It’s Not Easy Defining Green

PHILADELPHIA-Sustainability has moved past the novelty stage, yet its benefits may be most apparent to companies that have made it standard operating procedure. For much of the commercial real estate community, it’s still shrouded in vagueness. “People aren’t necessarily sure about what you mean by ‘sustainability,’ commented Christian A. Bigsby of GlaxoSmithKline Pharmaceuticals.

Yet Bigsby, as GSK’s VP of worldwide real estate and facilities, presides over a companywide commitment to green practices, including an extensive program of reinvestment into capital projects that promote these goals. He and his fellow panelists during Thursday’s “Financial Implications of Sustainability” webinar discussed the greening of real estate from a variety of perspectives: tenant, owner/developer, lender and vendor.

The market downturn slowed momentum in the sustainability movement industrywide, panelists conceded. “It has had an impact, I hate to say it,” said e3bank’s president/CEO, Frank J. Baldassarre Jr. “We took our eye off the ball.” Compared to a year ago, Baldassarre said, “the fear has started to diminish, but we’re not there yet.”

However, John Gattuso, SVP and regional director at Liberty Property Trust, disagreed that sustainability was something to be shelved as an austerity measure. “For the most part, we reject that thought process,” he said. Instead, LPT has focused on the long-term benefits of green practices, and to date has completed 40 projects across its portfolio.

The g-word may be part of LPT’s methodology, but not necessarily its vocabulary. “We try not to use the word ‘green,’ because it allows it to be marginalized,” Gattuso said. “We prefer the term ‘high performance.’ ”

Lee Dinenberg, president of solar panel company SP-One, acknowledged that financing eco-friendly projects has always been a problem. Yet he pointed out that the economics are being driven down by both scale and the rate of installations. “The evolution of sustainability in the past few years has just been phenomenal,” Dinenberg said.

Be that as it may, Bigsby said vendors, developers and occupiers alike need to do a better job of selling the value proposition in sustainability. Baldassarre cited the challenge of defining how the industry can start to monetize environmental assets and get to market-based solutions without the need for providing subsidies as incentives.

Michael McCurdy, market director at Jones Lang LaSalle, moderated the hour-long discussion, a joint presentation of GlobeSt.com and RealShare Philadelphia. To listen to a replay of the August 5 event, available on demand until Nov. 4, click here.