Market Overview

Green Building Certifications at All Time High in Nation's Largest Metros

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Chicago Repeats, Widens Lead as Nation's Greenest City

The nation's largest cities are getting even greener, according to the
fifth annual U.S.
Green Building Adoption Index
by CBRE
and Maastricht
University
. Researchers have found green certified office space
across America's 30 largest metros has reached 41 percent of market
totals – the highest in the index's history.

This press release features multimedia. View the full release here:
https://www.businesswire.com/news/home/20180823005204/en/

"Green" office buildings in the U.S. are defined as those that hold
either an EPA ENERGY STAR® label, USGBC LEED certification or both.
According to the report, 11.5 percent of all buildings surveyed are
ENERGY STAR labeled, while 5.2 percent of buildings are LEED certified,
both at all-time highs for the five-year study.

Chicago again claimed the top spot with nearly 70 percent of its space
green certified. In addition to defending its title as the nation's
greenest city, Chicago saw a difference of nearly six percent with
second-place San Francisco, the largest spread ever recorded in the
Green Building Adoption Index. Atlanta maintained the third spot with
more than 58 percent of all space green certified, while a surging Los
Angeles claimed fourth – up from sixth last year. Minneapolis rounds out
the top five with 55 percent of office space certified.

"From moving to 100 percent renewable energy in our public buildings, to
supporting our private partners as they work to reduce emissions,
Chicago is showcasing to the world the impact that cities can have on
climate change for their residents and for people around the world,"
said Chicago Mayor Rahm Emanuel. "This national recognition is a
testament to the progress and success of our efforts to improve our
environment while bettering communities across Chicago."

RANK   MARKET      

TOTAL # OF

BUILDINGS

     

TOTAL SQ. FT.

     

TOTAL # GREEN

BUILDINGS

     

% OF MARKET

CERTIFIED GREEN

1   Chicago       1,435       236,516,240       265       69.8%
2   San Francisco       1,386       120,434,025       286       64%
3   Atlanta       908       132,828,235       251       58.4%
4   Los Angeles       1,664       206,051,367       363       56.3%
5   Minneapolis       476       69,950,658       102       55%
                         

Continued improvement in average energy efficiency for the nation's
commercial buildings also prompted the EPA to change the underlying
calculations for ENERGY STAR scoring this year. This change is expected
to lower average scores for office buildings by as much as 10 points
next year. These changes may have a significant impact on next year's
Green Building Adoption Index rankings, particularly for markets whose
ENERGY STAR certifications comprise the bulk of their green space.

"Green building certifications have become an important proxy for
sustainable practices, recognized by all stakeholders. Any significant
change to one of these major certification programs can have a
significant impact on the buildings affected. We will be closely
watching for the results," said David Pogue, CBRE's Senior Vice
President, Global Client Care.

Green Buildings Certification Influencing Capital
Markets

CBRE and Maastricht University researchers note that building
certification has become a more recognized and important part of a
building's profile. As these programs reach maturity, the capital
markets are increasingly incorporating these certificates into loan
pricing and alternative financial instruments such as green bonds. And,
according to additional research by Green Building Adoption Index
co-author Rogier Holtermans, buildings certified by ENERGY STAR and/or
LEED have been shown to transact for about 10.1 percent more than
non-green certified buildings.

In fact, in 2018, for the first time in the four-year history of CBRE's
Investor Intentions Survey
, more investors said sustainability is an
important criteria in asset selection than said it was unimportant. This
reflects a gradual trend of increasing investor interest in
sustainability.

On the lending side, there have been significant advances to integrate
green building certification into financing programs, and some lenders,
like Freddie Mac and Fannie Mae, are adapting their rates based on the
presence or absence of green building certification. Freddie and Fannie
are providing pricing breaks in the range of 10-30 basis points to
multifamily assets that are rated by one of eight different green rating
schemes.

"For investors and lenders in the commercial real estate sector, green
building certification affects their cost of capital. The rationale is
that such buildings have a more attractive risk profile, and may be more
resilient when economic headwinds arrive," said Dr. Nils Kok, associate
professor at Maastricht University.

This is the fifth release of the annual U.S. Green Building Adoption
Index. Based on a rigorous methodology, the index shows the growth of
ENERGY STAR- and LEED-certified space for the 30 largest U.S. office
markets, both in aggregate and in individual markets, over the previous
10 years. A feature again this year is a geographic mapping platform
that highlights the name, location and details of the specific green
certification for each building in all 30 markets. View the study's
findings HERE.

About CBRE Group, Inc.

CBRE Group, Inc. (NYSE:CBRE), a Fortune 500 and S&P 500 company
headquartered in Los Angeles, is the world's largest commercial real
estate services and investment firm (based on 2017 revenue). The company
has more than 80,000 employees (excluding affiliates), and serves real
estate investors and occupiers through approximately 450 offices
(excluding affiliates) worldwide. CBRE offers a broad range of
integrated services, including facilities, transaction and project
management; property management; investment management; appraisal and
valuation; property leasing; strategic consulting; property sales;
mortgage services and development services. Please visit our website at www.cbre.com.

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