Strategies for Carbon Reduction in Offices
November 30, 2022
Low Carbon Tech and Finance Series
Office | Large Office | Healthcare | Multifamily
C-PACE presents a signficant opportunity to impact returns for both property owner and tenants by reducing annual utility costs more than the increase to repay through annual property tax bill presented to tenants. CounterpointeSRE has partnered with the Department of Energy to advocate and to provide 100% financing of low carbon strategies for office buildings with owner retaining all rebates and tax incentives.
C-PACE allows owners to align their interests with tenants to provide resiliency during power outages, to reduce their NNN tenant’s operational expenses, and to benefit their greater community by decreasing the building’s carbon emissions.
From adaptive reuse to new construction, C-PACE can lower blended rate of capital stack and efficiently finance the DOE’s recommended low carbon strategies for office buildings highlighted below with no capital outlay, as introduced in the case below.
Department of Energy Low Carbon Strategies
Interior and exterior dimmable LED lighting fixtures that are controlled by photocells, time clocks, or occupancy sensors networked into building automation system (BAS). Download details below.
HVAC Cooling and Heating
Heat energy recovery systems with economizers and heat exchangers, thermal energy storage systems, modular chillers for variable loads, heat pumps, variable refrigerant flow (VRF) systems or district water loop heat exchange to replace existing chillers and
boilers. Reduce ventilation requirements through VFDs, DCV, air cleaning technology, and beam system with dedicated outdoor air (DOAS). Point of use water heaters.
Download the Better Buildings guide to selecting an energy management and information system here. Suggestedd actions include photocells, occupancy sensors, HVAC controls and other flexible strategies to reduce or shift energy loads to minimize demand charges.
Increase airtightness, install window films, and upgrade windows, doors and roofing. Counterpointe’s guide on eligible roofing is available here. Consider upgrading insulation during façade replacement and repairs.
Renewables, Generators and Battery
Offices benefit from on-site renewable production, which most often takes the form of solar deployed to cover roof areas and parking as needed. Integrated battery storage and demand flexibility controls can be deployed to balance production and demand.
Download the full Low Carbon Technology Strategies guide for large office from the Department of Energy’s Better Buildings initiative here.
C-PACE in NNN Office
The retrofit of a trophy office building is projected to yield an estimated carbon reduction of 12,542 metric tons over the 25-year C-PACE financing term.
- 380,000 sf office in Center City Philadelphia financed energy efficiency improvements: LED lighting, insulation, and HVAC
- Flexible financing ($25.57 million C-PACE) with interest only period smoothed out impact to cash flows
- NNN leases with pass-through to tenants aligned benefits of utility cost reduction with repayment
Additional Case Resources:
- Counterpointe Sustainable Real Estate Press Release: “$25.57 Million in Financing for Center City Philadelphia Office Building“
- Philadelphia C-PACE: “100 Independence Mall West Deal Fact Sheet and Notice“
- Net Zero Offices: Adding solar to building automation.
How to Get Started
- Work with professional to identify potential measures that increase efficiency and generate energy.
- Review tenant leases for pass-through option.
- Submit itemized cost of proposed measures and projected utility savings to CounterpointeSRE for cost benefit analysis report and eligiblity review.
- Work with CounterpointeSRE to optimize annual operational cash flows and building performance.
- In NNN and other lease structures, work with CounterpointeSRE to optimize cash flows and benefits for tenants.