A few months back we did a post on New York City Local Law 84/09 which requires buildings that are 50,000 square feet or larger to report to the City their electricity, gas, fuel oil and steam usage, and if equipped with an automatic meter reading equipment, water usage as well.
Since then, building owners in NYC have shifted their focus as it concerns sustainability from merely adhering to legal requirements to taking proactive steps to make their properties more attractive to potential investors
The reason behind this shift is to address the growing trend among investors of incorporating sustainability in their evaluations of potential real estate investments. A recent example of this was a survey initiated by a group of pension funds in the Netherlands to various real estate firms in New York to evaluate their sustainability operations.
With NYC’s new reporting requirements, there will soon be a plethora of available data on the sustainability strength of various buildings in NYC (the Department of Buildings has generated a list of all buildings that must make 84/09 reports). This information will become critical to the economic and operational viability of property ownership in NYC. It is safe to assume that lending institutions will follow this trend and incorporate sustainability in their due diligence before approving loans to commercial properties in NYC.
By Nahum M. Palefski, Esq.