Make Green Being Green
These days, tenants are looking to lease space in LEED-certified buildings more and more. Whether for the actual benefits of lower building energy, the improved interior working environments for employees or simply the corporate culture, companies like to see the LEED-certified logo on the outside of their properties. (In fact, the Environmental Protection Agency just named Cassidy Turley a 2014 Energy Star Partner of the Year for protecting the environment through superior energy efficiency!) In honor of Earth Day this week, let’s take a look at the green office buildings in Manhattan and see how they compare to the buildings stuck in the Ice Age.
Less than 10 percent of the buildings we track at Cassidy Turley are LEED-certified, leading to some interesting statistics. Focusing on only those LEED-certified buildings in Manhattan, the availability rate is 8.6 percent, a 220-basis-point difference between the availability rate of 10.8 percent for buildings that are not LEED certified. With occupancy levels higher in LEED-certified buildings, asking rents follow the same trend: the average for Manhattan LEED-certified properties is $75.22 per square foot, $9.02 more expensive than at non-LEED- certified buildings.
This asking rental spread is mostly due to Midtown LEED-certified properties, where asking rents average more than $5 per square foot higher at $80.18. Midtown LEED-certified buildings are in high demand as the availability rate is 220 basis points lower—9 .1 percent—compared to buildings that are not LEED-certified.
Downtown Manhattan follows the same trend for the available supply, as LEED-certified buildings’ availability rate is just 6.1 percent, significantly lower than the 13 percent availability for those not LEED-certified. Midtown South is the only area that bucks this trend, as LEED-certified buildings carry an availability rate of 8.4 percent, 110 basis points higher than non-LEED-certified addresses. This is mostly due to more than 500,000 square feet available at the Empire State Building.
So whether you are a landlord or a tenant, LEED-certified may be the way to go. Happy Earth Day!