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BOMA NEWS - June 05, 2024

Why Tenants Should Leverage the Sustainability Story of Their Leased Spaces

By Mike Parker

In a time when companies are scrambling to foster client loyalty by being the most sustainable and governments are introducing regulatory policies about mandatory Environmental Social Governance (ESG) reporting, most companies would not expect to turn to their landlords to help address both. But that is indeed where they should be looking. If their building has a sustainable certification, a tenant’s leased space can offer compelling sustainable stories that often carry a far larger green footprint than their actual business. And most have yet to come close to leveraging its actual value.

Here is a simple example. If a company leased a space in a BOMA BEST Platinum certified building in 2013, by 2024, on average, this building would have reported an 84% decrease in carbon output. Just by leasing such a space, a company would have contributed to this impressive reduction and gained a valuable point to highlight in its ESG reporting—often making it a prominent feature on the cover of its annual ESG report.

These are three compelling reasons:

  1. Enhanced Brand Reputation:

A 2018 study found that 86% of millennials would consider taking a pay cut to work at a company whose mission and values align with their own. For most companies, building the type of brand reputation that would attract these people both as employees and team members is imperative. Today, an elemental part of brand reputation is environmental stewardship, and this has to go beyond just talking about it. Leasing in a sustainable certified building does just that. It reflects a commitment to environmental stewardship and social responsibility with demonstratable results. This alignment with sustainability will only enhance a company’s public image, making it more attractive to customers, investors, and potential employees who value environmental consciousness. Additionally, as regulatory standards for environmental performance tighten, occupying sustainably certified spaces can position a company as a forward-thinking leader, prepared for future regulations and less susceptible to the risks associated with non-compliance.

  1. Cost Efficiencies:

A company would only be doing its due diligence if it attempted to be more financially efficient. The challenge is not impacting operations in a manner that could be conceived as negative to the team. One does not have to read too far into a sustainable certified building report to see that it is the perfect tool to cut operational costs and improve staff morale. Certified buildings typically feature advanced energy-efficient technologies, improved HVAC systems, better insulation, and other sustainable design elements, significantly reducing energy and water usage. All of this leads to significant cost savings and a much greener story for the occupants. Examples of these types of stories include a building replacing incandescent lighting with LED lights or investing in sensors to make lighting and heating more efficient and effective. Over the duration of a lease, these savings can be substantial, making the economic case for choosing buildings with sustainable certifications.

 

  1. Healthier Work Environments:

In 2024, researchers from Harvard T.H. Chan School of Public Health produced the COGfx Study, which found that in a conventional office building, tenant cognitive scoring went up by 61% in a sustainable certified building and 101% if the building had reached the highest level of certification.[1]  Indoor environmental quality, including air and water quality, directly impacts tenant health and comfort and are key components of any building certification. Features like enhanced ventilation systems, non-toxic, low-emission materials, and abundant natural light create a healthier workplace. This not only aids in the well-being of employees but can also lead to increased productivity, reduced absenteeism, and greater overall satisfaction in the workplace. It is also a significant selling feature when trying to attract and retain employees.

In short, there are significant opportunities for leasing agents, brokers and building managers to inform their clients about the benefits of a sustainable certified building. And for tenants, reach out to your landlord to discover what your business can leverage from any certifications your building has.

[1] https://thecogfxstudy.com/study-1/cognitive-function-tests-scores-doubled/