challenges relate
to the perceptions of management,
consumers, and other stakeholders.
LEED fatigue may also be a factor.
As one designer who wished to remain
anonymous put it, “I realize there are
other green building rating systems
available, but LEED is getting too
complicated.” Suppliers also mention
challenges regarding end-of-life
management and sourcing.
With much of the low-hanging fruit
already plucked, finding green building
strategies that fit within budgetary and
other project needs is not always easy.
But retailers, designers, and suppliers
do see some opportunities. Lighting
figures prominently in comments about
industry opportunities, appearing
in half of retailers’ and designers’
comments. Energy reduction also is
frequently mentioned. Addressing
the end-of-life management issue,
suppliers cite opportunities in
recycling, increased durability,
and replenishment of fixtures.
Reuse can play a role as well, adds
Barteldt. “Retailers need to think
about their prototype as being more
flexible, not only to keep up with
ever-accelerating trends, but also
to be sustainable with the practice
of creative reuse of visual elements
of their brand,” he says. “Instead of
constantly trashing the last prototype
(literally), think smart. Anticipate
change as a fundamental framework
of the design. As a result, the store will
become more sustainable.”
Retail tenants can benefit from landlords’ efforts
For those who want to address wide-scale
sustainability programs for their projects,
Miller Zell’s DeAnn Campbell provides
an overview of benchmark systems on
page 28. Callison offers a new free online
tool to help retailers green their spaces;
read how it works on page 12.