Interest in reducing energy consumption in commercial buildings continues to gain momentum in the public and private sectors. In the public sector, President Obama earlier this year proposed a $2 billion loan guarantee program in the FY 2012 budget for energy-efficient building upgrades, part of the administration’s new “Better Buildings Initiative” to achieve a 20 percent energy use improvement in commercial buildings. In the private sector, an alliance of real estate investment companies formed a new nonprofit called the Greenprint Foundation to anonymously share the operating efficiencies of their building portfolios, then work toward lowering the carbon emissions.
Both of these efforts took center stage in March at what was billed as a “Catalytic Convening on Energy Efficiency.” The invitation-only event, which ULI helped organize in Washington, D.C., brought together some 200 emerging leaders in the sustainability movement—including a wide range of Obama administration and federal agency directors—to discuss how to better align and advance the energy-efficient retrofit market. One of the featured panelists was ULI trustee Charles B. Leitner III, chief executive officer of the Greenprint Foundation and chairman of RREEF, the global real estate investment business of Deutsche Asset Management.
Leitner has spent more than two decades at RREEF, most recently as its global head, leading the globalization of the real estate and infrastructure businesses. RREEF was one of the founding members of Greenprint, and Leitner was one of Greenprint’s founding board members.
Recently, Urban Land caught up with Leitner to discuss the Catalytic Convening event and Greenprint’s leadership as a catalyst for change.
ULI: What is Greenprint and what is its important mission?
Leitner: Greenprint is a worldwide alliance of real estate owners, investors, and financial institutions committed to reducing carbon emissions across global property sectors. The founding members were a combination of public companies like AvalonBay, ProLogis, and Douglass Emmett and private equity investors like Blackstone, Hines, Jones Lang LaSalle, and RREEF. All of the initial members have ownership interests and provide a landlord’s perspective. Our stated mission is to reduce carbon emissions in the built environment while increasing property values.
There is mounting evidence that properties with lower carbon emissions increase in value through the use of energy-reducing management strategies and technologies. Our purpose is to organize the real estate community around a common measurement standard to track performance in energy consumption. To this end, we’ve developed the Greenprint Carbon Index for which our members anonymously share operating data for their properties, to measure their collective carbon footprint. Our first volume was released in October 2010, with volume 2 set for publication on June 30, 2011. As additional volumes are published, the index will chart our members’ progress in reducing energy usage and carbon emissions as they seek to enhance their portfolios’ value and implement improved technologies and practices.
ULI: You have had a long and distinguished career in real estate finance and investment. Why have you made the decision to work on behalf of this organization?
In the course of a career, some themes become more apparent for the future, and for me, that’s sustainability in real estate. RREEF was approached to be one of the founding members of Greenprint, and I had been a member of Greenprint’s board of directors since its founding. Greenprint was developing an energy consumption database and unified performance standards to differentiate itself from others in the green building movement, and the not-for-profit model was critical to act as a leader and catalyst in this effort. I thought this was a pretty interesting way to put my experiences and relationships to work in a new collaboration, with an eye toward improving the performance and sustainability of real estate across the globe. It is an important leadership position in the built environment, and that makes sense to me at this stage in my career. I see it as an opportunity to apply my experience to a greater good initiative in an industry in which I’ve enjoyed being a part.
ULI: You recently participated in the ULI-supported Catalytic Convening event. What did you take away from it?
Leitner: The common theme was a real commitment to get organized around this issue. Public, philanthropic, and private sector focus on energy efficiency has risen dramatically, yet coordination and alignment across agencies and industry sectors have been inconsistent. The event itself reflected a heightened level of activity within the administration on this issue, and while there are political hurdles that remain, it was encouraging to witness the elevation of energy efficiency as an administration priority. Overall, it was a powerful convening. Cooperation is one of the most important issues. At Greenprint, we are trying to be a catalyst for cooperation and collaboration in the private sector, by developing innovative and practical tools like a common standard for performance measurement while working with other stakeholders. There is a huge amount of momentum around the built environment with respect to carbon reduction and lower energy consumption.
ULI: The fact that White House representatives from the Council on Environmental Quality and Office of Management & Budget, among others, participated in the event demonstrated the ascendency of the issue of energy efficiency in real estate. Can the administration’s efforts to advance the issue further be sustained?
I hope so. Clearly, there’s an honest and legitimate commitment to advancing energy efficiency policies and practices. But there’s also a practical understanding of the political realities we face in Washington, and that is challenging. Representatives of Congress were not in the room, and it’s easy to be a little discouraged by that. But I think it’s got potential, and there’s a real commitment to try.
ULI: What is the appropriate role for ULI to keep the momentum going?
Sustainability is one of the cornerstones of ULI’s mission, and ULI’s role as an educator and convener can continue to have a major influence on this issue. ULI’s recent report, “Climate Change, Land Use, and Energy 2010,” served as an important building block in the discussion of energy efficiency in real estate. ULI’s reports aren’t used just by its membership, but are digested and followed by government and industry leaders, demonstrating that ULI is a very credible source on these issues. ULI can continue to exert its leadership through sharing best practices, publishing case studies, and analyzing financing opportunities. ULI is one of the few real estate industry conveners that can represent and educate all of the constituencies that have an investment or policy-making interest in energy reduction in the real estate industry.