Checklists Legal Topics Real Property Law

Should You Build Green?

168717439As public concern about the effects of human activity on the environment has grown, so too has the interest in green building. And that interest is well-directed, because a Climate Action Team report (.pdf) has identified buildings as the second largest end-user contributor to greenhouse gas emissions in California.

The impact of greenhouse gas emissions on climate change and the need to develop better energy management practices has affected both public and private construction. The result has been a wave of “green building” laws. In 2010, the California Building Standards Commission approved the California Green Building Standards Code (CALGreen), which went into effect on January 1, 2011, as part of the California Building Standards Code. 24 Cal Code Regs Part 11. And since 2007, more than 20 California counties and cities have adopted mandatory green building ordinances.

Although the use of recycled materials and the design of more energy-efficient buildings aren’t new concepts for the construction industry, proponents of green building go beyond these ideas. Green building proponents advocate a whole-building approach to construction and seek improvements to all facets of construction practice, including planning, materials, and techniques. The goal of green building is to produce a building that

  1. minimizes impact on the environment,
  2. reduces operating costs, and
  3. improves the overall quality of life for inhabitants and the community.

Green buildings offer new ways of combining innovative options with old technologies. Developers need to consider numerous factors in deciding whether to develop a private or public green building.

The following is a checklist of factors that a developer’s attorney may want to discuss with a client who’s deciding whether to build green:

__ The cost and availability of green materials;
__ The cost and energy savings of developing and operating a green building;
__ Incentives by local and state governments, utilities, and others to promote green building;
__ State and local agency regulations requiring the private sector to develop green building;
__ The market and consumer demand for the sale or lease of developed green property;
__ Ethical considerations and concern for the environment;
__ Attractiveness to lenders and equity investors;
__ Whether green building certification standards are achievable;
__ Competition from other developers who are building green;
__ The availability of experienced design and construction teams and their willingness to take risks (on risk management);
__ Evidence of the business benefits of green buildings;
__ Overriding security or safety considerations that may prevent or affect the developer’s ability to build green;
__ Tax incentives;
__ The availability of favorable loan and insurance products;
__ Quality of construction;
__ Whether the building will be code-compliant in the future if not initially constructed to green standards; and
__ Cost of future capital improvements if not initially constructed to green standards.

Each of these factors is discussed in CEB’s California Construction Contracts, Defects, and Litigation, chap 4. On green building regulations, turn to CEB’s California Land Use Practice, chapter 11.

Related CEB blog posts:

© The Regents of the University of California, 2014. Unauthorized use and/or duplication of this material without express and written permission from this blog’s author and/or owner is strictly prohibited.

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