For commercial real estate managers, diversity is embraced when assessing sustainability

Commercial real estate performance programs such as LEED and BOMA 360 are becoming popular tools for building owners to showcase their sustainability efforts.

When determining a commercial building's performance, there are a few programs for you to choose from. 

According to data from the Institute of Real Estate Management, an average office building's utility costs compose about 24 percent of its overall operating expenses. While the installation of solar panels or small roof-mounted wind turbines can lower operating costs by 15 percent, more detailed retrofits  – like efficient toilets and sinks with restrictive nozzles – can reduce costs by 3 to 15 percent depending on the scale of the project. As technology becomes more efficient, the savings increase. The way to assess how well a building utilizes such sustainability technology is through an assessment program.

The programs up for grabs
As outlined in the New York Real Estate Journal, the most popular of these performance assessment programs is the Leadership in Energy and Environmental Design program, or LEED, led by the United States Green Building Council based in Washington, D.C. It's essentially a rating system. Each building gets a score on a 110-point scale, with different levels of efficiency. Commercial buildings must meet certain efficiency and energy prerequisites to secure a positive rating.

On the other hand, there is the emerging popularity among commercial real estate professionals to enhance their efficiency snapshot by employing a separate but mutually enriching assessment program called BOMA 360 Performance Program, BOMA standing for the Building Owners and Managers Association. Think of it as a standardized test: LEED is the SAT, while BOMA 360 is the ACT.

"You're comparing your performance to a broad base of industry practitioners," Brian Burg, vice president and general manager of Cushman & Wakefield, told Finance & Commerce. "LEED is focused more on energy consumption and sustainable operating practices. BOMA 360 requires that, too, but recognizes you're operating a piece of commercial real estate and you have various other areas of performance you need to look at."

Many building owners like the BOMA 360 program for its comprehensive assessment of a property by evaluating other facets of operations in addition to energy and efficiency. For instance, BOMA takes into account a building's tenant relations, emergency preparedness and professional development programs.

While BOMA 360 remains much smaller than LEED, the program is only four years old and is expected to become a major assessment tool used by commercial real estate companies in the future.

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