On May 26, Better Buildings announced an historic partnership with The CoStar Group, one of the largest providers of information to real estate decision makers in the country, to increase the visibility of energy performance data in CoStar’s online property database. CoStar will collect energy performance information such as ENERGY STAR Score, whole-building energy use intensity, and greenhouse gas emissions from the 16 (and counting) jurisdictions with public energy benchmarking and disclosure mandates, and display this publicly available information for its users including tenants, brokers, investors and buyers.
For the commercial real estate industry, increased transparency regarding energy performance is a necessary step to drive further investment in energy efficiency. Communicating this information will jumpstart the demand for high-performing commercial buildings; allowing tenants to target energy-efficient space during leasing decisions, providing data to make informed investment decisions about energy performance risk and opportunity, and encouraging underperforming buildings to invest in energy efficiency to keep pace with market dynamics.
As Cliff Majersik, Executive Director for the Institute for Market Transformation puts it, increased transparency will create a “virtuous cycle of competition that can help drive market transformation as owners increasingly compete to make their buildings more efficient and thereby raise the average level of efficiency of all buildings, saving money for landlords and tenants, and reducing pollution from energy consumption.”
As part of the agreement, the Department of Energy and CoStar will also collaborate on research that evaluates the impact of sustainability and energy efficiency on building valuation, financial performance, tenant attraction, health, and wellness, and other topics. Preliminary evidence already connects improves energy performance to high rental and occupancy rates, lower utility costs, and increased sales prices and the research facilitated by this agreement will cement the business case for energy efficiency by clearly demonstrating that energy performance drives financial performance in commercial buildings.
The DOE-CoStar partnership was applauded by both the public and private sectors, including the District of Columbia Department of Energy and Environment; U.S. Green Building Council; Institute for Market Transformation; Business Council for Sustainable Energy; and the National Electrical Manufacturers Association.