Building Highly Sustainable, Energy-Efficient Workplaces: Tenant and Owner Perspectives

Greening the workplace beyond the existing building code requirements requires both tenants and owners to prioritize investing in and tracking sustainability. Two panels of experts, one composed of tenant representatives and the other of property owner representatives, discussed their challenges and solutions at “Beyond Code for a Greener Bay Area: Owner and Tenant Solutions for Sustainable Buildouts,” an event organized by ULI San Francisco and ULI’s Tenant Energy Optimization Program.

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Michelle Malanca Frey, the executive director of ULI San Francisco, welcomes attendees at a recent Tenant Energy Optimization Program event.

Greening the workplace beyond the existing building code requirements requires both tenants and owners to prioritize investing in and tracking sustainability. Two panels of experts, one composed of tenant representatives and the other of property owner representatives, discussed their challenges and solutions at “Beyond Code for a Greener Bay Area: Owner and Tenant Solutions for Sustainable Buildouts,” an event organized by ULI San Francisco and ULI’s Tenant Energy Optimization Program (TEOP).

TEOP, aninitiative under ULI’s Greenprint Center for Building Performance, is a scalable10-step process to help leased spaces achieve 30 to 50 percent energy savingsduring a fit-out. An understanding that tenant buildout, such as during atenant improvement project or the start of a new lease, offers a tremendousopportunity to reduce energy use and improve sustainability is imperative tomaximizing the overall efficiency of the space. The TEOP process includes stepssuch as selecting a team (ensuring that everyone involved in the project knowsthe energy goals), setting those goals, modeling energy reduction, andcalculating projected financial returns. Both the landlord panel and tenantpanel covered how each company integrates TEOP into their standard businesspractices.

Meghan Lewis, global supply chain sustainability program manager at WeWork, described her company’s operational carbon program for the buildings it leases. It has three major components—tracking energy use with utility bills and submetering; working with mechanical, electrical, and plumbing (MEP) and design teams to achieve energy efficiency; and aiming toward deriving all of WeWork’s electricity from renewable energy sources.

She also emphasized that tenantscan play a significant role in reducing embodied carbon in the builtenvironment. “Over the next 30 years, 49 percent of buildings’ climate impact isgoing to come from materials, not operational energy,” she said. Although muchof a building’s embodied carbon is in the structure, the design of the MEP systemsand the interior design can make a substantial difference over the life of thebuilding, she noted. “You have a chance every time you renovate a space to havean impact.”

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From right to left: Jay Sholl (moderator), senior vice president, CBRE; Amanda von Almen, head of sustainable built environment, Salesforce; Andreas Gyr, Real Estate Workplace Services (REWS) Sustainability Program Manager, Google; and Meghan Lewis, senior program manager, WeWork, speaking at a ULI San Francisco event.

Andreas Gyr, real estate workplace services sustainability program manager at Google, described his company’s commitment to carbon neutrality, using Google’s 6 Pancras Square office in London as a case study of how much tenants can achieve.

After new construction for a Googleoffice was put on hold, the company leased space in a developer-built core andshell next door at 6 Pancras Square. “We had had really aspirationalsustainability goals for the ground-up construction project, and we justbrought those goals to the tenant improvements for this project,” Gyr said. “Wemade sure that whatever energy, indoor air quality, biophilia, and daylightinggoals we had were laid out very clearly upfront for the project team.”

This allowed the design team toidentify where the existing building did not meet Google’s criteria and whatwould have to be adjusted. Gyr emphasized that the first steps in the TEOPprocess—select a team and select a space—is, in fact, critical to ensuring thatprojects meet tenant’s goals. Ensuring that all members of the design andconstruction team are sensitive to the tenant’s energy goals and that the basebuilding space is already somewhat efficient will make a buildout process gomore smoothly.

Once the criteria were finalized,Google incorporated them into its owner’s project requirements, making them acontractual obligation for the project team. The building garnered not only certificationunder the Building Research Establishment Environmental Assessment Method (BREEAM)program, but also Platinum certification under the Leadership in Energy andEnvironmental Design (LEED) program. Google also plans to apply for theInternational Living Future Institute’s zero carbon certification for thebuilding.

Salesforce quantifies the carbon impact of materials used in the buildings it leases in order to push suppliers to do better, said Amanda von Almen, head of sustainable built environment for the company. “Just a few years ago, after we made our 100 percent renewable energy commitment and our carbon neutrality commitment, we also committed to measuring and offsetting our embodied carbon by 2030, as well as building all of our spaces to the highest green building standards,” she said.

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A slide from the presentation illustrating the path Salesforce is taking to 100 percent renewable energy.

To make sure that interior spacesare healthy for employees, Salesforce prioritizes natural light, indoor airquality, biophilia, and mindfulness. “We defined a set of six principles foreverything that we want to know about our suppliers and the materials that comeinto our space,” von Almen said. “We turned those principles into our healthy-materialscoring tool so we can take data from different manufacturers and rate them. Andwe set ourselves targets every year for increasing those scores. If amanufacturer wants to pitch us on their product, they have to do better thanthe current product that we already have.”

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From left to right: Brenden McEneaney (moderator), principal, Integral; Ellen Owens, senior project manager, University of California, San Francico; Adam Slakman, global sustainability manager, Hines; and Dan Murtagh, vice president, engineering, Boston Properties, speaking at a ULI San Francisco event.

Sustainability-minded owners and developers have their own challenges inmeeting their ambitious goals for reducing carbon emissions. “The University ofCalifornia has an initiative to be carbon neutral by 2025 in terms of buildingsand transportation,” said Ellen Owens, senior project manager of realestate campus design and construction at the University of California, SanFrancisco (UCSF). “With buildings,we’re on track to reach that goal—if we don’t build any more new buildings. Butwe need more space for research, and some of the UC campuses are quite old, sowe have to build replacement buildings. We also have new campuses that still needto be built out.”

The university system has committed to no longer using fossil fuels foron-site space or water heating in new or renovated buildings. “That’s a challenge,”Owens said. “We have one new building at UCSF that’s completely electric. It’shousing. But for a research building, all electric is not feasible for some ofour energy-intensive uses. Certain types of laboratories have very heavy energyuse.”

She also noted that the university has a policy that all new buildings mustbeat the requirements of the California Energy Code, Title 24, by 20 percent ormeet certain energy use intensity goals. “But Title 24 is about energyefficiency, and all-electric buildings don’t fare well under Title 24. So wehave some built-in challenges.”

Replacing gas boilers with electric heating is even more challenging inexisting buildings, added Dan Murtagh, vice president, engineering,for Boston Properties. “With existing buildings that have had gas boilers inthem for many years, there is no economical way to replace that boiler withelectric heat, and Title 24 doesn’t let you use electric heat,” he said. Itmakes more sense to install high-efficiency boilers in existing buildings andfocus on making sure new buildings are designed to be capable of accommodatingall-electric heating.

Title 24 was created in the late 1970s to encourage homebuilders andcommercial developers to reduce electricity consumption, Adam Slakman,globalsustainability manager for Hines, pointed out. “But Title24—and LEED 4.1, as well—are based on the cost optimization of long-term energycosts.” Gas boilers reduce the peak electricity load compared to electricheating, and lower electricity consumption means utilities do not have tooperate peaker plants, which run only at periods of peak demand.

“Now I think we’re getting to thepoint where all-electrification is becoming a more commonsense option becausethe grid is supplying greener energy than we can generate with on-siterenewable energy in dense urban areas,” he said. “But it’s going to take acombination of advanced technologies and code changes to make it possible. Buildingcodes and LEED requirements have to catch up to the fact that we’re talkingabout energy efficiency and not cost efficiency.”

All the owner representatives onthe panel agreed that a variety of stakeholders can play a powerful role inpushing the built environment further and more quickly toward sustainability. “Investorsas well as tenants can push us, because if you’re going to pick up 90 percentof a $1.3 billion building, you have a big say in what we’re about to do withthat building,” Slakman said.

Murtagh agreed. “Not only do ourclients and our brokers push us in a more sustainably minded direction, but ourinvestors and shareholders are also on the phone all the time asking, Whyaren’t we doing this? Why aren’t we doing more of that? Developers respond topeople who move the needle on the value of the company.”

RON NYREN is a freelance architecture and urban design writer based in the San Francisco Bay area.

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ULI’sGreenprint Center for Building Performance is a cohort of over 35 real estateowners and investors who have collectively committed to a 50 percent reductionin carbon emissions by 2030. To learn more about how to integrate TEOP intoyour practices, visit tenantenergy.uli.org,or email Emily McLaughlin, director of the ULI Center for Sustainability andEconomic Performance, at [email protected].

Ron Nyren is a freelance architecture, urban planning, and real estate writer based in the San Francisco Bay area.
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