A new study by District, Measured reveals that LEED-certified multifamily buildings in DC carry a rent premium compared to their non-LEED counterparts.
Although multifamily projects are exempt from DC's LEED certification requirements, 27 have been certified since 2000, accounting for 30 percent of new multifamily buildings built in that time. On average, effective rents were 15.2 percent higher in 2018 for LEED-certified buildings than non-LEED buildings, creating a premium of 45 cents per square foot.
The premium was 14 percent for lower-tier LEED-Certified and -Silver buildings, and 17.8 percent for higher-tier LEED-Gold and -Platinum buildings. The study also observed that units in LEED-certified buildings tend to be an average of 68 square feet smaller than those in non-LEED buildings, and that residents of LEED-certified buildings tend to have annual incomes $10,533 (or 11.7 percent) higher than tenants of non-LEED buildings.
The study compared 22 LEED-certified buildings constructed between 2008-2018 to 21 non-LEED buildings in similar locations with similar age, size, vacancy rates, unit mixes, amenities, etc. While the rent premiums were statistically significant, the study also does not attribute the premium solely to LEED certification. UrbanTurf also notes that acquiring LEED certification from the US Green Building Council is a costly process, and some multifamily buildings are constructed to those standards without registering to seek certification.
This article originally published at https://dc.urbanturf.com/articles/blog/the-45-cent-leed-rent-premium/15478.
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