Green Issues in Commercial Office Leases

Part Two of a Two-Part Series

The first part of this series focused on the credits involved with a lease for office space where the client wants to pursue LEED CI Certification and addressed the LEED CI credits one needs to be aware of, by category, with a discussion of the intent behind each credit. The conclusion discusses the questions that should be asked of the tenant and landlord.

Tenant's Questions

A tenant that is seeking LEED CI Certification usually has had some internal discussions about its sustainable strategy. If not, here are some basic questions that a broker or attorney should ask its client up front (if the tenant's management team has not already asked them):

1) Do you want to locate in an urban or downtown area?

2) Is access to public transportation important to your organization?

3) How much parking do you wish to provide to your employees?

4) Will your appliances and equipment at the new location be ENERGY STAR rated?

5) Do you wish to submeter your space and pay your own energy costs?

6) Do you wish to purchase green power for 50% of your energy use for at least two years?

7) Do you want to recycle your construction waste?

8) Are you willing to allow additional time in your construction schedule for indoor air testing?

9) Do you wish to extend your lease for 10 years? If so, how much of your space do you wish to renovate?

A 'no' answer to any one of the questions above will not preclude the tenant's participation in the LEED CI program, but it starts to set limits on the points that can be pursued. This would be a good time for the broker to review a LEED CI checklist with the tenant and discuss the point options. Some brokerage firms may have LEED APs on staff to help with this process during this early stage.

Questions for Landlords

Here are some basic questions that a broker or attorney should ask potential landlords prior to touring buildings or spaces, along with the credit most impacted by the answer.

Prerequisite Questions

1) Does your building comply with ASHRAE/IESNA Standard 90.1-2004? (Energy & Atmosphere Prerequisite 2)

2) Will my tenant's equipment be able to have no CFCs within its space and be compatible with the base building equipment? (Energy & Atmosphere Prerequisite 3)

3) Does your building have a recycling program? What is recycled? Does the building have a place to store and collect recycled items? (Materials & Resources Prerequisite 1)

4) Does your building meet ASHRAE Standard 62-2004 for minimum IAQ performance? (Indoor Environmental Quality Prerequisite 1)

5) Does your building prohibit smoking within the building and within 25 feet of entrances, outdoor louvers, and operable windows, or does the building limit smoking to specific rooms mechanically ventilated? (Indoor Environmental Quality Prerequisite 2)

Credit Questions

1) Does your building provide bicycle storage for 5% of occupants AND changing/shower facilities within 200 yards of the building? (Sustainable Sites Credit 3.2)

2) Will a prospective tenant be permitted to submeter its space and pay its own energy costs? (Energy & Atmosphere Credit 3)

3) Will a prospective tenant be able to purchase green power for two years in its space? (Energy & Atmosphere Credit 4)

4) Could your building comply with ASHRAE Standard 55-2004, Thermal Comfort for Human Occu-pancy (Indoor Environmental Quality Credit 7.1)

5) How does your building's monitoring system (either survey or technical system as per ASHRAE Standard 55-2004, Paragraph 7) integrate into the standard operations of the building? (Indoor Environmental Quality Credit 7.2)

6) Does your building offer green cleaning? (Potential Design & Innovation Credit)

7) In addition, if your client has decided to pursue Sustainable Sites Credit 3.3 Parking Availability, you need to ask the following questions:

a) What is the local minimum parking required by zoning for the amount of RSF in the lease?

b) Does your building offer preferred parking for cars or van pools (except for universally accessible parking spaces) for 5% of the building occupants?

c) If the building provides preferred parking for alternately fueled vehicles, ask how many spaces (percentage wise) are provided.

A 'no' answer to any one of the prerequisite questions above will not preclude the tenant's participation in the LEED CI program. Again, at this point the tenant and its broker need to discuss whether or not they should pursue a lease in that building, given the difficulty the tenant might have in obtaining a LEED certification for its interior work.

Conclusion

It is never too early in the leasing process to start preparing for LEED CI. The right building/space is important to the eventual success of the project. The tenant's management team should discuss and prioritize internally what is important to the organization with regard to sustainability issues. The team should discuss green expectations and the consequent cost implications upfront. An urban site in a new building with efficient HVAC, while beneficial in the LEED CI Program, will have rental cost implications, depending on that favorite adage of the real estate industry: location, location, location. The six point categories in the LEED CI allow enough flexibility for the team to find the building/space that will best suit the tenant's particular needs while incorporating green standards into its office space.

Elizabeth L. Cooper is Senior Vice President and counsel and Frank Mobilio is an architect and construction manager with The Staubach Company, in Washington, DC.

Part Two of a Two-Part Series

The first part of this series focused on the credits involved with a lease for office space where the client wants to pursue LEED CI Certification and addressed the LEED CI credits one needs to be aware of, by category, with a discussion of the intent behind each credit. The conclusion discusses the questions that should be asked of the tenant and landlord.

Tenant's Questions

A tenant that is seeking LEED CI Certification usually has had some internal discussions about its sustainable strategy. If not, here are some basic questions that a broker or attorney should ask its client up front (if the tenant's management team has not already asked them):

1) Do you want to locate in an urban or downtown area?

2) Is access to public transportation important to your organization?

3) How much parking do you wish to provide to your employees?

4) Will your appliances and equipment at the new location be ENERGY STAR rated?

5) Do you wish to submeter your space and pay your own energy costs?

6) Do you wish to purchase green power for 50% of your energy use for at least two years?

7) Do you want to recycle your construction waste?

8) Are you willing to allow additional time in your construction schedule for indoor air testing?

9) Do you wish to extend your lease for 10 years? If so, how much of your space do you wish to renovate?

A 'no' answer to any one of the questions above will not preclude the tenant's participation in the LEED CI program, but it starts to set limits on the points that can be pursued. This would be a good time for the broker to review a LEED CI checklist with the tenant and discuss the point options. Some brokerage firms may have LEED APs on staff to help with this process during this early stage.

Questions for Landlords

Here are some basic questions that a broker or attorney should ask potential landlords prior to touring buildings or spaces, along with the credit most impacted by the answer.

Prerequisite Questions

1) Does your building comply with ASHRAE/IESNA Standard 90.1-2004? (Energy & Atmosphere Prerequisite 2)

2) Will my tenant's equipment be able to have no CFCs within its space and be compatible with the base building equipment? (Energy & Atmosphere Prerequisite 3)

3) Does your building have a recycling program? What is recycled? Does the building have a place to store and collect recycled items? (Materials & Resources Prerequisite 1)

4) Does your building meet ASHRAE Standard 62-2004 for minimum IAQ performance? (Indoor Environmental Quality Prerequisite 1)

5) Does your building prohibit smoking within the building and within 25 feet of entrances, outdoor louvers, and operable windows, or does the building limit smoking to specific rooms mechanically ventilated? (Indoor Environmental Quality Prerequisite 2)

Credit Questions

1) Does your building provide bicycle storage for 5% of occupants AND changing/shower facilities within 200 yards of the building? (Sustainable Sites Credit 3.2)

2) Will a prospective tenant be permitted to submeter its space and pay its own energy costs? (Energy & Atmosphere Credit 3)

3) Will a prospective tenant be able to purchase green power for two years in its space? (Energy & Atmosphere Credit 4)

4) Could your building comply with ASHRAE Standard 55-2004, Thermal Comfort for Human Occu-pancy (Indoor Environmental Quality Credit 7.1)

5) How does your building's monitoring system (either survey or technical system as per ASHRAE Standard 55-2004, Paragraph 7) integrate into the standard operations of the building? (Indoor Environmental Quality Credit 7.2)

6) Does your building offer green cleaning? (Potential Design & Innovation Credit)

7) In addition, if your client has decided to pursue Sustainable Sites Credit 3.3 Parking Availability, you need to ask the following questions:

a) What is the local minimum parking required by zoning for the amount of RSF in the lease?

b) Does your building offer preferred parking for cars or van pools (except for universally accessible parking spaces) for 5% of the building occupants?

c) If the building provides preferred parking for alternately fueled vehicles, ask how many spaces (percentage wise) are provided.

A 'no' answer to any one of the prerequisite questions above will not preclude the tenant's participation in the LEED CI program. Again, at this point the tenant and its broker need to discuss whether or not they should pursue a lease in that building, given the difficulty the tenant might have in obtaining a LEED certification for its interior work.

Conclusion

It is never too early in the leasing process to start preparing for LEED CI. The right building/space is important to the eventual success of the project. The tenant's management team should discuss and prioritize internally what is important to the organization with regard to sustainability issues. The team should discuss green expectations and the consequent cost implications upfront. An urban site in a new building with efficient HVAC, while beneficial in the LEED CI Program, will have rental cost implications, depending on that favorite adage of the real estate industry: location, location, location. The six point categories in the LEED CI allow enough flexibility for the team to find the building/space that will best suit the tenant's particular needs while incorporating green standards into its office space.

Elizabeth L. Cooper is Senior Vice President and counsel and Frank Mobilio is an architect and construction manager with The Staubach Company, in Washington, DC.