Unlocking Hidden Value in Class B and C Office Buildings
Unlocking Hidden Value in Class B/C Office Buildings: Best Practices for Pursuing Low-Cost, High-Impact Energy Efficiency and Green Leasing Strategies is the first study of its kind, offering guidance and strategies for implementing energy efficiency and green leasing measures specifically tailored to the owners and operators of Class B and C office buildings.
Compared to their Class A counterparts, Class B and C office properties typically are older buildings with fewer technologies in place. While owners and operators of these properties are often eager to enact sustainability strategies, they can be constrained by smaller budgets, limited staffing and the high demand of day-to-day operational needs. As a result, Class B and C buildings often trail Class A buildings in adopting energy efficiency strategies and green leasing provisions. However, they also are the asset class with the most to gain from these measures. Per this report, these untapped sustainability opportunities have the potential to:
- Reduce operating expenses for a Class B or C building by between $0.26 and $0.61 per square foot;
- Increase net operating income (NOI) for Class B or C properties by between 2.4 percent and 5.6 percent per year; and
- Boost Class B or C property value by approximately $5 to $11 per square foot.
This research was supported with funding from BOMA International and Yardi and created in partnership with the Rocky Mountain Institute (RMI) and the Urban Land Institute (ULI).