03/13/08
Filed under:
Raves and Rants
Posted by:
site admin @ 3:25 pm
A week and a half ago, I attended an intensive two-day conference entitled “Managing Risk in Sustainable Building.” I felt compelled to get dressed up and drag myself downtown on the 7:11 train, not because it was organized by a friend, but because I believed it could be one of the most important conferences on sustainable building issues available to date. (OK, so the quiche, croissant and cappuccino breakfast they offered didn’t hurt, either.) This was the proverbial “deep end of the pool” and was comprised of presentations given by experts flown in from all over North America. It was a very good conference.
To summarize in brief: Vagueness in one’s definition of “green,” is a game of Russian Roulette. Sooner or later, someone else’s disappointed expectations are going to come back and bite hard. And they will say “Let there be lawsuits.”
The event sessions covered a very wide variety of topics, but one of the most compelling ideas put forth I was that we need to stop focusing on green labels and instead, look beyond them to the actual performance of our buildings. Our approach should be to evaluate based on results, not intentions. If we are to have a results-based approach, we must be prepared to test performance, accept the results and try to improve upon any failures. Not wanting to look for problems is an understandable human inclination, but turning a blind eye to problems doesn’t make them go away and hinders the evolution of the green-building industry.
Creating better buildings with very clear performance goals that can be communicated to potential buyers is key to improving the state of green building, which let’s face it, could be better.
We have a lack of standardization which is causing a great deal of confusion. Vague labels have brought us back to the “caveat emptor” philosophy of real estate sales. We need benchmarks and basic standards for what can be labeled “high-performance” or “sustainable,” “eco-friendly,” “efficient,” “green,” etc. We are seeing the beginnings of this, but potential buyers/tenants of green properties have a lot of information and claims to sort through.
I propose that reducing all forms of energy consumption as the basis of green building is the best way to achieve this. It makes sense because it is measurable. It also has the potential to add a great deal to the bottom line in reduced operating costs, which is attractive to buyers in every segment of the market. Sellers need to know their numbers and be able to communicate them to buyers. How do we get there? Modeling and testing. We model the plans and test the finished building. Then we can begin to agree on what the labels mean, match buyer expectations to seller offerings and coordinate a successful transaction.
Of course, there is another option….we could chuck the labels altogether and make it all about the numbers. This would make “environmentally friendly” building less about an idea which has always been tied to the political and instead make it about buildings that are irrefutably better. Doesn’t it makes sense to use known best practices to make the most efficient, pleasant, durable, useful buildings possible? This would eliminate the problem of semantic confusion and reduce liability issues that arise from that confusion.
We may never come to a full-industry agreement on exactly what “green” means, but if we can choose a basis, a bare minimum standard that we can all agree on, the evolution of green building will be more rapid and smooth.
10/03/07
Last week on the Today Show, during a segment on the national real estate market, CNBC’s Jim Cramer uncompromisingly state, “now is the absolute worst time to buy!” “Don’t you dare buy a house,” he said, shaking his finger.
Excuse me, Jim, but…WHAT?!! I do believe you are talking out of your ear…again.
There are no national generalizations to be made about real estate. (And don’t put forward the fact that huge production builders are freaking out as your evidence. They are actually quite a small segment of the overall market and have very little market share here in the Chicago metro area.)
When will the pundits stop acting as if the real estate market in California and Florida (and Texas, Washington, Maine…) is the same market we have in the Midwest?
Gary Keller of Keller Williams International had this to say:
First, residential real estate is not a national market product — it is a
local one. To say from a national position that this is either a good
time or a bad time to buy real estate is like saying the national
forecast for the U.S. today is 92 degrees — it is a useless and
irrelevant perspective. What is happening in your local market is all
that matters.
Second, trying to predict when it is a good time to buy, or not, means you’re
trying to time the market. Staying on the sidelines is the surest way
for most people to never time anything correctly.
Last, and maybe most important — there are always two markets in every
market. There is the market of properties that are good buys and there
is the market of properties that are not good buys. Interestingly
enough, this is true in either buyer or seller markets. To
categorically say that this is the time to buy or not is absolutely
ignoring the fact that every market really has two markets inside it.
Jim was quick to go back on the Today Show in response to Realtors’ complaints that his comments were “Misleading, inaccurate and inappropriate,” and remark that Realtors have a vested interest in saying it’s a good time to buy. Thank you, Captain Obvious, for pointing that out. However, the fact that the statement is self-serving doesn’t make it untrue.
Cramer is making the fatal error of treating a housing purchase like a stock investment. His comments are, at the very least, short-sighted and reckless. You can’t live in your stock portfolio and viewing your home solely as a short-term investment is a mistake. Your home is primarily shelter…so if you need shelter and you plan to stay for a few years, the smart money is still on buying your home.
Let me generalize about the market in Chicagoland, with the stipulation that the market in Bronzeville is still quite different from the market in Highland Park, of course: There is a lot more inventory on the market and market times are longer, and single family home prices have flattened a bit, but overall, average and median sales prices are not falling and are not expected to fall. What is selling? The good stuff…priced right. This is the kind of market where quality and correct pricing are the key to sales.
Buyers have a huge amount of choice right now and interest rates are still historically low. Mr. Cramer was suggesting that prices will crash in the future and that anyone who buys now will be overpaying. This might be true in Silicon Valley or on the Gulf Coast, but anyone who would wait for a price crash in Chicago is most likely kidding themselves and letting opportunity pass them by. Most people have a specific time frame they are working within and need housing where and when they need it. They can’t afford to put their lives on hold to wait for some fabled “bottom of the market.” No one knows where the “bottom” of the market is until it has long passed and prices are already up again.
Here’s my parting advice to anyone considering a home purchase: the next time some flash-in-the-pan “investment guru” makes a blanket statement and gives advice regarding the “national real estate market,” find the remote as quickly as possible and switch him off. Then call up your local real estate expert, listen to what they have to say, and make your own decisions with regard to how you want to go about meeting your housing needs.
06/27/07
Filed under:
General
Posted by:
site admin @ 3:39 pm
by Paul Ahlrich of
Grun Development
I have been asked many times what was most difficult in the transition to energy efficient building. The following is my reply:
I transitioned because in such a challenging marketplace as we have I thought I needed to differentiate my company. All builders have 42′ cabinets, stainless appliances and cherry flooring. In a down market, I hope that energy ratings will be a good selling point.
What has been difficult is that there is no economic model for building green. Estimates vary from a 2% to 20% increase in costs over conventional construction. That is a great deal of unknown, and when combined with the fact that I have never sold this type of housing before, I didn’t know if I would get paid for those extra costs. There have been many sleepless nights.
I decided Energy Star certification had more advantages to me and my customers than LEED. With Energy Star, buyers of my units can get tax breaks, special mortgages, and homes with proven reduced operating costs. I do not know what advantages LEED gives me or my customers. There is an added layer of bureaucracy from the city. They promised me reductions in my plan review fees, but the costs to become LEED certified eat any savings that brings. I feel I can offer low-VOC paints and finishes at a customer’s request. The same is true with water saving toilets, ANSI-rated cabinets and recycled glass tiles. There is also a comparable, but more efficient program called Green Globes that can be done online at a fraction of the cost. The city of Chicago does not recognize it, verbally telling me why, but refusing to give me a letter explaining it. Until Green Globes is recognized, and LEED becomes less costly, I may be done with both of them. So, Energy Star is what I offer.
Since I’ve never designed for Energy Star certification, I needed someone qualified to teach me. My architect had never done this type of work and didn’t know what was needed to get a building certified. I hired a consultant, as well as an energy rater to assist in my design and certification. Every builder will tell you that cost management and predictability is the name of the game in construction. Now, I had new designs, new materials and processes my crews had never been exposed to before. I also had many promoters of many products and technologies I was unfamiliar with egging me on to include them.
As to “green” building products and my efforts to use them preferentially (and others’ efforts to get me to use them):
Sustainably harvested wood
The city’s green permit program requires documentation that I have used sustainably harvested wood products. The lumber yard said, “We have no idea what sustainable lumber is, here is our wholesaler’s number.”
So I called the wholesaler.
“Yep, we have the documents you need somewhere here and will send them to you, but we get wood from eight different companies and it’s all mixed together in the yard. We have no way of tracking it.”
I got the paperwork, which satisfied the city. I have no idea what is really in my buildings. The value of softwoods is so low that they are harvested in a bulk manner. Hardwoods are more valuable and can be sustainably harvested. I am still not sure the costs of the documentation can be justified.
Bamboo flooring
There was quite an uproar when this subject was brought up! Sure, bamboo grows like grass (because it is) and replenishes itself very quickly. It’s the manufacturing process that gets folks going. In China, there is no EPA. The chemicals used to produce the product are toxic and often dumped instead of re-processed. Then there are the transportation costs to ship it half-way around the world which add to its carbon foot print.
Insulation
Most fiberglass insulation contains formaldehyde. This toxic chemical off-gasses into the home’s indoor atmosphere. I recommend specifying John Mannsville products which do not contain formaldehyde. They do not cost any more than standard products and are carried by large retailers like Menards.
I am still competing in a price sensitive market with lots of inventory out there. So with no true way to calculate costs, no way to gage market acceptance and no guarantee I will receive Energy Star certification for my work, it is a leap of faith.
Like I said, I’ve slept better.
06/19/07
Well, it finally happened. As the
Tribune reports, someone ran the numbers and discovered that the city has been using the wrong tools to achieve it’s goals. The city’s highly-touted LEED Platinum building uses MORE energy than it did before the “green” renovations were done.
What’s wrong with this picture?!
Building operations are THE LARGEST man-made contribution of CO2 emissions on the planet. In order to decrease our output of greenhouse gases, we need to stop using so much energy. Period. With modern building science, we can all get the same benefits and comforts from a building using far fewer resources. That, my friends, is the very definition of efficiency.
Instead of focusing on the less expensive low-hanging fruit of a high-performance (i.e. energy-efficient) building shell, the city went for the “sexy” stuff: outrageously expensive renewable energy systems and green roofs. The PV system on the Center for Green Technology alone cost as much as a new luxury single-family home in Lincoln Park. (For perspective, that money might have bought 15,000 Energy Star-rated window air conditioning units for Chicago’s impoverished elderly, many of whom die each summer from heat-related causes.)
These “renewable” systems are supposed to offset the building’s use of fossil fuels, but they are, in and of themselves, so inefficient that they barely make a dent in the massive electricity usage of this structure. We need to think about the embodied energy in these systems as well. How many tons of CO2 were produced in the manufacture and shipping of the PV panels comprising them? We need to look at the life-cycle of whole buildings and their components in order to make sound judgments.
Oprah Winfrey likes to say emphatically, “When you know better, you do better.” I just hope the city has looked at this situation and plans to improve (vastly) upon it. We certainly aren’t going to meet the goals of the 2010 imperative using ill-thought-out building techniques. Clearly, the Mayor and his decision-makers need better information going forward.
06/16/07
Filed under:
General
Posted by:
site admin @ 6:29 pm
Hello All,
Welcome to the Green Home Chicago Web Journal. This is a place to read opinions, rants and news articles about the real-world business of green building. Much material posted here will be written by or transcribed from conversations with professionals who are part of active green building teams that are currently producing high-performance housing here in Chicagoland and elsewhere (and have the scientific testing to prove it). I hope this journal will provide solid and thought-provoking information to the public and dispel some of the more rampant myths and rumors regarding the emerging green building field.
Enjoy!
Regards,
Celeste Karan, Realtor, GRI
Green Real Estate Specialist
Keller Williams Lincoln Park