Nearly half of all leasable office space in the Denver area is in energy-efficient, sustainable buildings, according to an annual study.
Denver ranked sixth on the 2015 National Green Building Adoption Index, conducted by CBRE and Maastricht University, trailing only Minneapolis/St. Paul, San Francisco, Chicago, Atlanta and Houston in the 2014 data.
In the Denver area, 48.7 percent of office square footage was classified as green, defined as being certified through the U.S. Environmental Protection Agency's Energy Star program, U.S. Green Building Council's Leadership in Energy & Environmental Design standards or both.
That's 10 percentage points higher than the national average, but still well below the Twin Cities' 70.4 percent.
The office construction boom in Denver, though, should bode well for improved results in the future, CBRE officials said.
David Pogue, CBRE global director of corporate responsibility, said green has become the norm, particularly for large office buildings. "Before, people were able to use certification as a differentiator. What happens now, if you don't have it, it's a differentiator," Pogue said. "The market has really moved in a really rapid way."
In the 20 smallest markets CBRE studied — a group that includes Denver — 66.2 percent of buildings 250,000 square feet or larger were certified by Energy Star, LEED or both. Just 4.41 percent of buildings under 100,000 square feet were certified.
For developers and property owners, being green comes down to a return on investment and attracting tenants.
"In a community like Denver and particularly in a downtown area, you pretty much need to be LEED-certified or a green building to attract good tenants," said Bill Mosher, senior managing director of Trammell Crow Company in Denver.
Interestingly, though, many tenants will not build out their interior spaces to LEED standards, he said.
In the case of 1900 16th Street, a 400,000-square-foot, 17-story office tower that Trammell Crow completed in 2009, the company ended up requiring all tenants to get their interiors LEED- certified. This allowed the building to raise its overall LEED rating from gold to platinum, Mosher said.
"You may have to increase your tenant improvement allowance to be competitive, but in that case, it really paid off," Mosher said. "The rating has increased over time."
Whether it's more efficient heating and cooling systems or LED lighting, getting a return on investment on energy improvements is not that difficult, he said.
"Where there's long-term ownership, it's frankly not that hard to justify," Mosher said. "It's a little hard when you're building it and as soon as it's leased, you're flipping it."
More companies are also starting to weigh what a sustainable environment can return in terms of their employees, Pogue said.
"If they can demonstrate they can attract and retain and have a healthy workforce who stays on task longer and has a tiny improvement in productivity, that pays for itself," Pogue said.
Emilie Rusch: 303-954-2457, [email protected] or twitter.com/emilierusch.