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The influence of energy considerations on decision making by institutional real estate owners in the U.S

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  • Christensen, Pernille H.
  • Robinson, Spenser J.
  • Simons, Robert A.

Abstract

Large bodies of literature investigate the energy and resource impact of green buildings on consumers, environment, rent and society. However, little research exists that examines the habits and decision-making preferences of owners who operate and invest in these buildings. Industry interviews with senior-level representatives of U.S.-based institutional real estate owners (e.g. REITs, Pension Funds, Opportunity Funds, and Investment Managers) were conducted to assess energy reporting, data tracking, labeling preferences and upgrade decision making. The interviews revealed that EnergyStar and GRESB are primary reporting outlets, with LEED also relevant. Energy tracking mechanisms were quite disparate, ranging from custom built systems, EnergyStar Manager, third party providers or limited tracking. Upgrades were primarily driven by cost-benefit analysis and not sustainability-related motivations. This research shows that energy efficiency and tracking mechanisms have become the norm for institutional owners and investors.

Suggested Citation

  • Christensen, Pernille H. & Robinson, Spenser J. & Simons, Robert A., 2018. "The influence of energy considerations on decision making by institutional real estate owners in the U.S," Renewable and Sustainable Energy Reviews, Elsevier, vol. 94(C), pages 275-284.
    • Handle: RePEc:eee:rensus:v:94:y:2018:i:c:p:275-284
    DOI: 10.1016/j.rser.2018.05.061
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    References listed on IDEAS

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    Cited by:

    1. Petkov, Ivalin & Mavromatidis, Georgios & Knoeri, Christof & Allan, James & Hoffmann, Volker H., 2022. "MANGOret: An optimization framework for the long-term investment planning of building multi-energy system and envelope retrofits," Applied Energy, Elsevier, vol. 314(C).
    2. Gui, Xuechen & Gou, Zhonghua, 2021. "Understanding green building energy performance in the context of commercial estates: A multi-year and cross-region analysis using the Australian commercial building disclosure database," Energy, Elsevier, vol. 222(C).
    3. Lai, Yuan & Papadopoulos, Sokratis & Fuerst, Franz & Pivo, Gary & Sagi, Jacob & Kontokosta, Constantine E., 2022. "Building retrofit hurdle rates and risk aversion in energy efficiency investments," Applied Energy, Elsevier, vol. 306(PB).

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    More about this item

    Keywords

    Q01; Q56; R30; R33; Commercial real estate; Sustainable buildings; LEED; EnergyStar; Interview method; Investment; Green buildings; Energy performance;
    All these keywords.

    JEL classification:

    • Q01 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - General - - - Sustainable Development
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth
    • R30 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - General
    • R33 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - Nonagricultural and Nonresidential Real Estate Markets

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