Mr. Bell

Development & Construction

Trends in Green Construction in the Hospitality Industry

By Rollin Bell, Founder / CEO, PCM Construction

Over the past decade, the hospitality industry - like the rest of the commercial real estate industry - has begun incorporating the use of environmentally friendly, green materials into the design and renovation of existing spaces. The result has been new hotels that are not only aesthetically pleasing - but also sustainable buildings that are making a positive impact on the communities in which they are located.

The breakthroughs in green construction have been remarkable. Some international hotels, for example, have been able to reduce energy costs by constructing sod roofs consisting of mud and other organic materials. Other hotels have found ways to minimize waste runoff through innovative engineering techniques, while still others have increased energy efficiency through use of natural and ambient lighting.

Driving the current trend in green construction is the U.S. Green Building Council (USGBC) which has established standards for the commercial real estate industry through the Leadership in Energy and Environmental Design (LEED) rating system.

The LEED system is particularly effective because it awards credits to six categories: sustainable siting, water efficiency, energy and atmosphere, materials and resources, indoor environmental air quality, and innovation in design. Each structure achieves a LEED certification level ('certified,' 'silver,' 'gold,' or 'platinum') based on how many points it scores in each of these categories.

These points - which translate into tax savings for businesses that choose to incorporate the credits - provide a strong incentive for hotel executives to consider going green during their next construction or renovation project.

Credits notwithstanding, several other great incentives exist for hotel executives who wish to adhere to environmentally-friendly standards. One is energy efficiency. Natural and ambient lighting, for example, has helped some commercial properties reduce up to 40% of energy costs.

Another consideration is that environmentally friendly properties are steadily gaining market share among a new segment of travelers. According to the environmental activist group, The Zero Waste Alliance, in the United States alone, more than 43 million tourists consider themselves "eco tourists." By creating new environmentally-friendly hotel destinations, hotel executives now have an opportunity to market their properties in a way that differentiates them from competitors.

Going Green

So, as a hotel executive committed to making your next renovation or construction project environmentally-friendly, what are the next steps? First, you need to find a team of architects, designers and contractors with experience in green construction. Importantly, your team should have relationships in place with suppliers and subcontractors who are knowledgeable about the LEED point system and can help you develop a comprehensive strategy.

Next, before starting the project, a good practice for hotel executives is to assign a checklist that will help itemize your materials and determine their value. If, for example, you are considering a renovation project, an important component to your plan will be waste removal. This component should include an itemized list of the building materials that you will be extracting from your hotel and match LEED points to each.

Drywall, for example, is a building material that can occupy a lot of space in a landfill and therefore provides significant credits under the LEED systems. By separating out drywall from wood during a renovation, and recycling the material, hotel executives can sometimes actually save more money than by simply disposing of it. Other building materials that can help generate returns through recycling include metal and carpeting.

This part of the waste management plan mainly applies during demolition, when building can be sent to one of few recyclers that handle drywall. The advantage is that drywall is heavy and results in more LEED points during demolition as part of the waste management plan. This plan is to divert as much of the demolition debris from regular landfills as possible. For example, a project may have to divert 70% of its waste in order to achieve a LEED Silver rating.

Sensitivity analysis can be performed to identify tradeoffs between savings created by LEED points and transportation costs. (i.e. the cost of cutting up drywall into small pieces for recycling may actually outweigh the cost benefits of the points). These decisions need to be made on a case-by-case basis and evaluated within the context of your broader plan.

In addition to the waste management component, another area where LEED points can be an important part of your construction strategy is in the selection of materials. For example, one of things that the USGBC promotes is the use of environmentally-friendly appliances - such as certain models of air conditioners.

If you are considering developing a green construction plan for your property, it may be worthwhile to research which types of appliances will earn credits for your hotel. Pay special attention to the geographic proximity of these suppliers to your hotel because you can also sometimes earn LEED points based on location.

Although this article really just scratches the surface of green construction planning and the benefits of the LEED system, it is intended to offer insight into what has become a growing industry trend. At face value, green building initiatives may appear to be more costly than traditional construction techniques for the development or renovation of a hotel property. But to overlook the potential benefits of green building is not only myopic from an environmentally responsible perspective, but from a business standpoint as well. Green construction has proven to be a worthwhile investment for many U.S. hotels in terms of long term savings and do not show any signs of slowing down into the future.

Rollin Bell is founder and CEO of PCM Construction, a full service general contractor serving the Washington, D.C. and Baltimore regions. PCM provides interior construction and other design/build services. Mr. Bell is a 2006 Ernst & Young Entrepreneur of the Year finalist and serves on the board of BAPS Imagination Stage, an organization committed to making the arts accessible to all children regardless of their physical, cognitive or financial status. He is a contributor to several charities including The Cystic Fibrosis Foundation. Mr. Bell can be contacted at 301-595-3700 or rbell@pcmgc.com Extended Bio...

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