New York’s Green Giant

New York’s Green Giant

Perhaps you’ve heard. New York’s iconic landmark, The Empire State Building, is undergoing a radical transformation: a $550 million renovation incorporating a comprehensive energy efficiency retrofit. The highly-publicized project is projected to save 38 percent of the building’s energy, reduce carbon dioxide emissions by 105,000 metric tons over the next 15 years and lower building costs by $4.4 million annually. That makes the building’s tenants happy, and it’s also good for the City of New York.

A whopping 65 to 70 percent of New York City’s carbon emissions are projected to come from buildings, whereas very few examples of pre-war commercial building energy retrofits exist anywhere in the United States. That means the Empire State Building is literally clearing a path for thousands of other buildings to follow. It happens to be doing so with a visible commitment to the principles behind the sustainability movement – people, planet and profit.

In an effort to build stakeholder advocacy and encourage more commercial buildings to initiate similar energy retrofit initiatives, owner Anthony Malkin of Empire State Building Company has made a remarkable commitment to transparency.  He has decided that the company will share all of the new processes and technology it develops and lessons it learns during the retrofit with the public. “It is my hope that people will be able to take a look at what we did here and be able to replicate the process,” he says.

During the course of the retrofit, stakeholders can gain access to behind-the-scenes information, including the models and decision-making tools used to make the Empire State Building’s green retrofit possible. An interactive retrofit puzzle demonstrates how taking the right steps, in the right order – from refurbishing the building’s 6,500 windows for maximum overall energy use, to installing energy management systems that allow tenants to access energy use data, obtain online tips and benchmark themselves against other tenants – makes all the difference when it comes to increasing efficiency. The company even updates key learning obtained during the process of the retrofit, as well as its ongoing engagements with thought partners Rocky Mountain Institute, the Clinton Climate Initiative, Johnson Controls, Inc., and Jones Land LaSalle.

Thus far, the project takeaways are quite compelling. For one thing, there is the importance of taking a “whole building” approach to design. “The good work which has been done to date [in green building retrofit] has focused on individual elements – a lighting system, a cooling tower,” Malkin explains. “You have to look at how all the elements – the lights, the cooling tower, the insulation – work together. You then look for the combination of measures which creates the greatest savings with the shortest payback period.”

Taking a whole-building approach to the retrofit design was beneficial in that it allowed Malkin’s team to stay within budgetary parameters. The team started by identifying baseline budgets for 23 existing retrofit-related projects. They then examined how sustainable alternatives could affect costs. For instance, the team found big-ticket cost-savings items on six projects, including a multi-year cooling and air handling replacement system, central cooling plant replacement, exterior tower lighting and mid-pressure steam riser replacement. [For an interactive model of how these technologies work cohesively together to save energy, click here.]

The Value of Green
While each one of these technologies improves the building’s environmental performance – reducing greenhouse gas emissions, chemicals and pollutants while increasing air quality and recycling – a principle motive behind the energy retrofit is long-term value. Malkin envisions green buildings as higher quality buildings – buildings that produce superior cash flow resulting from reduced energy costs and tenant’s desire for a better way of living. If only sustainability were marketed that way.

“I am so tired of the directional and qualitative nature of the sustainability effort,” says Malkin. “We need to get away from this idea of ‘doing the right thing’ without quantifying what the right thing is. There is way too much dogma and what we need to get to is dollars and cents. Watts and BTUs.”

Dollars and cents wise, Malkin expects to gain a lot more than saved energy from his retrofit project. In addition to driving down utility, maintenance and repair costs, improvements on The Empire State Building are projected to result in increases in rent and occupancy rates due to enhanced value on updated services. Further income is also expected from new tenant offerings such as chilled water.

To achieve such financial upsides in green building, one has to think holistically. Malkin swears by his systemic approach: “Green to me is a set of practices,” he explains. “It’s recycling tenant waste, it’s recycling construction debris, it’s green pest control, it’s green cleaning solutions, it’s using recycled materials in your build-outs and in your common areas. These things can be done at a similar cost in dollars and they are definitely less painful to the environment.  Quantifiable energy efficiency retrofits are different…they are energy saving and money making for the landlord and tenants.”

Malkin’s perspective is that ultimately, there is nothing “ungreen” about the idea of urban living. But in the mainstream environmental movement, green is rarely associated with towering steel skyscrapers. Changing the population’s mental imagery is a core objective of Malkin’s. That is why, as part of the Empire State Observatory visit, the company is putting together a walk-through explanation of the retrofit program, to give people a sense of how the environment they are in works in harmony with what supports and surrounds it.

“I had a series of museum installation designers come and present some ideas for the walk-through,” Malkin explains. “One of the elements suggested was visually projecting a “canopy of trees” on the top of the elevators, so there’s an image of green as you’re looking up. I said, “get rid of the trees!” One of the biggest problems is that people think of the environment as someplace you go to visit, and then you come back to your life.”

The refurbished Empire State Building represents a new way of urban life – a new American ideal. As President Bill Clinton recently said in a video describing the retrofit: “This project is not only good for the earth, it also makes real financial sense. If even a fraction of the buildings in the United States or our world were to carry out similar ones, the impact would be profound. More projects like this will continue to create incredible opportunities for change across America, and across the world.”

Christine Arena is the author of
The High-Purpose Company - The Truly Responsible (and Highly Profitable) Firms that are Changing Business Now. Like what you just read? Get your daily dose of corporate insights.

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