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Making Energy Retrofits Work for Tenants and Owners

Tenant engagement is key to achieving energy efficiency and reducing the carbon footprint of multitenant buildings.

Dana Schneider, Northeast Market Lead, Sustainability Services, Jones Lang LaSalle and Dan Probst, Chairman of Energy and Sustainability Services, Jones Lang LaSalle (June/July 09)

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Motivating Strategies
The Empire State Building team addressed these issues with a set of strategies designed to motivate tenants to share the building’s sustainability goals without requiring participation of any tenant. The program includes:

Pre-built spaces: The team is building out interior spaces with a range of sustainable features, including use of recycled materials, energy-efficient lighting, and maximum use of the building’s unparalleled daylight and views. The spaces are designed for time-pressed tenants to occupy quickly, and for other renewing and incoming tenants to visit in order to understand the aesthetics and economics involved. The pre-built spaces will save $0.70 to $0.90 per square foot in annual operating costs for an incremental cost of $6 per square foot, resulting in a net gain to the tenant over the term of a 10-year lease.

Tenant design guidelines: A set of written recommendations based on the pre-built program help walk tenants through the process of creating sustainable space, which not only saves money but also creates a healthier and more productive work environment for employees.

Sub-metering: As leases are renewed and spaces turn over, the team will install sub-meters in all spaces, and will give tenants the option of either maintaining a per-square-foot system for calculating energy bills, or opting into a pay-for-usage system. Although the owner will still have to pro-rate energy used in lobbies and hallways, the pay-for-usage system will reward tenants that participate in energy efficient strategies with lower costs per square foot than they would otherwise be able to achieve.

Energy and carbon monitoring: Tenants engaged in sustainable initiatives will be able to measure their carbon footprint and see how changes in their space affect their usage and cost by accessing a feedback-and-reporting energy management program developed by the team during the analytical process.

The ability to relocate tenants within the building, even temporarily, as leases are renewed will also help the team complete other projects on an accelerated schedule. For example, the team will refurbish each of the building’s 6,500 windows over the next few years, a process which involves removing each double-pane window, adding a third pane and glazing to enhance its energy efficiency, and replacing the window. The entire process will be done on-site to save transportation costs and associated CO2 emissions, and the re-use of the windows and frames will avoid unnecessary waste being sent to the landfill. At the same time that the window refurbishment is under way, insulation will be added between radiators and exterior walls to further improve energy performance.

The tenant engagement program and the work in tenant spaces are part of a larger initiative that will also address aspects of the building infrastructure and common areas; however, for the Empire State Building to reach its full potential as a highly energy-efficient building, tenant engagement is key.

Signs of Success
Since nearly 40 percent of the building’s space is due to turn over within four years, the success level of the tenant engagement program will soon be evident. Early signs are encouraging: One new tenant is pursuing LEED CI Platinum certification on its commercial interior space, and another tenant is pursuing LEED CI Silver. The building itself is pursuing LEED EB-OM Gold certification, which would make it one of first pre-World War II office buildings in the country to receive such a designation.

Malkin’s hope is that other owners will replicate the Empire State Building program to financially justify whole-building energy retrofits at their own buildings, the ultimate goal being to prompt the reduction of building-related CO2 emissions by thousands of times what one building alone can achieve. Accordingly, he has directed the retrofit team to launch and maintain a web site — www.esbsustainability.com — to share detailed documentation and tools with all interested parties throughout the process. Even if a complete retrofit is not a viable option, however, the tenant engagement program may provide ideas and tools that will help bring owners and tenants together in overcoming obstacles to energy efficiency in multitenant buildings.

Dana Schneider, Northeast Regional Market Lead for Sustainability at Jones Lang LaSalle, serves as program manager of the energy retrofit at the Empire State Building. She can be reached at dana.schneider@am.jll.com. Dan Probst is Chairman of Energy and Sustainability Services at Jones Lang LaSalle. He can be reached at dan.probst@am.jll.com.

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About the Author

Dana Schneider, Northeast Market Lead, Sustainability Services, Jones Lang LaSalle
Dana Schneider is the program manager of the energy retrofit at the Empire State Building. She specializes in energy performance optimization and LEED certification for new and existing buildings, portfolios, and commercial interiors. She has overseen projects totaling more than 6.8 million square feet for clients including HSBC, Diageo, Citigroup, Barclays Capital, Grand Central Terminal, and Deutsche Bank. She can be reached at dana.schneider@am.jll.com.

Dan Probst, Chairman of Energy and Sustainability Services, Jones Lang LaSalle
Dan Probst is Chairman of Energy and Sustainability Services. He oversees approximately 1,200 professional staff worldwide and manages global integration of service delivery across functions such as energy management, energy retrofits, and sustainability consulting. He also serves as Chairman of Jones Lang LaSalle’s Global Sustainability Board. He has led two of the firm’s largest corporate accounts, including a 500-person account team serving a client’s 30 million-square-foot portfolio.

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