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BEVERLY HILLS, CA-Green development is more than just a way to save money–it’s rapidly becoming a process that will transform companies and an entire industry, said speakers at the Urban Land Institute conference on “Reinventing Retail and Mixed-Use,” which concluded here on Thursday.

Developers and retailers are looking for ways to make themselves more environmentally friendly, a process that may not be voluntary, given the rapid pace of climate change.

“Everything about the way you’re going to do business is going to change,” said Hunter Lovins, president and founder of Natural Capitalism Solutions, an Eldorado Springs, CO-based sustainability consultancy. “And there is nothing you can do about it.”

California’s water level is about 24% of normal, she noted and the United States’ reliance on important energy has become both a financial and security crisis. Buildings that are not carbon-neutral will quickly become obsolete, she said. In addition, green builders will have access to institutional investors and may even become more attractive to insurance companies.

Retailers and developers are responding: Wal-Mart has told its top suppliers in China that it must reach certain sustainable benchmarks in order to continue a business relationship. And development firms such as Macerich Co. are creating corporate programs to address sustainability, often extensively.

“The easy approach is simple,” said Jeffrey M. Bedell, vice president of sustainability for Santa Monica-based Macerich. “We wanted to transform what we were doing.”

Despite the downturn, Macerich is not cutting back on its energy and sustainability commitments, which range from setting criteria and pursuing LEED certification where practicable–such as at its upcoming Santa Monica Place redevelopment–to web-based suggestion boxes to encouraging staff to implement smaller changes to make conservation a part of their personal lives as well.

Barricades are now made of recycled materials, and the company has created a clearinghouse Website that will allow benches and other items no longer needed by one property to be shipped and reused at another Macerich center.

Such initiatives are encouraged by an industrywide leasing shift from base rent plus additional common area maintenance fees to fixed additional rent, said Lindley H. Miller III, a project manager of urban developer Wilson Meany Sullivan, San Francisco. Under the former, energy savings would be passed on to the tenant, giving landlords little incentive to spend extra time and money to conserve. With a fixed additional fee, landlords “created a situation where they’re very incentivized to do this and get a return on investment.”

Tenants, too, are motivated to save. The Gap, which is in the midst of a major remodeling program, is beginning to incorporate sustainable initiatives in its plans.

“At Gap Inc., whose DNA is about social responsibility, thinking about sustainability is very important,” said Erin Alley, director of Gap Global Store Design, San Francisco, while adding that the chain doesn’t have full control over its stores. “It’s going to be that partnership for us.”

It may be a question of survival, Lovins said. “Frankly, you will go green,” she said. “Or you will cease to exist in the near future.”

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