Green leasing is surprisingly revolutionary. Despite the retail clamor for sustainable building and policies, leases rarely incorporate environmental standards into the legal language.
In the SPECS session, “Collaborating for Sustainability,” the Retail Industry Leaders Association (RILA) presented its case on the importance of building in leasing clauses that promote environmental efforts. Adam Siegel, VP sustainability and retail operations for RILA, was joined by a pair of retailers — Maria Barr, manager of global sourcing operations for The Disney Store, and Bob Jensen, director of construction for Family Dollar – to discuss where the industry is in terms of sustainable leases, and how they are working to help the movement gain traction.
“There is a disconnect between the landlord and the tenant,” RILA’s Siegel said. “Tenants want to install energy-saving devices and increase recycling rates, but most of the time those programs are not regulated by the lease.”
That’s not to say that landlords aren’t on board. In fact, that is where the greatest disconnect is, said the panel. The right hand (retailer) is unaware of what the left hand (landlord) is doing. And vice versa. The answer lies in green leasing.
According to Siegel, there are five reasons for a green lease:
1. Improve base building efficiency;
2. Align incentives for waste/energy reduction;
3. Improve tenant space;
4. Increase utility usage transparency; and
5. Clarify access and control of key spaces.
Disney has been a leader in the green leasing charge.
“At Disney, we knew we had to collaborate with our landlords, as well as our merchant teams and production/sourcing teams for all sides of the environmental equation,” Barr explained.
The company created a pilot project in several shopping center stores to test feasibility of increased recycling. It’s in the very early stages, but it’s about turning challenges into opportunities, Barr told the audience.
Bob Jensen, who wears the sustainability hat for Family Dollar, has set a goal to develop a thoughtful green lease that contains negotiable and non-negotiable items that are designed to impact a building’s environmental and energy goals.
“We have to keep asking, ‘What if?’ in order to move this initiative forward,” Jensen said.