Green Building: A Real Estate Revolution? Green building now accounts for close to one-third of new U.S. construction. That's up from 2 percent in 2005, according to McGraw-Hill Construction, which tracks the industry. The U.S. Green Building Council, and its LEED rating system, have changed construction practice -- and policy -- around the country.
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Green Building: A Real Estate Revolution?

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Green Building: A Real Estate Revolution?

Green Building: A Real Estate Revolution?

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From NPR News, this is ALL THINGS CONSIDERED. I'm Melissa Block.


And I'm Robert Siegel.

While much of the real estate market struggles, one area of the construction industry has seen stunning growth. Green building now accounts for about a third of new construction in the U.S. That's up from just 2 percent in 2005. These are the latest figures from McGraw-Hill Construction, which tracks the building business, and they suggest a revolution inside the industry.

There are many factors, and many players, in this move toward green building. But one company and its rating system have played a key role, as NPR's Franklyn Cater reports.

Unidentified Man #1: Oh, there we go, yes, some motion detectors on the sinks.

FRANKLYN CATER: The new Ross School of Business building at the University of Michigan is full of environment-friendly technology.

Professor ANDY HOFFMAN (Sustainable Enterprise, Ross School of Business, University of Michigan): One of humorous things about studying this kind of topic is you can talk about dual-flush toilets and waterless urinals in polite company.

CATER: Andy Hoffman is a professor of sustainable enterprise. He teaches a course in green construction. And along with facilities manager John Bresette, he's giving me a tour. Among the highlights, oddly enough, is this men's room equipped with dual-flush toilets.

Mr. JOHN BRESETTE (Facilities Manager, Ross School of Business): Saves a little water if you pull up, opposed to pushing down.

CATER: Point 8 in 1.6 gallons?


(Soundbite of toilet flush)

Mr. BRESETTE: So even with the full flush, you're just getting the 1.6.

Prof. HOFFMAN: It's pretty intuitive. I think this is the more culturally challenging issue for some people - is a waterless urinal. People immediately think, oh, this is going to stink. But it doesn't smell. You can't smell it right now.

CATER: As long as the filters get changed regularly.

In construction, as in other arenas, green manufacturers have sometimes had to contend with the perception that their products are inferior. Plumbers' unions have opposed waterless urinals. Nonetheless, the sector for green building products is burgeoning: paint, wallpaper, windows, flooring.

That sector was practically nonexistent in 1993, when the U.S. Green Building Council got its start. The USGBC created the LEED program, and Hoffman gives them a lot of credit for helping to create demand.

Prof. HOFFMAN: They created a cachet around the LEED certification. And they got people to want to do this as a marketing pitch. And I think that was really a stroke of genius, to get a rather inertial industry to start to shift.

CATER: LEED is spelled L-E-E-D. It stands for Leadership in Energy and Environmental Design. Certified buildings get a plaque for prominent display. And if you already know all of this, it's a sign of the brand recognition LEED has developed.

Hoffman thinks this is now key to attracting top students.

Prof. HOFFMAN: College campuses, they're all starting to go this way. If you want to keep up with the Joneses, you kind of got to do that.

CATER: The University of Michigan leadership apparently agrees. This summer, they committed to seek LEED certification for every new construction project of at least $10 million. On the average $100 million project, they figure the silver level of certification will add 2 percent to the cost. This is a big endorsement of LEED. The university has a $2 billion construction program.

LEED is set up like a sort of building Olympics. Projects earn points for various features. Use renewable cork flooring, for instance, get a point in the materials and resources category. Use paint that doesn't give off toxins, score a point for indoor environmental quality. There are categories for site selection, water efficiency and energy. Pay the fees, rack up the points and win a basic, silver, gold or platinum rating.

The Ross building achieved silver. The company dumped its bronze rating a while back and renamed it simply certified.

Ms. MICHELE RUSSO (Director, Green Content & Research Communications, McGraw-Hill Construction): They're one of the most savvy nonprofits when it comes to how do you reach out to the press, how to do marketing, and how to communicate their message.

CATER: Michele Russo is director for green research at McGraw-Hill Construction in Washington.

Ms. RUSSO: The word L-E-E-D meant nothing, you know, 10-odd years ago. And now, that is literally like Kleenex is to tissues. I mean, you think of a LEED building and people think, oh, it's a green building.

CATER: Russo says the USGBC has been smart to network in every sector. And there's a growing army of people with LEED credentials.

(Soundbite of LEED online course ad)

Unidentified Man #2: Tackling the new LEED exams is an intimidating challenge for many professionals. But our proven methods and...

CATER: Around 155,000 designers, contractors, consultants and others have studied up using courses like this one online, then passed the test to earn the designation LEED Accredited Professional, or the easier Green Associate.

Employ a LEED AP on a project, and you get a point for that. But the human infrastructure around LEED far exceeds the number of actual projects. Overall, the USGBC says they've registered about a third as many commercial and residential projects as there are professionals, and they have certified just 12,000. So why are so many people getting credentialed?

Michele Russo says as an industry observer, the LEED AP gives her added credibility.

Ms. RUSSO: It helps my team. I have a new staff person; he's getting the LEED credentialing. So you know, it is nice to have on the business card when handed out, just adds that additional, you know...

CATER: Yeah, it kind of looks cool. It's almost like Ph.D. after your name.

(Soundbite of laughter)

Ms. RUSSO: I would not go that far.

CATER: Okay, big overstatement.

The basic test is just a couple of hours long. But so many people want the professional designation that it is a huge source of revenue. The USGBC brought in $107 million last year. Some 42 million of that was related to accreditation.

And here's another reason for professionals to get familiar with LEED. In more and more places, LEED is becoming law. Many lawmakers are buying the idea that encouraging or forcing developers to build green is not only good for the environment, it's good for economic development, and good for the health of workers who occupy those buildings.

But there are those who say LEED doesn't deliver on all its promises. I'll have that part of the story tomorrow.

Franklyn Cater, NPR News.

SIEGEL: One big question about LEED buildings is whether it's worth the added cost. You can find more about the University of Michigan's answers to that at

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