Doing Well By Doing Good? Green Office Buildings

Date Added: Aug 2009
Format: PDF

This paper provides the first credible evidence on the economic value of the certification of "Green buildings" - value derived from impersonal market transactions rather than engineering estimates. For some 10,000 subject and control buildings, the authors match publicly available information on the addresses of Energy Star and LEED-rated office buildings to the characteristics of these buildings, their rental rates and selling prices. They find that buildings with a "Green rating" command rental rates that are roughly three percent higher per square foot than otherwise identical buildings - controlling for the quality and the specific location of office buildings.