mgt_360_week_4_summary.docx
THE SUSTAINABILITY OFFICERS AT SOME OF THE largest U.S. shopping center finns report progress with their companies' environmental protection efforts, hut they also say the learning curve is steep and the journey is long. Development firms that compete aggressively against each other in virtually every other way are coming together to share information about these efforts, just as they have cooperated on other major issues in the past. Macerich is undergoing a complete corporate culture change in pursuit of its green goals, according to Jeff Bedell, a Macerich vice president whose area of responsibility was changed in February from operations to sustainability. "The exciting piece is that we now have a road map and an internal plan," he said. "We realize it's not just the big decisions [on conservation] that are important. It's the everyday decisions made by managers and maintenance people alike that will serve to make us a sustainable company from top to bottom. It's a full-time focus. A pilot program Macerich set up at 10 of its properties is demonstrating that methods such as those that maximize the firm's air-conditioning systems can yield a 25 percent return on investment and a 5 percent increase in operating efficiencies, Bedell says. The company is pushing forward mall-cleaning policies than it expects to institute fully by next year; it also is exploring solar power as part of an energy plan for all its properties. Macerich will soon roll out a page on its Web site dedicated to engaging its employees in sustainability practices at every organizational level. "You want to look at a completely integrated approach," said Bedell. With all this, maintaining a sense of practicality is essential, says Bedell. "When you make the decision you want to be sustainable, you just don't run off the cliff trying to do every-thing." Indeed, he says, a responsible sustainability strategy involves more than breathlessly adopting all the latest green technologies and gadgetry. "In an environment where people are grasping for anything and everything and trying to catch the headlines, you have to remain sensible and use an approach that will have the greatest long-term impact." And then there is the general difficulty of achieving LEED (Leadership in Energy and Environmental Design) certification for centers. "The common areas of centers may be very sustainable, but the tenant utilization of the facility is the lion's share of what's going on with energy use," he said. "That's the biggest struggle. But we need to continue to focus on working with tenants in this way." Tenants may balk at paying extra, he says, for temperature-mtxJerating controls or low heat lighting, for instance. Jacksonville, Fla.-based Regency Centers has just completed a green-building training program for 70 company workers and contractors. Programs for green cleaning and landscape maintenance are being rolled out. Extensive retrofits to create irrigation and storm-water retention systems and parking-lot lighting are under way at two existing centers in California and one in Denver, says Mark Petemell, Regency's vice president of sustainability. Regency has already enjoyed a 15 percent savings from energy-efficiency improvements at its centers, but the firm expects to raise the bar Rirther, he says. At the corporate level, Regency is paying for capital improvements and buying services, goods and materials that reflect environmental stewardship; the company is also encouraging its workers to telecommute when it is possible to do so, and to use public transportation when it is not. Here, as at Macerich, a lack of flexibility in LEED certification policies in the shopping center environment poses challenges. Shopping center developers may be hindered in their LEED-certification efforts because retail projects involve a variety of tenants, with countless variations and customizations in the building specifications, all of which is difficult for the developer to control. In contrast, office and industrial projects are built inside more uniform spaces. "The U.S. Green Building Council and the industry are still working through that," Petemell said. "There are solutions." Cleveland-based Forest City Enterprises created the WorkCreen program to encourage conservation at all company facilities in energy, water consumption, waste recycling, procurement and transportation, as well as health and Wellness and community involvement. "From such programs, internal baselines are emerging that will allow us to set realistic targets for energy' use reductions," said Jonathan Ratner. Forest City's director of sustainability initiatives. The firm is also sending out surveys to 125 retailers to get a sense of "With the downturn in the market, we've all been forced to scrutinize projects and processes more closely for efficiency. The best money spent here continues to be dollars spent on energy efficiency." their latest sustainability philosophies, techniques and building needs. Forest Citi now has six LEED retail centers completed or under construction plus a dedicated LEED project page on its Web site. Forest City has teamed up with the Clinton Climate Initiative of the William J. Clinton Foundation to help create measurable business approaches to improving building energy efficiency. The Clinton Climate Initiative created a consortium for purchasing sustainable building materials and clean-energy products and its mobile building experts to create programs and share best practices, Ratner says. "With the downturn in the market, we've all been forced to scrutinize projects and processes more closely and push for greater efficiencies," he said. "The best money spent here continues to be dollars spent on energy efficiency." General Growth- properties is enjoying better-than-expected results from green programs. Soon after General Growth estimated for an April SCT article that conservation measures last year saved enough electricity to power 5,000 households, it found the actual equivalency was 6,000 households, according to Lisa Loweth, the firm's vice president of sustainability. Measures in the first quarter of this year doubled that rate, saving enough to power 3,000 homes while reducing energy consumption by 17 percent. Companywide recycling efforts last year saved the equivalent of a half million mature trees, she says. General Growth is testing on-site solar power and using hybrid gas-electric security vehicles; it has also begun using 15 percent recycled asphalt in new parking lots. Further, the firm has introduced an Eco Stance page on its Web site and an Earth Day guide that provides employees with tips for work and home. General Growth continues to practice "evolutionary redevelopment where we redevelop our own existing grayfields," Lowetb said. "We don't develop something and quickly sell it, and we don't abandon a building and build one across the street. We reinvest to keep our business sustainable. We're taking the long view, looking at things portfo- CBL & ASSOCIATES PROPERTIES' THE PAVILION AT PORT ORANGE (FLA.) WILL USE A WATER-REDUCTION SYSTEM THAT RECLAIMS AiR-CONDlTIONER cONDENSATION FOR USE IN FLUSHING TOILETS. liowide, not as individual properties. Hie firm says sustainable goals for new developments should be established well before construction begins. "If you do it as an overall plan, you'll develop your budget to it," Loweth said. "But if you do it as an add-on, you won't." Like other RElTs, General Growth finds itself challenged in trying to marry its environmental practices to the needs of tenants. "We try to be supportive of our national retailers' prototypes and business models," Loweth said. "And we are always trying to find ways to work with them that are practical." Sustainability efforts should never be centralized, she insists. "They need to be holistic and collaborative and weave through every department." Devetopere Diversified Realty Qirp. is using storm water to irrigate the landscaping at its properties and also looking at ways to reuse the water discharged fi-om air-conditioning units, savï John Sabatos, the vice president of construction. Green methods are now part of the firm's discussion on new centers, he says, and in many cases municipalities are driving that conversation. "Sustainability has gone from raising eyebrows in communities to open acceptance," he said. "In fact, many communities are asking for LEED consideration for centers, if not full LEED certification." Additionally, the firm is using gas-electric security vehicles and moving away fixed incandescent lighting on signage and decor, says John Kokinchak, executive vice president of property management. The REIT is saving energy with lighting retrofits in numerous parking lots by installing power-saving Watt Warriors, which reduce kilowatt usage without decreasing illumination. The firm is casting an even keener eye on energy efficiencies for its portfolio of properties in Puerto Rico, where there is no public utility commission to control rates and electricity is produced exclusively by costly fossil fuels, says Kokinchak. The REIT is studying solar power initiatives to harness the potential of shopping center roof space. Solar makes sense in many states, he says, particularly if it produces excess power that can be sent to the local power grid to offset shopping center energy experts. "The increased costs of electricity have suddenly made solar a far more viable alternative," Kokinchak said. Lowe's and Home Depot are looking into solar-panel installation on center buildings they control, he says. In general, tenants are requesting more skylights, more-efficient insulation and tighter building envelopes in the core-and-shell buildings they occupy. The firm operated a sustainable project with the I.I million-square-foot, mixeduse, Watters Creek at Montgomery Farm, which opened in May near Dallas. This is one of just a few LEED-certified retail "The increased costs of electricity have made solar a far more viable alternative." complexes in the state. The project is a joint venture with Trademark Property Co. and Coventry Real Estate Advisors. The firm is also building its own treatment facility to reuse waste water at its Guilford (Conn.) Commons development. Chattanooga, Tenn.-based CBL & Associates Properties announced a corporate wide sustainability program in June that builds on its existing initiatives. The company apfwinted Jim Williamson senior project manager and director of sustainability initiatives. At the headquarters level, CBL formed the Green Initiatives Research Team, consisting of representatives from the various departments. CBL "will continue to look at ways to expand the program with short- and long-term goals, education and research of alternative energy sources that make sense," Williamson said. "We will continue to evaluate building practices, additional retailer recycling programs and education programs involving the community," he said. The firm is taking its existing centers on their individual merits for green retrofits, he says. "But those projects will include such things as energy management systems, reduced wattage lights and light-harvesting methods around skylights," he said. One relatively untapped source of resource conservation is tenant participation programs, Williamson says. "Centers already have energy reduction programs for facilities management people. But in instances where we supply power to tenants, the company can pinpoint waste areas." CBL'sThe Pavilion, a 525,000-squarefoot shopping center in Port Orange, Fla., scheduled to open late next year, will feature a water-use-reduction system that reclaims air-conditioner condensation for use in flushing toilets. A retention pond will be part of an irrigation system that adjusts to soil moisture. Carbon dioxide sensors in the air ducts will gauge the presence of people and reduce the amount of ventilation required at unoccupied times. The roof and wall insulation will exceed minimum LEED standards. "One of the biggest challenges is keeping up with the flood of ideas out there," Williamson said. "There are so many opportunities with our contractors and suppliers.
nfiher
0
