Best Practices Construction Law : Construction Lawyer & Attorney : Matthew DeVries : Stites & Harbison Law Firm : Green Building & LEED Litigation

A few weeks ago I received my diploma in "moderating panels for non-profit groups that support research and education in real estate and urban land use" when I received call from Nashville ULI to moderate a local panel on the emerging trends in the real estate market.  Lucky me!  Lucky them!

This morning, ULI Nashville presented its highlighted event, "Real Estate Outlook 2012 featuring Emerging Trends in Real Estate."  ULI's annual report, available for download, reflects the views of leading real estate executives from around the world who completed surveys or were interviewed as a part of the research process for the reports. Interviewees and survey participants represent a wide range of industry experts—investors, developers, property companies, lenders, brokers, and consultants.

This year, ULI Nashville was proud to host Dean Schwanke, Vice President and Executive Director, ULI Center for Capital Markets and Real Estate.  Dean oversees and coordinates ULI's work on real estate finance and capital markets issues, including books, Emerging Trends reports, online content, continuing education programs and sessions at ULI meetings and conferences.  Among many other items, Dean highlighted two emerging trends for the new year:

• For 2012, real estate investors must resign themselves to a "slowing, grind-it-out economic recovery following a period of mostly sporadic growth."  This is confined largely to a few real estate markets that offer the primary 24-hour transportation hubs with global access.
• "Well-leased core real estate in leading markets will continue to produce solid single-digit, income-oriented returns." According to the report, more opportunistic investors will ratchet down forecasts – even projections of returns in the mid-teens appear to be a stretch as risk increases from questionable supply/demand fundamentals.

Local panel members included Bert Mathews of The Mathews Company and Charles Carlisle of Bristol Development Group. 

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When Nashville Mayor Karl Dean created the Green Ribbon Committee on Environmental Sustainability, he had lofty goals of making Nashville the greenest city in the Southeast.  Indeed, Tennessee's Lt. Governor Ron Ramsey shared a similar commitment to be a green "LEEDer" in the South. 

Fast forward to January 2010 ... Where are we on the green front?  What have we learned over the past year?  Where are we going in the future? Have we met any goals outlined in the Green Ribbon Committee report?  How have the current real estate market conditions impacted the short-term future of green building in Nashville?  Is it time to require some sort of mandate for green buildings or are incentives enough? 

Yesterday morning a group of community leaders, developers, bankers, attorneys, engineers, contractors and other green players met for breakfast at Waller Lansden's sustainability breakfast series to tackle these questions. The panel included the following: 

• Jimmy Granbery,CEO, H. G. Hill Realty Company, LLC
• Mike Jameson, Councilmember, Metro Nashville Council District 6
• Bert Mathews, President, The Mathews Company
• Joni Priest, Metro Nashville Planning Department
• Sharon Smith, Metro Nashville Mayor's Office, Director of Office of Sustainability 

The one-hour discussion was very thought-provoking and the panelist had some practical comments on the future of green building in Nashville.  Here are a few:

On the progress of green building:

Jimmy Granbery applauded the development of technology and better understanding of green solutions.  "For example, we can now build a green roof with only four inches of dirt rather than two feet of dirt," said Granbery.  This has certainly resulted in significant cost savings in the underlying materials, as well as the building costs such as the steel needed to support a heavier roof.

On city or state-wide green building code:

Councilmember Mike Jameson discussed the problem that localities face by adopting a third-party building code such as USGBC's LEED certification, suggesting that the building code will have to change as the third-party standard changes.  "Instead, I would like to see the city code mirror the [third-party version] ... to be a stand alone code," said Jameson.

On local incentives for green building:

Joni Priest highlighted some potential incentives, including bonus square footage for LEED certified buildings and building height variances.  Priest said  that there was significant opposition to any mandate for LEED certification on construction, joking that her phone rang off the hook when the mandate issue came up for discussion.

On general trends for green building and sustainable design:

Bert Mathews said that it really depends on the client, as some tenants of his developments have absolutely no interest in green building, while for others, "it is a standard that many have come to expect."

Question:  How would you rate Nashville's commitment to green building?

I look forward to the sustainability breakfast series over the next few months.  Thanks to @tenngreenlawyer for the tweet about the breakfast.

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