Editor's Note: To learn more about the financial implications of LEED buildings, be sure to check out VERGE@Greenbuild, November 12-13.
Owners considering LEED certification for their buildings often ask what level of financial return they can expect for their investment in green products and services.
This starts with a measurement of costs. Owners should be certain their LEED consultant is able to audit their buildings and accurately calculate the cost of obtaining various levels of LEED, including both the implementation of improvements and the cost of the certification process itself.
Estimating the financial gain is a trickier process, as market variables and qualitative benefits enter the equation. But the challenge of calculating return on investment (ROI) is lessened somewhat by the steady stream of reports analyzing the cost of LEED in new and existing buildings -- and the financial payback.
The cost of LEED
The most commonly cited studies on the incremental cost of LEED come from international construction company Davis Langdon, which compared fit-outs and renovations in LEED and non-LEED buildings. Overall, fit-outs and renovations of LEED-certified buildings carried a premium of 1.84 percent, or slightly more than $18,400 per $1 million of construction cost. The incremental cost averaged 2.11 percent in LEED Silver buildings, and just 1.82 percent in LEED Gold buildings.
Why would Silver certification cost more than Gold? Davis Langdon theorized that some owners pursuing Silver certification may have implemented expensive technology, while those reaching for Gold may have taken greater advantage of passive design opportunities.
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