Green Building is all the rage. From the latest version of LEED, LEED 3.0, to discussions of “LEEDigation.”

The blogs have been crackling for several weeks with reports and analysis of the LEED “challenge” process.  Chris Cheatham devoted a multiple part series to analyzing the challenge filed and ultimately rejected to the LEED Gold certification awarded to the Northland Pines High School in Wisconsin.  Shari Shapiro has discussed the same and included an interesting interview with the challengers discussing their reasoning for the protest.

Without getting too bogged down in the technical details of the Northland Pines case that are covered elsewhere, I would highlight a couple important takeaways from what we have learned from the Northland Pines challenge case:

1. Currently, anyone can file a challenge – there are no standing requirements whatsoever.  If anyone can file a challenge, the threat to projects, and to LEED, is that anyone will file a challenge.
2. There are very loose/limited guidelines or rules on procedure, hearings, document and information exchange and the like in the challenge process.  Look for a future revamping adding more clarity in the challenge process rules.
3. It appears that USGBC permitted Northland Pines to correct, amplify and update its submittals during the challenge process to demonstrate compliance with the prerequisites.  USGBC needs to make clear whether certification requires bright line compliance based on initial submittals and information, or whether they are more interested in allowing some wiggle room as long as the project meets the standards at the end of the finish line.  Failing to make this basic philosophical tenet clear is not fair to project participants, opens the process to future inconsistency during later challenges, and ultimately threatens the credibility (and thus potentially the viability) of the USGBC process.
4. Last point, which may be the biggest and has not really percolated as a point of focus: as currently conceived, the LEED challenge process adds another completely unpredictable line item expense to the process.  The challenge process may also add another angle of attack on projects for unhappy losers in bidding, neighborhood NIMBY uprisings, and competitors that may want at low cost and effort to financially damage their opponents. At least courts have a theoretical sanctions approach to address complaints filed in bad faith.  USGBC should strongly consider adopting rules that require a USGBC member to certify the challenge as being in good faith, along with membership penalties or sanctions for individuals signing off on complaints that have zero merit.

The challenge process in theory may add an important element of credibility, verification and transparency to LEED certifications.  As it stands though, there are loose rules, no standing requirements, and one can easily file challenges even in bad faith without facing any impact.  If we start seeing a rash of such challenges, we may start also seeing a growing movement away from LEED certification due to increased unpredictability.  The current challenge structure presents some serious risks and issues moving forward and needs to be the subject of significant thought and retooling to avoid future problems.

From NY Times | Making History In a Brooklyn Neighborhood

When Habitat for Humanity New York City consulted an architecture firm on its new site in the Ocean Hill section of Brownsville, Brooklyn, it received a response that switched on a light bulb. The firm, Dattner Architects, said that Habitat could proceed with its plan to build 12 town houses on the trash-strewn vacant lot, but that the site was actually capable of supporting many more units in apartment form — 41, to be exact.

The result, nearly three years and one entirely new development model later, is the largest creation in Habitat’s history, an $11.6 million three-building complex on Atlantic Avenue, complete with LEED Gold certification. About 10,000 requests were received for the 41 slots; the applicants eventually selected were required to make down payments of 1 percent on the building’s condominiums, which ranged in price from $75,000 to $200,000. They were also required to invest 300 hours of work, which Habitat, a nonprofit organization, calls “sweat equity,” in the development.

“In the past, they were building single-family dwellings, not a 41-unit complex as they did here on Atlantic Avenue,” said Rosalyn Jolly, a hospital clerical associate who recently moved from a cramped one-bedroom in Bushwick into a two-bedroom in the complex with her 15-year-old daughter. “It’s a wonderful thing.”

Now, perhaps with the notion that it is onto something, Habitat has begun altering its model in New York City. The volunteers so often photographed putting up the walls of a standalone house, sometimes with a smiling Jimmy Carter in tow, are now helping erect larger buildings (alongside future residents). And the city’s branch of Habitat just learned last week that it will receive about $10.5 million in funding from the federal Department of Housing and Urban Development, part of a $2 billion outlay to help nonprofits and governments expand their services for affordable housing.

In the South Bronx, a 50-unit co-op building on Fox Street is mostly finished, and in February, Habitat will begin taking applications for a development a few blocks away. The 63-unit building on Prospect Avenue at Macy Place, for which final city approval was recently granted, is rising above the neighborhood, visible from the elevated train platform of the 2 and 5 subway lines down the street. Volunteers are to start work there in March.

“New York is a very dense city,” said Ingrid Gould Ellen, a professor of public policy and urban planning at New York University’s Wagner Graduate School of Public Service. “So I think that building to the density levels that fit into the neighborhood landscape makes a lot of sense.” The affordable-homeownership market, she said wryly, “is not a market that is glutted right now.”

Yet Habitat is taking on this new role of low-income condominium developer at a difficult time for such housing in New York. In fiscal year 2009, a 16-unit Habitat development in Bedford-Stuyvesant was the only below-market-rate homeownership deal to close with the city’s Department of Housing Preservation and Development. (In 2008, the total number was 24; in 2007, 27.) While Habitat works in ownership situations, the rental market is also struggling; the number of affordable units available per 100 extremely low-income households in New York State fell to 36 from 38 in 2008, according to theNational Low Income Housing Coalition.

This situation exists despite Mayor Michael R. Bloomberg’s $7.5 billion affordable-housing initiative, created in 2003, which seeks to “create or preserve” 165,000 units. With 97,000 units financed thus far, according to the housing agency, the plan is on track to meet its goals by 2014, but demand remains high; the city’s vacancy rate is 2.9 percent.

In this environment, Habitat has tripled its number of units under construction in the past six months — thanks in part, it says, to its sweat-equity ownership model.

“Ideally, in our quest to serve as many families in need as possible, what we want to do is to be as nimble and as entrepreneurial as possible,” said Josh Lockwood, Habitat’s executive director in New York City.

Applicants, 90 percent of whom are typically rejected quickly, must submit to a home visit and interviews as well as maintain a 620 credit score. Under a loan agreement between Habitat and the State of New York Mortgage Agency, buyers putting in 300 hours of work on their buildings receive a 2 percent interest rate, which Habitat buys down to zero percent. In addition to the 1 percent they put down, buyers make monthly payments equal to a third of their incomes.

“We don’t give anything away,” Mr. Lockwood said. “These families have to build their own homes.”

The cost of building for Habitat is reduced further by fund-raising and the large pool of volunteers. Of course, given market conditions and land availability in the city, not every new endeavor can be as ambitious as the Ocean Hill complex.

In the Bronx, Habitat’s two new buildings are partnerships with the Blue Sea Development Company, which has worked with the city on affordable housing in the past. That means about three-quarters of the units will not be sold under the Habitat sweat-equity terms described above — although they will still be sold below market rate, and are therefore considered affordable housing. Indeed, the word “Habitat” isn’t in evidence on the banners on those buildings (the words “Affordable Housing” are); Habitat says it is marketing its share of the units through its normal means.

“The hope is that we can use both models,” Mr. Lockwood said.

Either way, new residents are happy. Taking a group of visitors through her family’s earth-toned two-bedroom at Atlantic Avenue, Mirian Rodriguez spoke with pride, and some surprise, about the construction skills she had learned over the last year.

“I knew what Sheetrock was, but I didn’t know how to put it in,” she said. “You had to be on your knees.” She works part time at Jamaica Hospital; her husband, Miguel Baez, works as a porter in Manhattan.

Their place is filled with new appliances, a gift from her parents (“It was on sale,” she says), along with a big-boy bed for her son, Adrian, and all the Hot Wheels paraphernalia that can fit in one child’s room. It’s a far cry from the tiny one-bedroom they rented in Cypress Hills, Brooklyn, with crime and commotion in the hallways. The new place is quiet and comfortable, and it smells good.

“We’re very thankful,” she said. “It’s ours.”

Full | Making History in a Brooklyn Neighborhood

I recently had the opportunity to sit in on an Alcholics Anonymous meeting. Limited Disclosure: Who I was in the meeting for is private, hence the ‘anonymous’ but I will share that I am not in recovery, just an interested, supportive third party.

One lesson from the meeting really stuck in my mind. It’s a simple concept.

“Progress, Not Perfection”

Put simply, the idea is that a recovering alcoholic is going to falter on the road to sobriety. What AA encourages is continual effort toward becoming sober for life, because as they also acknowledge being an alcoholic is something you are not something you “have.” The concept encourages continual improvement, instead of a light-switch, where one turns off their desire for alcohol and never turns it back on.

I left the meeting and that simple phrase kept turning around and around. I wonder if the green movement in total, and the green building movement specifically, could you a dose of this thinking. I often read on professional boards and blogs about the dilemma of asking clients to take sustainability measures when they are not perfect solutions.

“How can we ask them to switch to fluorescent when there is Mercury?”
“How can we ask them to switch to solar, when the waste stream isn’t managed?”
“How can we recommend LEED accreditation when, the NY Times posts articles doubting LEED’s effectiveness?”

It’s not that each of these questions don’t have merit, they do. Solving these kinds of problems through the development of best practices is something Build2Sustain is committed to. That said, the perfect cannot continually be enemy of the good. Apply the “progress, not perfection” mantra and we’ll see forward movement when it comes to increasing efficiency and therefore the sustainability of the built environment.

Does that make a perfect a building stock? No, of course not. To create one would be the life’s work of every design/build professional, but it’s a start.

Progress, Not Perfection.

Let’s get to work. 

A recent post by my friend Andrea Goldman raises the interesting question of “why bother with LEED certification”? The post highlights a recent profile on the highly sustainable Hutton Hotel project in Nashville which elected to forego seeking LEED registration and certification. In particular, Hutton Hotel representatives are quoted as saying:

Doing the government documents alone cost $50,000. Also, the paperwork is so complicated you have to hire an expert to do it. They make the certification a little onerous so everyone won’t pile on. You also need engineers that do testing. It’s a whole process.

If the goal truly is to develop more sustainable, energy efficient and better performing buildings, perhaps that is where a project’s generally limited resources should be directed. The question is how less technically savvy owners, developers, and even perhaps government officials are able to evaluate how “green” are these buildings. USGBC has been able to carve out a niche and indeed expand that niche into widespread identification of LEED being synonymous with green building and presenting LEED as the most credible source of third party validation of green design and construction.

The questions raised by Hutton Hotel are not unique. Indeed, last week I had a long conversation with a longtime client who builds very upscale homes. He remarked that their design and building practice had “been what people are calling green now” for years. He added that LEED did not make sense for them because of its lack of teeth regarding energy performance. These comments echo the themes of earlier discussions regarding critiques of LEED and energy performance, its efforts to incorporate post-occupancy energy reporting, and the changes in credit emphasis in LEED 3.0.

In the end, the ability of LEED to succeed relies upon its stance as an accepted source for third party validation is critically dependent on its ability to maintain credibility. It is for this reason that the recent critiques of energy performance of LEED certified buildings and the USGBC’s efforts to address energy performance issues are so important to USGBC’s long term success. It seems to us that in addition, third party validation relies in part on the market necessity to “prove” a project is green rather than having a knowledgeable marketplace already in position to make that evaluation on its own. As marketplace knowledge and information improves, perhaps the need for third party validation begins to erode over time.

Originally published at Virginia Real Estate, Land Use and Construction Blog.

Image from FreeFoto

by Christopher Hill

Much discussion has centered around the de-certification aspect of the energy reporting requirements of the new LEED guidelines.  However, as I have been reading and commenting on the proposed energy reporting requirements found in the latest LEED certification guidelines, and looking at the issue through the eyes of Eeyore (my favorite A. A. Milne character), I realize that my biggest issue with the reporting requirement is a broken window problem.

No, not the Broken Window Fallacy first set out by Mr. Bastiat years ago.  The problem I am talking about is not the illustration of an economic theory, but a practical issue I see with the use of long term energy reporting.

Once this energy data is out there (and it will be because what’s the point of building a LEED Platinum building just to have it de-certified?), owners and governmental entities will use it and make it a part of their contracts or regulations.  It is at this point that broken windows become a problem.

In short, what happens if a kid breaks a window or someone leaves a door open?  Despite training and lectures, humans make mistakes.  Who’s fault is it when such a problem (totally unrelated to design or construction) causes the building to fail to meet an energy reporting standard a year or more after construction?

I feel that these sorts of relatively straightforward issues must be dealt with if sustainability and “green” construction is to take hold.  I also feel that attorneys, architects and other construction professionals should work together to deal with them before the trouble occurs.

The legal blogosphere has been active recently with discussion of the recent article in the New York Times critical of LEED. The article in essence uses the example project of the Federal Building in Youngstown, Ohio as a sample for LEED projects that fail to be “green”. The Times in particular attacks the actual energy performance of a specific project as an example of why the LEED certified project is not in fact green. Reaction has been varied, from Shari Shapiro pointing out these discussions have been in the mix for some time to an impassioned, relatively emotional, reaction from Rob Watson, a board member of USGBC and significant national player in the green movement. Chris Cheatham has pointed out for discussion the interplay between green building success on the one hand and risk associated with projects receiving funding under the American Recovery and Reinvestment Act. Before we move on to the bigger picture, the article deserves the specific focus on the example project, called by the Times the “Federal Building”, but more properly known as the Nathaniel R. Jones Federal Building and US Courthouse (Youngstown, OH).

After first glance, the Times article raises more questions than it purports to answer. The article states, “[T]he building is hardly a model of energy efficiency. According to an environmental assessment last year, it did not score high enough to qualify for the Energy Star Label[.]” A review of the GSA study on its website reveals a few interesting facts that the Times left out of the article:

• The GSA study was of 14 first wave green GSA buildings ; 8 were LEED certified, 2 were LEED registered, one used Green Building Challenge, and three were designed with an emphasis on energy efficiency
• The Federal Building project did not seek any credits for energy efficiency under EA Credit 1. Similarly, the project did not seek points for additional commissioning, measurement and verification, or green power
• While the Federal Building project did not receive the 75 score required to qualify for Energy Star, it did in fact reach a 58 despite the fact the building did not even try for the energy efficiency credits. Every other GSA project contained in the study qualified for Energy Star

So how did a project that is alleged by the Times to have a “major gas guzzler” of a cooling system reach LEED certification in 2002? A review of the GSA’s webpage describing the project, and further discussion at BuildingGreen.com, reveals that the site is a downtown redevelopment of a previously paved site. The project included restoration and planting with native and adapted vegetation and reduction of impervious area by a whopping 58%. The project reduced ozone depletion by use of HFC refrigerants and the fire suppression system includes no halons. Over 72% of project waste was recycled and the project used structural steel with 90% post-consumer recycled content. Over 62% of the project’s building materials were manufactured locally.

The New York Times’ focus on the Federal Building project does bring a couple of key themes into focus. First, “green” is not the same to everyone. Indeed, Build2Sustain has had a fascinating discussion on-going on its blog and also on its various members blogs and twitter accounts comparing use of “green” and use of “sustainable” terminology. The use of loose labels where everyone does not agree on a shared meaning can create misunderstandings. Green does not necessarily mean energy efficient as there are plenty of areas allowing points under LEED that can in fact inhibit energy efficiency.

Second, the project used as the centerpiece of the article was completed in September 2002. LEED has come a long way since then and trying to extrapolate structures that were designed roughly ten years ago and apply that to current conditions may be suspect.

Finally, the USGBC has in fact already taken steps to address these issues. The new LEED 2009 standards incorporate a shift in greater emphasis towards energy efficiency in particular. Further, USGBC is taking steps to require on-going reporting and has indeed discussed using decertification as a means to require on-going compliance. (Please visit Matt Devries’ blog for an excellent recap of the commentary that erupted when the decertification discussion first broke several months ago).

In summation, it appears like the NYT dug and found an example of an old project to raise objections that the USGBC has already been addressing with LEED … in short, they are perhaps trying to resurrect the Ghost of LEED Past.

Note: This post is reprinted from the Virginia Real Estate, Land Use and Construction Law Blog.  This is a companion piece to LEEDing to Unintended Consequences – The Ghost of LEED Future reprinted recently here at Aribra.

If you were to ask three different people the definition of sustainability, you’ll receive three different answers; this is ours.  Business structures are moving away from models based solely on economic returns and are now considering the environmental and social returns as well. The tides are shifting.

From Mother Nature Network | Sustainability: What does it really mean?

We are perhaps transitioning from a communications age to one of sustainability.

It is the buzzword of today, used in reference to the environment, economy, development, health care, food and more. During his address last month to Congress on health care, President Barack Obama said, “our health care system is placing an unsustainable burden on taxpayers.” He is working to restructure our economy around sustainability and “green” jobs rather than manufacturing and finance as in the past.

The Dow Jones Sustainability Index now tracks the financial performance of leading sustainably driven companies worldwide. We see the ideal in the construction of our homes and businesses. Colleges and universities now are creating environmentally sustainable campuses and adding courses that reflect students’ new belief that their futures will be driven by the ideal, says Dr. Shana Weber, sustainability manager in the Office of Sustainability at Princeton University. At Princeton alone, 51 courses now address sustainability in some way, in subjects such as the economy and energy.

We use the word so much, but do we really understand what it means? Is the word so overused it is in danger of losing its meaning?

Sustainability refers to everything

The word carries a “green” connotation, but really everything is connected, says Nancy Gabriel, director of the Donella Meadows Leadership Fellows Program at the Sustainability Institute in Hartland, Vt. A world in which the environment is pristine but poverty is rampant is not sustainable. She believes the definition includes three components: the environment, economy and social justice.

“It is truly an all-encompassing word,” Weber says. “We have to look at business structures. We have to look at social structures. We have to look at almost every aspect of how we live. And so that seems overwhelming, but that’s really what it’s about. What can we do to stabilize our global environment, social and economic systems?”

The word’s modern meaning dates to 1987. That year the United Nations World Commission on Environment and Development (also called the Brundtland commission after its chair, the Norwegian diplomat Gro Harlem Brundtland) issued a report defining sustainable development as “development that meets the needs of the present without compromising the ability of future generations to meet their own needs.”

In time, a movement began revolving around a word that didn’t carry the negative connotations of environmentalism, Weber says. The LEED green building rating system emerged, making environmentalism more mainstream, and then Al Gore released his film, An Inconvenient Truth. The film was released at “exactly the right moment,” she says. “It was already in the air, and that film really seemed to galvanize something.”

At risk of losing its meaning

Today advertisers and marketers use sustainability to describe nearly everything. Perhaps the word is in danger of losing its meaning. But we also have been shocked by economic collapse and natural disasters such as Hurricane Katrina and the tsunami that devastated South Asia. We have watched water levels rise and glaciers melt. We understand change is necessary. Gabriel wonders whether, in fact, a sustainability age already has passed, whether instead we are entering an age of restoration or regeneration.

“People are feeling that I think our lifestyle of consuming goods, the way our lifestyle is, it has disconnected us from each other,” she says. “People are feeling that and feeling and really looking, wanting something different. And so this, all these kinds of collapses are opportunities really to restructure in different in ways.”

In a country where more is the American way, is sustainability feasible?

Embedded in our identity is a deeply held ambition to push away at boundaries. Early Americans pushed across the Atlantic and declared our independence. Then we pushed across the continent toward the West, crossing the Mississippi River and scaling the Rocky Mountains. We invented cars and planes and reached for the moon. Over time even our houses and food portions grew in size. “Where’s the beef?” we said.

That is why what has happened to our economy is so shocking and painful. The contraction we have experienced is un-American. The discouragement and humility we feel are foreign. Sustainability advocates insist they do not mean for us to lower our standard of living, but rather they want us to understand that less of many things taken together actually can lead to a better life.

Sustainability is a concept we are drawn to because it offers hope, Weber says. It makes us believe we can have both less and more at the same time, that our problems are surmountable, and the solutions lie within us.

“I think we have to shift away from this industrial growth model,” Gabriel says. “I really think there is a way to look at how to do development that’s more focused on well-being and not on this consuming of goods.”

Full | Sustainability: What does it really mean?

The USGBC has imposed extended reporting requirements as part of its minimum program requirements for LEED. It appears the extended reporting already adopted may only be an initial step. We may see extended reporting requirements backed up by decertification; we may see on-going recertification as a basic part of LEED program structure.  I admit this is speculative, but we may be seeing a shift from LEED using energy modeling towards an actual performance model.

Given the overall goal of improved building performance implicit in LEED, these changes and speculated upon shifts may make sense technically. These changes, however, raise some significant questions regarding risk and responsibility. The ultimate impact on risk, and thus embedded costs, of these changes may vary dramatically from state to state because of each state’s underlying legal framework.  Placing these changes into the complex network of construction contracts, contractual allocations of risk, and shared responsibilities raises some interesting observations and questions:

• States whose limitations period runs based on “injury”, such as Virginia, may experience extended limitations triggers where building performance is alleged to be the failure; such results could be different for the various players depending on their roles
• In damage trigger states, courts may find that “injuries” were suffered far earlier than owners even suffered performance problems, so results in these states are difficult to predict and there could be big winners and losers
• States with discovery based limitations accrual, such as Maryland and the District of Columbia locally, will present cases with ever longer, potentially plausible, arguments regarding why the owner “reasonably did not know” of a problem for years after occupancy of the project
• The timing issues presented by extended performance questions mean that contractual agreements on statute of limitations and when they start to run should be focal points of contract negotiations; negotiations regarding extended warranties will be pivotal as well
• The growing use of LEED certification in various local zoning approvals means decertification may carry unintended consequences. If a project is decertified, is there a possibility that its occupancy permit is threatened?
• The potential for decertification, or a failure to participate in recertification if that becomes standard, may place commercial landlords at potential for extended risk of breaches of lease agreements depending on the LEED requirements imposed
• Lease agreements in turn need to be carefully worded so that all parties are on the same page as to exactly what is the yardstick and time frame for complying with LEED related terms

These are just a few of the wrinkles that come the mind when one places an overlay of extended performance obligations into the context of LEED.  We will keep a close watch on these developments moving forward.  We believe that continued movement on the extended performance axis by USGBC will have some serious economic impact on the financial aspects of LEED projects, who “wins” and who “loses” based on these changes, and where bottlenecks may develop on the economic risk side of the equation in reaction to extended performance obligations.