What makes the LEED Dynamic Plaque a game-changer?

What makes the LEED Dynamic Plaque a game-changer?

Image of Leed Dynamic Plaque survey by USGBC

When the U.S. Green Building Council makes big changes to its systems or standards, the real estate industry takes notice — and with good reason. Its main initiative, LEED, has an outsize impact on the real estate industry, from building materials to investment criteria — and any major changes to the system have the potential to greatly affect green building for years to come.

Although you may not have heard more than a tidbit about the LEED Dynamic Plaque ahead of its launch earlier this year, make no mistake: This is the sort of innovation that drives widespread change.

Even for a building, a year's a long time

Without getting too deep into the technical details (USGBC explains it more extensively in a live web demonstration), the LEED Dynamic Plaque is an add-on to existing LEED certifications. It introduces an ongoing performance element to the traditionally static scheme. It's a platform — both physical and virtual, publicly displayed on an existing LEED building's site — that's designed to help property owners monitor, benchmark and update their LEED scores in five areas: energy, water, waste, transportation and occupant experience.

While a building's official score is recorded just once a year based on a recertification schedule, the Dynamic Plaque updates as frequently as it receives new information. For example, if your building has a LEED score of 72 but you think it could be higher, you might send out transportation and occupant experience surveys and perform a waste audit to look for potential improvements. After improvements are made, you can provide the platform with new data and the LEED score will be recalculated instantly.

 U.S. Green Building Council

Faster adoption of improvements

Why is this system such a potential breakthrough? Consider the following abridged version of how the commercial real estate industry makes decisions about green building: Investors want to make sure that their real estate investments carry minimal risk and maximum appropriate return. For some investors, particularly pension funds such as CalPERS, sustainability is finding its way into these calculations.

Asset managers are then tasked with implementing an investors' plan. Many real estate asset management groups (think Bentall Kennedy, TIAA-CREF and Prudential Real Estate Investors) view green building as a way to minimize risk and improve returns — and LEED certifications are an accepted standard for implementing sustainability in a commercial real estate portfolio. Therefore, we find more asset managers want to know if potential acquisitions are LEED-certified, as well as an increased willingness to pursue LEED for existing portfolios.

[Learn more about next-gen buildings at VERGE SF 2014, Oct. 27-30.]

The responsibility for pursuing LEED certification typically falls on the property management firm, a green building consultant or both. Major property managers such as CBRE and Cushman & Wakefield have boosted their internal capabilities to handle the increased demand for LEED.

However, the relatively static nature of LEED certification leaves the system open to criticism that it is more about strategies than performance. In reality, we see some asset and property managers who consider LEED as a sort of "set it and forget it" commitment. By further opening up LEED certification to continuous monitoring, the LEED Dynamic Plaque allows investors, asset managers and even tenants to demand an actively managed LEED score.

Engage the occupants

What does an active score mean to the commercial real estate industry? Everyone working to make their buildings more energy-efficient knows the phrase "you can't manage what you don't measure" by heart, but not everyone may be as familiar with the closely related, "what gets measured gets scrutinized, written about, argued over and eventually added into contracts." By making it feasible to include something such as regular occupant surveys into an accepted sustainability standard, USGBC is attempting to rewrite how the industry defines sustainable operations.

 U.S. Green Building Council

For example, picture a large national office user with a significant commitment to sustainability that includes targeted reductions in energy, waste and water over a certain time period. The company already requires LEED or ENERGY STAR certification for most office locations. Through the LEED Dynamic Plaque, however, the company's real estate team can ask landlords to more frequently report on those targets at each location, as well as conduct regular occupant satisfaction surveys. They can ask that the LEED Dynamic Plaque score never drop below 70, or that occupant satisfaction never dip below 80 percent.

Similarly, consider an asset manager deciding whether to renew a property management contract. If the hiring decision already considers the manager's ability to help the property achieve LEED or ENERGY STAR, why not go one step further and incorporate new elements of the LEED Dynamic Plaque platform?

Dynamic Plaques motivates more players

Could a sustainability-minded asset manager ask prospective property managers for an annual score increase? Or, if some of those goals already exist in the property management contract, could they be managed more collectively through the new platform?

The LEED Dynamic Plaque is exciting because when a market standard as big as LEED introduces a new option, it speeds up the adoption process. Performing a waste audit is not a groundbreaking idea. Performing a waste audit to bump up the LEED score that your building's occupants can see as they walk into the lobby every morning — now that has the potential to motivate an industry.

Learn more about this in person from LEED senior VP Scot Horst  at VERGE SF, Oct. 27-30. Top image of LEED Dynamic Plaque Survey by U.S. Green Building Council.