Foggy Windows

A major opportunity for energy savings, particularly in urban areas, is tenant improvements. In the last couple days I've spent time at businesses with drafty single-pane windows. Despite being attractive spaces, they were physically uncomfortable. My feet were cold, and I had to keep my down jacket on just to keep from shivering. The windows were foggy, and despite the heat running, all of the tables by the windows were freezing. Turning up the heat wouldn't do much except to bleed energy. 

This is similar to the 1900's era house I lived in for 5 years. We'd run the heat, and once the space hit the set temperature, it would only take a few minutes for the heat in the space to leak out. I imagine if the owners lived in the house they would replace or repair the windows and re-insulate the walls to save on heating bills and make the space more comfortable. But in a landlord's market like Seattle where the tenants usually pay their energy bills (and are often motivated to reduce energy use for ethical reasons), they don't have much motivation to make their properties more efficient.

What could be done to change this dynamic? How could landlords or tenants (or both, in conjunction) be motivated to choose better spaces or improve existing ones? 

One would simply be to enact laws mandating energy-saving improvements by landlords when tenants turn over. This isn't likely to be politically tenable in most places, as business owners would feel put upon. Voluntary action is more likely to be the way forward. 

Another idea would be to restructure lease agreements, whether through the legal system or on a case-by-case basis, so that the financial benefits, and costs, of energy-saving tenant improvements are shared between tenants and landlords. A third, which is already done to some extent, would be tax incentives or other government financial tools (residential tax incentives generally favor homeowners rather than renters or landlords).

What I'll be focusing on in the next few months is creating a tool to make the choice to go green for tenants obvious, by clearly showing the financial payoff of improvements, or of picking a space that is already suitable. The latter is important, as well-informed tenants can help push the real estate industry in the right direction. For instance, if a coffee shop owner wants to open a location in a new neighborhood, he can negotiate with landlords based on energy efficiency and other green design features - pushing landlords to at least consider these aspects as important elements of attracting tenants. The more tenants demand sustainable retail spaces, the more landlords will be pushed to improve their spaces.

Likewise, a tenant may decide to work with their existing landlord to improve their existing space based off the various benefits - monetary and otherwise - of doing so. 

So what tools already exist? The National Resource Defense Council already has a pilot project in the works. The key in the next two quarters will to be to build on this to develop a more robust tool to drive tenant and landlord decisions.

More to come!