10 Mistakes Green Developers Make

10 Mistakes Green Developers Make


Have you hugged a tree lately? Of course, it sounds silly, but concern for the planet and the creation of sustainable sources of energy that costs less to generate is creeping into the residential and commercial real estate market throughout the United States.

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Although you may not be aware of it, green is becoming a very important part of the real estate market. According to McGraw-Hill Construction’s 2013 Dodge Construction Green Outlook, green will account for 55 percent of all commercial and institutional construction by 2016; green home and renovation activity is expected to grow 38 percent by 2016; and overall new green construction is expected to reach $204 billion to $248 billion by 2016.

You may or may not be aware that the United States Green Building Council, a non-profit group that promotes sustainability in how buildings are designed, constructed, and operated, has established green building guidelines known as the Leadership in Energy Environmental Design (LEED) Standards. The Requirements cover all aspects of the development and construction process. The Standards have been used in more than 7,000 construction projects in the U.S. and 30 countries.

LEED includes a 100-point scoring system that rates six categories – sustainable sites, water efficiency, energy and atmosphere, materials and resources, indoor environmental quality, and innovation in design. The project’s score qualifies it for one of four levels of certification –- Certified (40-49 points), Silver (50-59 points), Gold (60-79 points), and Platinum (80 points and above).

Mistakes to Avoid

If you plan to be an investor in real estate properties for some length of time, then you should be aware of mistakes that should be avoided when investing in green or sustainable properties. Here are 10 mistakes you should avoid when investing in a green project.

  1. No plan. Getting involved in a green project can be somewhat overwhelming if you don’t draw up a plan of attack before hand. You need to be familiar with the LEED standards, features that are commonly a part of LEED Certified buildings, a contractor who has constructed green buildings, and a budget.
  2. Bad design. This usually occurs when the design is too complicated or too large. Keep the structural integrity, including the foundation and roof, framing, and waterproofing material in mind when creating a design. Also consider passive, climate-specific approaches and resource efficiency of the mechanical systems to assure proficient operation.
  3. Too much green. You don’t want to spend money on something that provides no benefits. Trying to include everything that’s on a green building certification checklist may not be practical for the structure, the design, and the budget. You need to understand the “building as a system.” There is modeling software you can use on your computer that shows the return on investment of optional improvements. Run this analysis before any purchases.
  4. Lack of education. Learn about what you are getting involved in. Know how things operate, how they are maintained, and what are their benefits.
  5. Not knowing what green is. Concentrate on energy efficiency, health, and environmentally friendly.
  6. Not knowing what features to include. There is a plethora of green items to include in a construction. There are so many options available you could get overwhelmed. Instead, consider what saves the buyer money and what doesn’t save him or her money.
  7. Not considering health as a major selling point. Health is of major concern to buyers. So health conscious features should be included in the structure. This includes volatile organic compound (VOC) paints, hypoallergenic flooring, and home sealing that assure good air quality.
  8. Not using independent green experts to keep you cutting edge. Many green construction companies partner with independent energy auditors that help keep them focused.
  9. Not building a brand. Don’t just consider the here and now. Set the standards high so you stay relevant today and in the future.
  10. Not promoting today to help sales tomorrow.  Keep working to educate people on the benefits of going green. Promote to the community and you will create a pool of prospective buyers who can be attracted to your next green investment.

Perhaps the most important thing to take away from this if you intend to invest in green construction is to learn as much as you can about the issue.

Some areas of the country have real estate consultants who are certified to provide information to buyers, sellers, and investors on the green real estate market. These consultants:

  • Are informed about environmentally safe and healthy materials
  • Understand the LEED rating system
  • Know about energy efficiency features and utility bill savings
  • Can recommend how homes can be more eco-friendly and energy efficient
  • Know how to find properties equipped with green features.

I recommend that you seek out a knowledgeable green real estate consultant who can help you avoid mistakes and develop a successful green real estate project.

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