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THE BENEFITS OF GREEN LEASE ADOPTION The adoption of green leases brings multifaceted benefits, driving a positive impact on the environment, financial health, and stakeholder relationships. By adopting green leasing practices, the energy efficiency gap can be filled, and utility consumption in offices across the country reduced—with the potential for landlords and tenants to realize significant savings. 01 Increasing Property Value: Properties subject to green leases typically experience an increase in value. These buildings attract tenants more easily, command higher rents, and have lower vacancy rates due to their enhanced sustainability features and operational efficiency. Energy expenses are rising faster than core inflation. Marketing that the property is designed to reduce wasted expenses will drive more leasing activity. Regulatory Compliance: With governments globally tightening regulations on energy use and sustainability in commercial spaces, green leases provide a proactive framework for compliance, reducing the risk of penalties. Industry Recognition & Acclaim: Higher- performance buildings can increase ENERGY STAR and LEED scores, as well as assist with achieving other certifications such as BOMA 360, Fitwel, or WELL. Receiving industry recognition also helps a company retain and attract like-minded employees, tenants, investors, and other partners. Correcting Overtime HVAC Charges: In gross lease properties, green leases can ensure that the true cost of operating the property is reflected in utility bill backs to tenants. Overtime HVAC costs are often a hidden cost center with the rate charged for overtime HVAC calculated once and not updated for years, despite significant increases in cost to landlords. Correcting for the true cost either helps the landlord recover their full costs or encourages the tenant to reduce their consumption. For owners: 02 For tenants: Reducing Costs: Overall green leases create higher-quality spaces for tenants, who recoup their investment through lower utility bills and improved productivity and comfort. The Institute for Market Transformation (IMT) in the U.S. estimates that green leases can help reduce utility bills by up to 22 percent, or around 50 cents per square foot in U.S. office buildings alone. Regulatory Compliance: Like owners, tenants may need to comply with new climate regulations and building performance reporting. Green leasing can dictate that landlords must disclose any tracked common area energy or water use, and whole building ENERGY STAR scores with tenants, which can be crucial for reporting transparency. 03 Better Data Sharing, Better Results Data sharing, particularly around energy performance, is key to monitoring and measuring progress. It's in both the tenant's and landlord's interest to ensure data is as robust and accurate as possible. This provides greater visibility into what's working well, identifies improvement areas, and promotes goal setting based on actual performance results.

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