Sustainable Development Brings Business Opportunities
Leaders Affirm "Green" Benefits at AACRE Symposium
May 11, 2007
"Green" development is not just good for the environment — it's good for business. That was the message repeated by speakers at a symposium on sustainable real estate co-sponsored by the Alumni Association of the MIT Center for Real Estate (MIT/CRE) and by the Urban Land Institute.
Held at the MIT Faculty Club on May 11, the symposium agenda attracted a large crowd of real estate industry professionals, finance professionals, and MIT/CRE alumni/ae and students. Prominent business leaders — including Mark Buckley, vice president of Environmental Affairs at Staples Inc.; Tedd Saunders, president of EcoLogical Solutions Inc. and co-owner and executive vice president of Saunders Hotel Group; and Robert Ansin, president and CEO of MassInnovation — affirmed that the growing demand for environmentally sustainable building represents a opportunity for businesses to benefit, often richly.
David Geltner, director of MIT/CRE, introduced the program. "Real estate is the largest energy consumer in the United States, bigger than transportation or industry," said Geltner. "More than half the people living in cities by the year 2050 will be occupying new space. The real estate industry has a huge responsibility to design and construct more energy efficient buildings. By the same token, the urgent need creates tremendous opportunities."
MIT alumnus Marc Rosenbaum, founder of Energysmiths and keynote speaker for the symposium, echoed Geltner's point. "We're probably approaching the point where half of the world's carbon dioxide emissions are linked to buildings," he said. Yet he was quick to affirm that growing interest in green building has been good for his company. Founded nearly 30 years ago, Energysmiths is prospering by developing buildings that are not only resource efficient, but also comfortable, durable, and adaptable for the future.
"In January, 27% of the U.S. trade deficit was for petroleum imports," Rosenbaum added. "Building green keeps jobs and money in the United States." Rosenbaum's portfolio of projects, many of which he showcased during his presentation, includes private homes, new and renovated academic buildings, and old industrial space renovated for residential use. Successful green buildings, he said, are safe, healthy, comfortable, durable, and resource efficient; they economically utilize water, capital, transportation, materials, and energy.
Additionally, he said, drawing a distinction between adaptability and flexibility, effective green buildings should be adaptable. "Flexibility doesn't work," he said. "Flexible buildings try to be all things and fail." Adaptable buildings, on the other hand, do some things well, but can be modified to meet unforeseen future needs. To underscore the point, he noted that his company had been involved in renovating a significant number of solidly constructed buildings that were 100 to 200 years old, whereas many houses built during the 1950s and 1960s were being torn down to make room for better quality construction.
Rosenbaum discussed many of the projects his company has worked on — for clients that include MIT, the Vermont Law School, Stonyfield Farm, Dartmouth College, the Woods Hole Research Center, and the Yale School of Forestry and Environmental Studies. Collectively, the projects showcased a wide array of energy conserving technologies, including high quality insulations, heat recovery ventilation systems, drain water heat recovery, energy saver thermal windows, and low energy distribution systems.
In common, Rosenbaum said — underscoring the fact that sustainable construction not only can be energy efficient, but should also be compatible with consumer comfort — high quality green buildings are more than simply energy efficient. They are "buildings people love," he said.
It was a message reaffirmed by Buckley, Saunders, and Ansin, each of whom described how his company had adopted sustainability as a key operational component and all of whom said doing so had been a successful business decision.
Mark Buckley spoke at length about Staples' commitment to enhancing sustainable business in three specific areas of corporate performance — economic, social and environmental — emphasizing environmentally preferable products, recycling and energy and climate management. The company has adopted an absolute carbon reduction target of 7% below 2001 levels by 2010, and has adopted a host of innovative policies in all three areas. It is, for instance, using more sugar cane fiber to manufacture paper in Argentina. This practice means that far fewer trees are cut for paper production, and it has simultaneously reduced local air pollution, which was a negative byproduct of burning fiber left from the wood used to make paper previously.
The company has also made a strong commitment to recycling, a policy that it is pursuing through corporate practice as well as programs that make it easier for customers to recycle. And it is engaged in environmental education, especially through the website www.earth911.org, which provides information on many green-related issues, including climate change, water, energy, and composting. Staples has developed nine solar projects thus far, said Buckley, and the company has identified more than 150 projects it expects to pursue, including wind power, hybrid delivery vehicles, and land-based carbon sequestration projects.
Tedd Saunders, who won the President's Environment and Conservation Challenge Award and co-authored the book The Bottom Line of Green is Black, talked about the remarkable range of environmental innovations he championed at the Boston Park Plaza Hotel. They ranged from such smaller-scale changes as recycling, use of natural cleaners and adhesives, and shopping locally, to retrofitting with thermal windows and state-of-the-art energy management systems.
"We've pioneered a green model that's creating buzz in the hospitality industry," Saunders told the group, noting that his company has benefited not only from positive public relations, but from a significant competitive advantage and higher profits. To explain how such modifications can dramatically conserve energy and save money he noted that installation of a $210 water faucet saves the company $1,500 in energy and water costs annually. "We've proven that environmental practices pay off," he said.
Robert Ansin addressed green building by citing his company's first project — MassInnovation's conversion of the former Antwelt Shoe Company in Fitchburg, Massachusetts in the 1990s. The 400,000-square-foot building would become the MassInnovation Center, a successful mix-ed campus that features what was New England's largest solar installation at the time of the renovation.
Realizing that demolishing part of the outmoded mill and trucking the debris to landfills would cost him $250,000, Ansin opted instead to dismantle the buildings and sell the components. The decision to recycle, he says, turned that aspect of the overall project into a money-maker, and the conversation set the tone for MassInnovation's ongoing work.
Currently the company is engaged in the largest green project in New England, the conversion of the 1.3 million-square-foot Worsted Wood Mill, the largest original mill building standing in Lawrence, Massachusetts, into a large residential complex. Not only does the project — known as Monarch on the Merrimack — involve the rescue and reuse of a historic building, but it features residential space, geothermal heating, a "green" roof, and creation of six acres of riverside green space. "Green and sustainable buildings aren't just the right thing to do," Ansin told the group. "We've found that they are what people want."
The symposium also featured a "You Can Do It" roundtable, moderated by Prof. Sarah Slaughter of the MIT Sloan School of Management. Participants John Dalzell of the Boston Redevelopment Authority, Jim Christo of Massachusetts Technology Collaborative, and Kim McLaughlin of Bank of America told participants how their respective organizations can help businesses, real estate investors, and developers benefit by building, renovating, and operating with sustainability in mind.
"The growing interest in sustainability reflects the increasing concern about the impact on our environment, the rising cost of energy, and the mounting evidence of the holistic benefits of building green," concluded David Geltner of the MIT Center for Real Estate. "The structures built by the real estate industry comprise over a third of the world's tangible wealth, and are responsible for over a third of the world's energy consumption and CO2 emissions. For the industry to maintain its responsible leadership in the global community, it must encourage a culture of sustainability and innovation that meets the challenges of an increasingly interconnected world."
The Center regularly visits the issue of sustainability in all of its courses and field work. New educational offerings that pointedly explore the challenges and opportunities inherent in "green" development are also being created.