Making Green Communities Work

By Kellenberg, Steve | Real Estate Issues, Spring 2004 | Go to article overview

Making Green Communities Work

Kellenberg, Steve, Real Estate Issues

THROUGHOUT THE NATION, THE BUILDING AND COMMUNITY development sectors of the real estate industry are looking more seriously at incorporating "Green" solutions into their projects. Of course, all of these programs cost money to implement, but this isn't stopping many of the enlightened builders and developers who believe the benefits of Green far outweigh the costs. But what exactly does "Green" mean?

Also referred to as sustainable development, Green development (or Green communities) offers an opportunity to create environmentally sound and resource-efficient buildings and communities by using an integrated approach to design that is sensitive to natural resources and their protection. Green development promotes resource conservation, including energy efficiency, renewable energy, and water conservation features. It also takes into account environmental impacts and waste minimization with the goal of creating a healthier and more comfortable environment; reducing operation and maintenance costs; and addressing issues such as historical preservation, access to public transportation and other community infrastructure systems.

With Green development, the entire lifecycle of a development and its components is considered, as well as the economic and environmental impact and performance. An increasing number of developers, land planners, designers, and real estate owners are becoming interested and involved in Green development. National and local programs encouraging Green development are growing and reporting successes, while hundreds of demonstration projects and private developments across the country provide tangible examples of what Green development can accomplish in terms of comfort, aesthetics, and energy and resource efficiency.

While there is a lot of information on Green development available for individual buildings, little exists for large-scale, master-planned communities. Major developers everywhere are trying to make sense of the hundreds of products and applications that could lead to a more sustainable (and hopefully bankable) project. The approach described here attempts to provide a general roadmap for applying Green practices to large, complex, market-driven land development projects. It suggests a process that incorporates market demographics, probes consumer values, and filters Green building and development components through a cost/benefit analysis, all with the goal of assessing from different viewpoints what it would mean to integrate a Green program--or elements of a program--into a project's financial blueprint.


Community developers are pursuing Green programs for four key reasons: 1) it is the right thing to do, 2) it improves public and civic image, 3) it accelerates jurisdictional approvals, or 4) it fills an unmet market demand.

Aside from the financial benefits, such as reduced operating costs, value-added premiums and reduced capital costs, green development is appealing because it is development for the future, not just today. Many people like to be associated with projects or developments that are forward thinking and environmentally sound. Indeed, there is satisfaction and value from doing the right thing, both on the part of the developer/builder and the homebuyer.

Clearly consumers are interested in sustainable design. A 2001 survey for the Cahners Residential Group found that eight of 10 homebuyers interviewed say that new homes do not meet their expectations for environmental sustainability, and 96 percent said they would pay more for a home with "Green features." More than half would pay $5,000 to $10,000 extra for a Green home. In a 2001 Housing Zone/Professional Builder survey, consumer belief that new homes do not meet buyers' sustainability needs increased from 60 percent to 80 percent in one year, and the belief that energy efficiency is very important rose from 50 percent to 91 percent during the same period. …

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