General: the cost savings of green buildings

Lately the key word in almost any industry is “green.” Green banking, green vehicles, green logistics, green energy. In real estate and construction here in Japan, it’s no different. Having a green building can save you money on operating costs, thus driving up your net yield.

To be fair, Japan has always been a pretty environmentally friendly place. With limited natural resources of its own, Japan has had to historically build energy efficient buildings. Almost all energy-producing resources are imported, so in order to keep energy costs manageable for the end user, Japan has invented technology already that helps limit the local’s ecological footprint.

For anyone who has lived here or visited here, things like the ability to turn your gas off when hot water is not needed is one piece of technology that has been around for decades. Large appliances here have always been more energy efficient than their counterparts in other, energy-rich countries. Central heating is a rarity in any locale as it is seen as inefficient. The thinking goes; why control the temperature in rooms no one uses regularly? Instead, room specific heating and cooling units are used as needed.

Even efforts like “Cool Biz” in the summer, a period between June and September where workers are encouraged to take off their neck ties so the air conditioners can be set at no lower than 28 degrees to save energy have been introduced. Government organizations were the first to implement this followed by the private sector.

These efforts have turned Fukuoka City into a water conserving municipality. In today’s terms, despite the population growth of the city over the last 30 years, current water consumption levels are at the same levels seen after the drought. Back then, water consumption levels weren’t enough to support everyday life and many businesses were forced to close their doors. Now, given the reforms, not only does the same water consumption support the existing infrastructure, it can also handle further growth. What this translates to on an individual building level is less operating costs due to an increased investment during construction for water-saving technology. This isn’t an experiment but an implemented plan that over the last three decades has put Fukuoka City’s water consumption levels at 60% the national average.

Environmental pollution tends to have several stereotypical culprits such as the automotive industry and big oil, but the average building emits more global warming contaminants than all other sources combined. Owners are now offered a lot of incentives with Japan set to be the global pioneer in how to build greener buildings. As it stands now, Tokyo offers the highest gross yields and the cheapest real estate in Asia. Implementing green building practices when investing can lower operating costs thus driving up your net yield.

Source : JapanToday

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