As sustainability becomes less of an outlier in commercialtransactions and elbows its way from a notion in the zeitgeist andto a fundamental requirement, the road will be fraught with lostopportunities or over-valuations of green. Cecelia Bonifay, chairof Akerman Senterfitt's Green & Sustainability practice is theperson to come to when facing down a green future. She sits downwith GlobeSt.com to discuss legal issues, public sentiment and thefuture of monetizing the green movement in commercial realestate.

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GlobeSt.com: What do you handle the most with yoursustainable practice?

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Bonifay: We started our practiced a little overtwo-and-a-half years ago when we saw a demand from our clients tobecome more knowledgeable and have a better point of reference interms of green and sustatinable development. So the way we'reorganized internally, I primarily deal with the built environmentand in the periphery also deal with renewable energy, and a numberof other, clean energy green issues.

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So we work closely with large scale, national developers asthey're looking at changing their corporate practice areas so thatmost large corporations now have a corporate responsibility personthat is doing, green or sustainability investment. You have majorfolks at high levels looking at this and some of the leaders in theindustry on the real estate side have been CB Richard Ellis, JonesLang LaSalle, Hines Developers, etc. Anything on a large-scaledevelopment to an individual building.

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GlobeSt.com: What are you seeing as the largestchallenge? The size? The accessibility of sustainablematerial?

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Bonifay: There are a number of them. I thinkthe biggest challenge today has been the economy and the lack ofcapital and so that has put on hold a lot of new construction. Whatwe are seeing though is there has been financing available for alot of folks out there, especially in office space. If you want tohave class A office space, people believe that they have to greentheir buildings if they want to stay competitive in the leasingmarket, but I think everything has come down to the availability ofcapital.

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I don't think on the materials side that that is as big aproblem here in the US than it may be in some of theseinternational developing markets, where they may not have access tothose materials yet. But it requires a whole new approach to thedevelopment process. In a way its thinking about things, all theway from the engineers to the architects to the general contractorto the vendors that are supplying the materials. And a differentway of building and maintaining things onsite. So it's a wholecontinuum.

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That in turn has fueled the whole certification process throughgroups like US Green Buildings Coalition, etc. So, you now areseeing more requirements for certification for all types ofprofessionals that are involved, because if you want to get acertification for a building, you need to be planning it that wayfrom the very beginning. So that you get the required number ofpoints and you can get to that level of certification.

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Economic incentives are important, because of the lack ofcapital in the market. I'm part of an economic incentives group atthe firm seeing how we can layer federal or state programs togetherto make the difference in financing the necessary money to move aproject forward or not.

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GlobeSt.com: Do you think the economy is drivingmore sustainable practices?

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Bonifay: Yes. This is an interesting thing whenwe did a national real estate summit in March and we did somesurveying of our audience, because we were seeing other nationalreports that were saying they really thought the cost of goinggreen was a deterrent. Our participants really did not feel thatway. They thought the energy savings and the benefit to the bottomline were actually driving them to undertake the sustainabledevelopment practices because it just made good business sense andthe difference in cost was very minimal.

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When you look at the payback, the timeframe has gotten muchshorter. Originally people would be talking about it being $10-$15more per square foot and you'll get it back over 15-20 years. Nowyou're talking about cents per square foot with a payback of 3-5years.

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GlobeSt.com: It's still been hard to figure out themonetary value of it in the short term. How do you find that pricepoint to green a building?

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Bonifay: What's necessary is to get the dataand information out; so that there's enough of a history and atimeline on these projects that they can actually determine what isthat dollar value. The other thing is the Department of Energy hasa huge program now. And they're looking at just analyzing themetrics of in a commercial marketplace. USGBC is tied into that.We're getting that data in that's going to convince the averagelandlord out there that this does make good sense. With CBRE orJLL, they manage millions of square feet around the globe and theyhave bought into this whole heartedly and are actually providing atraining component through one of their key folks who goes out towork with various developers. I think we've just been behind thecurve a little bit in Florida.

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GlobeSt.com: You said FLA seems to be behind some ofthe other out-front states, why do you think Florida is draggingits heels?

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Bonifay: CA is having a lot more work at thelocal level, but also at a state level where there's legislationthat requires certain standards. We've seen that more in Virginia,Maryland, New York because they are a huge city-state, but theyhave fostered legislation in the past. We aren't seeing that at thestate level in Florida. But we are seeing a lot of interestinginitiatives that are coming out of local governments. And b/c it'sthe right thing to do, right here in Orange County, they have anOrange to Green initiative, a lot of local governments are doingtheir own regulation.

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GlobeSt.com: So, at more statewide initiatives,you're looking at more city and district-basedinitiatives.

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Bonifay: Yes, in the state there has been somemoney out there, but not as much because in the past everyonewanted to be in Florida, so we didn't have to worry about some ofthe economic incentives that have been a big component ofdevelopment in the northeast and the Atlantic coast, primarily.

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GlobeSt.com: Do you think it's essential to havecontrols that monitor savings so they can immediately measuremetrics?

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Bonifay: Yes, I think that's going to be thenext step because I don't think it can be "I think we're doing thisamount." Right now we're seeing the ability to actually monitorthat, so that companies can see how much more energy efficient theyare.

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There are also companies out there that are specializing in thisbecause they come in and do an analysis of your existing buildingand they tell you what's needed, then they give you theirprojection on your cost savings and they're only going to get paidunless you realize those savings.

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Some things are easier to do than others. The energy area iseasier to measure, but another whole component is production ofworkers based on the space that they're in or the light allowedinto the building. The Hearst Building in New York City was a hugeundertaking and they fit a new structure over a historic structure,so there were a lot more complications, but they've actually put inthe measurements and the metrics, that building has been open threeyears now…and they were on our green panel saying, "I'm not one ofthese goofy environmental guys, I'm a businessman and this is whatit has meant for us." And even showing what it's done for employeeproductivity. Investments are in people, but if you can get themless sick days, but that's harder to measure.

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GlobeSt.com: There are some buildings going out ofdate, big box retailers that have gone out of business and outdatedindustrial buildings. Do you see more of this becoming conversionsor do you see more knocking these buildings down and putting up newsustainable buildings?

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Bonifay: I think that's the real question rightnow. That is the equation that a number of these folks are goingthrough. "Do I do the renovation and do it as a sustainablebuilding" b/c I think most people believe that that's where themoney is and that's what tenants are going to want. Or really sitdown and pencil it out, should they redo what they've got or knockit down because it's so antiquated and not appropriate for aretrofit. And just start over with a LEED certified shell and letthe tenants get a LEED certified interior and let them finish itout.

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And I think in a number of cases, if the location is right andthe value is in the property, then it may be more cost effective toknock down the building and start over…. Retrofit where it makessense where you have that property values. I think that's whatyou're seeing with a lot of the new stuff overseas and that's whatyou're seeing in India and China right now. I think it's theunderlying value of the property and the location, which is inlarge part going to drive that decision. The age and the quality ofthe construction.

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