How SGS ISO 14001 works for New Construction

As you know, 14001 is a progressive improvement standard.  In other words, start with the current performance (i.e., create a baseline via energy bills or an energy audit) and build the go-forward recommended plan to show continued progressive improvement.

But, what happens if you are faced with New Construction?  It has no prior history and there is nothing to audit.

One of our franchisees has presented to a developer who is building a luxury condo tower.  He already has his final plans and financing.  He has NOT yet started his sales/marketing campaign, but his construction crew is on site, pushing dirt.  The units will sell for +$1 million.  Based on his historical success, he will sell his entire inventory prior to CO.

Net, he is not going to change his design plans and does not need us to help him sell his inventory.

So, what can we offer him?

Based on industry data, a Green certification can impact sales price by 3 – 11%.  Net, in our above example, a $1,000,000 unit can now be sold for $1,030,000 – $1,110,000.  That’s found money and is a big deal to a developer, even if he knows he is going to sell his entire inventory.

But, the historical solution, LEED, costs 15% for new construction.  A 3 – 11% increase in price tied to a 15% cost is not a good decision.  This is why LEED is falling from favor with developers.  (As an aside, BREEAM tends to be more expensive than LEED)

This guy knows he can increase his sale price if he can attach a Green certification to his project; but the historical options are too expensive.  Further, this developer aside, what if a developer is concerned about selling his entire inventory and wants to promote the resale benefit of a green certification to his prospects?

This is where we come in….

The SGS ISO 14001 program allows us to use the developer’s plans/specs to design our Environmental Action Plan (the key application tool in the SGS ISO 14001 certification process).

The progressive improvement we need for the annual continuation of the program can be accomplished partially/mostly/entirely (depending on project) via the future ongoing maintenance plan, once the building opens and we see actual performance.

In the above example, our franchisee will not initially sell any product, as the spec was written before he started his conversation.

But… he can bake his monthly advisory fee into the ongoing operating budget of the building as an ongoing cost of maintaining the certification.  This fee will be incorporated into the condo unit owner CAM costs and paid by the units, once the property opens.  He will be locked in.  This puts him into a very strong position, as contracted sustainability advisor, for the future Green work on the property.

Point of all this is – On new construction, I know of no other program, globally, that offers the level of flexibility and financial benefit to a developer as our SGS ISO 14001 program.