These are excerpts from a roundtable discussion sponsored byIncisive Media and Williams Real Estate. The full text will appearin the December issue of Real Estate New York magazine.

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NEW YORK CITY-Eighteen months ago, recalled constructionattorney Kenneth Block, discussions about green building tended torevolve around the question of whether the cost and effort werejustified. Now, said a panel of experts Monday evening, everyonefrom tenants to lenders to government is making it all butessential.

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"The state of the art will be green," said Block, partner atTannenbaum Helpern Syracuse & Hirschtritt LLP. "There's noquestion about that." Block pointed out that as part of their morestringent standards, lenders will insist on the-state-of-the-artwhen it comes to financing new construction. Moreover, governmentis leading the way in mandating green standards, he added.

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Noting that the crux of the issue for commercial real estate iscost effectiveness, moderator Robert Freedman said that owners anddevelopers, "no matter how enlightened they are," are stillresponsible to the realities of the marketplace. In a business ofROI and payback thresholds, "Can green be sold effectively in thecontext of this marketplace?" asked Freedman, president and CEO ofWilliams Real Estate, in kicking off the panel discussion.

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Tenant demand can be one factor in answering this questionaffirmatively. "Is there going to be a green market at all?Actually, I think there's going to be more of a green market"because owners will need to differentiate their buildings asvacancy rates slip and tenants have more choices, said Nora Fay,principal of Lehr Construction. Freedman commented, "Enlightenedtenants can legislate enlightened practices."

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Catherine Barton, corporate director of business development atGreen Depot, cited municipalities that have implemented incentiveprograms to encourage sustainable real estate, from the Long Islandcommunities of Babylon and Hempstead to New York City, where theBloomberg administration rolled out its PlaNYC in the spring of2007. Within government buildings, too, the green movement hastaken hold. Panelist Emily Baker, regional administrator of the USGeneral Services Administration, cited a study showing "realresults" in 12 of the sustainable buildings within GSA'spurview.

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Additionally, going green does not always entail a cost premium.Andrew Padian, senior housing specialist at Steve WinterAssociates, said there are many no-cost steps that building ownerscan take. "This is not about cutting-edge technology," said Padian."This is about things that are 20, 30 or 40 years old and mostpeople are familiar with."

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Paul Bubny

Paul Bubny is managing editor of Real Estate Forum and GlobeSt.com. He has been reporting on business since 1988 and on commercial real estate since 2007. He is based at ALM Real Estate Media Group's offices in New York City.