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Green building: the next generation

Tuesday, October 5, 2010

The easy steps toward environmentally sound construction have been taken. Now the painful part: Will consumers pay for improvements that really make a difference?

Special to The Globe and Mail

Building green has become the Holy Grail for Canadian cities and the development industry. New service stations along Ontario's Highway 401 are being built to LEED Silver standards. New office towers in Toronto are striving to outdo each other in greenness. And Vancouver has committed to making "net zero" buildings - energy saved or generated equals energy used - the standard for all rezonings by 2030.

But some worry about what the new rush for green building is really accomplishing. Is it greenwashing? Or is it actually fundamentally changing the basics of construction and, as a result, the environmental impact of new buildings? And the big third question: Are buyers willing to pay for it?

We've brought together Peter Busby, one of Canada's leaders in green architecture, and Bob Rennie, the influential Vancouver condo marketer who is the last say for many developers on what will sell.

Frances Bula: Bob said recently that 85 per cent of any green project is fine, it's doable, and then the last 15 per cent costs a fortune - roof gardens that require expensive watering systems, blinds to reduce solar heating, or whatever. It drives a project way over budget and people won't pay for it.

Peter Busby: The easy part of green is done, I agree with you. Previously, developers kind of got away without having to tackle the energy issues. Now they're being forced to do more, by new building codes or the need to get more [LEED] points. So what that means is radiant energy systems, proper window shading and a better envelope.

Ms. Bula: By envelope, you mean the outside shell of the building.

Mr. Busby: Yes, and that's where you get the real energy savings. Under the next version of LEED and the building code changes that are being considered across Canada, you have to do a better envelope, and that's where it costs money. Putting in C02 monitors or a bit of green roof or some bicycle racks doesn't cost much. But when you have to do things like really insulate all the edges of the concrete slabs for each floor, now you're starting to spend. It goes from 60 bucks a square foot to 80 bucks a square foot.

Bob Rennie: So if it adds $20,000 to the cost of the suite, and somebody has to finance that suite, and drive to work three years longer or two years longer to pay that off, I don't know where the real savings for the planet happens.

Mr. Busby: It's not $20,000. Typical elevation of a condo is nine feet high and 22 feet wide, max, which is 200 square feet - it's $4,000 bucks. So for $4,000 a suite, you get a high level of energy performance. You can reduce your energy consumption in that building by half.

Mr. Rennie: By half?

Mr. Busby: By half. It pays. In Toronto, buildings consume twice as much energy because it's colder in the winter and hotter in the summer. So the financial saving is far more significant. The worst case is Vancouver.

Mr. Rennie: But aren't we going in 2030 to net zero? And net zero today is about a 25 per cent additional cost to a traditional building.

Mr. Busby: I would disagree with that.

Mr. Rennie: What price would you say?

Mr. Busby: I think a high level of LEED Platinum is seven to 10 per cent premium on costs. Those are the Dockside [Green] costs; we believe that Dockside costs are seven per cent over traditional building.

Mr. Rennie: And did it make money, sir? [SILENCE] I'll take that as a no.

Mr. Busby: It did not make money because it was priced competitively against non-green product. Dockside was competing against buildings that weren't trying to do anything in terms of green, so [the developer] didn't get much of a premium in the marketplace for his green features. And that came out of his profit. And that's why the project's dead right now. And that's why we have to have improved building codes. They must pay for a better envelope. Everything else is greenwash. If you don't make a better building that performs better, you're just putting green fuzz on buildings.

Mr. Rennie: But to just say we're going to raise all the prices - and I guess I'm looking at Vancouver, where the cost of housing is already very high - you have to have some conscience on affordability and home ownership.

Mr. Busby: I'm saying it's worth the investment. It's worth it from an emissions point of view. It's worth it to save the planet. It's worth it to have a healthier, more efficient unit to live in. It's worth it to have flooring and adhesives and paints that don't kill you when you're living there.

Mr. Rennie: So what we have to say is the cost of housing just went up.

Mr. Busby: By one per cent. You know, I've got so many really hard facts about the dollars spent and saved for each item, I've got such a volume of real cost information, but we surely don't have the time or space here. Bob, I really would like you to see what we've got. Real facts. Because I think you'll be surprised.

Mr. Rennie: Well, then my developers are lying to me.

Mr. Busby: Well, developers will always construe facts to suit themselves. They'd rather not do the green stuff so they'll tell you it costs five or 10 per cent more. But you know what, we have to get them to do it. We're going to bring in four or five of our best developer clients and we're going to sit them down and say, 'Okay, here's -

Mr. Rennie: I want to sit in on it.

Mr. Busby: Yeah. I'm going to invite you. You need to know, you need to be informed, you need to have the facts.

Mr. Rennie: I'll be there. But we can't just tell the consumer to pay more. This has to work for them and, if it doesn't, they aren't going to buy it. They'll move somewhere else, out of Vancouver. And, in the end, that's what we have to look at, not just what rich people in the city are willing to pay for.




Peter Busby is a Vancouver architect whose creations, from SkyTrain stations to towers, are city landmarks. A founder of the Canada Green Building Council, he was the architect for North America's pioneer green residential project, Dockside Green in Victoria. He is also building green residential projects in Toronto, Ottawa and Calgary, as well as working on projects around the world.


Bob Rennie is the best-known condo marketer in Vancouver. His company, Rennie Marketing, racked up $1.5-billion in sales in 2007, at the height of the pre-recession condo boom. But marketing is only part of what he does. Mr. Rennie also plays a significant role in shaping developments and mediating among regulators, developers, politicians and architects. Mr. Rennie lives in an ultra-modernist condo designed by Mr. Busby.