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By AZ Advisory Team, October 28, 2009 8:09 am

The University of Miami Field House, a multipurpose facility at the Coral Gables campus, has been honored for its sustainability components. It was awarded the LEED® Gold designation established by the U.S. Green Building Council and verified by the Green Building Certification Institute (GBCI). LEED is the nation’s preeminent program for the design, construction and operation of high performance green buildings.

The UM Field House achieved LEED certification specifically for its energy use, lighting, water and material use as well as incorporating a variety of other sustainable strategies. By using less energy and water, LEED certified buildings save money for families, businesses and taxpayers; reduce greenhouse gas emissions; and contribute to a healthier environment for residents, workers and the larger community.

Alex Zylberglait provides commercial real estate investment advisory as well as research, estate planning, asset allocation, valuation, financing, special assets services, transaction advisory and commercial property acquisition and disposition services.

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By Alex Zylberglait, October 27, 2009 7:21 pm

Make Improvements to the Property

Improvements can take the form of cosmetic improvements or substantial rehabilitation. Cosmetic improvements include such things as new paint or wallpaper, new decor to the common elements, new landscaping, new carpeting/flooring, etc. Substantial rehabilitation involves making structural improvements to the property – for example a substantial rehab may involve redoing all the units of a multifamily property, or changing the structural façade of a shopping center, or making major renovations to the lobby of a large office building. While doing rehabilitation, it will be a bright idea to make improvements toward LEED certification. In any case, you increase the value of the property for not only your tenants, but for your own portfolio as well.

LEED certification

LEED (Leadership in Energy and Environmental Design) is a third-party certification program and the nationally accepted benchmark for the design, construction and operation of high performance green buildings. LEED gives building owners and operators the tools they need to have an immediate and measurable impact on their buildings’ performance.

This strategy uses five categories to guide building performance: Sustainable Sites, Water Efficiency, Energy Efficiency, Materials and Resources, and Indoor Air Quality. It can be implemented for new or existing buildings of any size.

The federal government already requires LEED for all military projects and most projects where government offices are housed, because of the environmental benefits of the process. Cities such as Chicago require all their public buildings to be of this high quality. Major retailers like Best Buy have made the commitment to building LEED Certified stores.

LEED Certified buildings are said to have better occupancy rates because LEED is considered a “premium amenity”, something that separates the wheat from the chafe. Clearly, there are benefits to getting ahead of the curve in the commercial real estate market. Do not be left behind. If you are truly interested in maximizing your cash flows and to start saving real money you should consider engaging a LEED consultant and see how you can upgrade your performance.

I will be glad to put you in touch with reputable companies to help you get LEED certification.

Alex Zylberglait provides commercial real estate investment advisory as well as research, estate planning, asset allocation, valuation, financing, special assets services, transaction advisory and commercial property acquisition and disposition services.

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By Alex Zylberglait, October 26, 2009 5:46 pm

If you are thinking about purchasing commercial real estate, it’s important to know that there are things that you can do to enhance and increase the value of your investment. As such, when you search for a commercial property, look at the property’s potential in addition to its historical data. Because the value of commercial real estate is primarily driven by the cash flow that the property generates, any strategy you employ has the potential to increase your cash flow, decrease your expenses, and increase your overall equity and the value of the property.

Case in point is a Class B office building known as Golden Eagle Plaza at 525 B St. in downtown San Diego which was turned into an arguably Class A superstar by Hines Interests LP.  The San Diego Business Journal reports that Hines upgraded this well-located, 22-story office building, by refurbishing it with a new lobby, new roof, elevators, controls and systems, and by getting a LEED certification.  Read full article here.

Now that commercial real estate assets are anticipated to devaluate in the coming months, investors like you should be seeking new strategic assets to invest in. The economics of purchasing existing buildings (especially when its owners are  distressed) with fairly good fundamentals and then upgrading them is very promising.

Aging properties, making sure it passes its Forty-Year Recertification, must also be upgraded or the best tenants will look elsewhere when they seek additional space in the coming years in response to the anticipated growth in the economy.

Hines’ retrofit strategy seems to be paying off as early as now:  San Diego’s large law firms ares moving to Golden Eagle Plaza like the firm of Procopio, Cory, Hargreaves & Savitch LLP, have already committed to 100,000 square feet in the building.

Stay tuned for my future posts as I elaborate further on how you can increase the value of your commercial real estate property.

Alex Zylberglait provides commercial real estate investment advisory as well as research, estate planning, asset allocation, valuation, financing, special assets services, transaction advisory and commercial property acquisition and disposition services.

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By AZ Advisory Team, September 11, 2009 8:29 am

The Building Owners and Managers Association of Chicago has launched an effort to develop the country’s first commercial office building smart grid program.  This is to deliver a utility-scale, clean, virtual generator through implementation of smart grid technology in more than 260 commercial buildings in downtown Chicago.  With this program, downtown Chicago will have the potential of providing as much as 200 megawatts of demand response capability.  The program would lower costs and avoid the need to construct expensive new generation plants. It requires upgrading the buildings’ electric metering infrastructure, with significant building-level upgrades.  To help address the estimated $185.4 million program cost, the city’s BOMA chapter filed an application for $92.7 million in matching funds from the U.S. Department of Energy’s Smart Grid Investment Grant Program, which was formed under the recently passed American Reinvestment and Recovery Act.

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Alex Zylberglait provides commercial real estate investment advisory as well as research, estate planning, asset allocation, valuation, financing, special assets services, transaction advisory and commercial property acquisition and disposition services.