Starting out right key to cost-effective green projects

Building Operating Management, Feb 2004 by Gottfried, David

Green design strategies are rapidly moving from a niche towards mainstream. Many owners have already embraced the precepts and are placing them into standard practice. But others are sitting on the sidelines waiting for more information. Some think that green costs more, or is risky and will delay their projects. However, experience shows that budget and schedule can be effectively managed. To get the greatest level of sustainable building performance for the least lifecycle cost, the owner and design team must approach the design process in an integrated development way.

In the traditional design approach, budget and schedules are imposed upon the design and construction teams; owners, designers and contractors never meet early in the process. In many cases, a green goal, such as a U.S. Green Building Council Leadership in Energy and Environmental Design (LEED) green building rating system certification, is introduced to the team after it has been hired. The result is not only frustration and lost project time but higher professional fees as well.

Begin at the beginning

The integrated approach begins at the conception of a new building. It has been shown that the cost premium for integrating green design into the project is much less, if any, when the concepts are embraced at an early stage. In addition, the performance of the building is enhanced.

Adequately defining the full development process upfront is key to the overall success of any project, but that's especially true for green buildings. From project inception, the owner needs to clearly define success. This includes not only the traditional elements of program, budget, schedule and aesthetics, but sustainability, flexibility and energy security. These items should be broadly outlined by the building owner at the outset and should guide the hiring of the project team.

The best-practice areas should be reflected in the request for qualifications and proposals for the design team and contractor. By developing a point system based on the best-practice areas, the owner can give credit for qualifications, experience and demonstrated creativity in those areas. This has worked well in many projects, including public design-build, where extra credit is given for sustainable building enhancements beyond those already outlined for the project.

It is critical that the owner include performance targets in legal agreements. Failure to achieve these targets should be treated as a contract default. The owner may consider including performance incentives for achieving higher levels than originally specified. In some cases, performance penalties could be used. For instance, a contractor would have to surrender a bond for not achieving the minimum energy-use goal for the project.

A best-practice target for a building might include an overall sustainable performance goal of a Silver LEED rating, and subgoals such as energy use at 20 percent below the code requirement and a material waste landfill-diversion goal of 75 percent. Other performance goals might include access to daylight for all employees, wireless cabling, flexible space office design and an underfloor air distribution system for conditioned air supply and cabling.

Even if an owner sets up the project for long-term performance objectives, the project can go astray if the owner's project manager is not educated in how to lead a sustainable project. Emphasizing solely the importance of budget and schedule is often not the best management technique. The team needs to be managed as a symphony conductor controls the orchestra. The project manager needs to understand each individual's capabilities and how to bring them together to achieve the best overall building. It's important to remember that this is an all-inclusive team. The property management and maintenance staff must be included from the very beginning. They have practical experience that can guide the project to even higher levels of performance and return on investment.

Making the team work

Once the project team has been assembled, hold a brainstorming session to specify performance targets in greater detail. Having the highest level of owner participation makes this session flow more smoothly and creatively. The team members will be looking closely at the owner's commitment as they define their level of buy-in.

All team members need to understand the owner's budget and work together to achieve the intended performance targets within the specified financial requirements. To do this, it is important that the owner share the line-item budget and the underlying assumptions. Often, one item can be reduced in cost through a creative and even higher level sustainable approach, while another may require an increase. For example, better building insulation and more efficient windows might cost more, but they will result in a reduction in the lighting requirements and mechanical system loads.

What's more, there are methods of "green finance" and "intelligent procurement" that can provide for any incremental increase in cost. One method is to negotiate for the purchase of the green products and systems, such as carpeting and lights, direct from the product manufacturers. Many firms will sell direct to an owner, eliminating several levels of markup. This could yield savings of 25 percent from the contractor's market price.