Contractors, large and small, need to prepare themselves to do business in an increasingly green marketplace
By Mary Buckner Powers
Above and below: Reflections, a 263-unit condo project in Bloomington, Minn., was completed in 2006 by McGough Construction, St. Paul. It is the first phase of a 50-acre development that will be submitted as a pilot project for the LEED neighborhood development program.
Construction is going green at high speed. The U.S. Green Building Council predicts that the value of green construction will exceed $12 billion in 2007, while membership in the council nears 12,000, a 10-fold growth since 2000.
Atlanta-based Holder Construction’s certified-green projects jumped 256% in one year. “The growth is exponential,” says Beth Studley, vice president. “Owners are telling us they want to go green.”
Owners across all markets are demanding green, agrees Chris Davis, project manager at Austin Industries, Dallas, which just completed a manufacturing plant for Texas Instruments. “It’s a revolutionary change in the industry,” he says.
The market news is good, but contractors need to prepare, say industry sources. “It’s not as simple as buying the guidelines,” Studley says. “We have 100% dedicated people to support the project teams.”
Savvy contractors who want to get out ahead of the pack understand they have to get the sustainable-building principles figured out before they become even more commonplace, says Thomas Taylor, president of Vertegy, Alberici Constructors’ green consulting firm in St. Louis. “They have the luxury of time now. They won’t have it later on,” he says.
Today, standards and guidelines that define a green building or its components are available through USGBC’s Leadership in Energy and Environmental Design (LEED) program; Green Globes, an online analysis tool; the U.S. Environmental Protection Agency’s STAR and Building for Environmental and Economic Sustainability programs, and a handful of others. LEED has points that can be attained to achieve its basic certifications and silver, gold and platinum levels.
Taylor says green construction is a great opportunity for contractors. “This is the first time in a long time that we have the opportunity to regain our title as master builder,” he adds. “There are 69 LEED points and prerequisites. Contractors directly affect one of the prerequisites and 27 other points. We’re problem solvers. This is an opportunity for us to be recognized for what we can add to a project and shift the model to value us for our intellect, not just our hands,” Taylor says.
Builders have to be smart as they get into green construction and can take on undue liability if they’re not careful, Taylor says. “When I talk to contractors, I tell them that the most important thing is to learn it, practice it, teach it,” he says.
One pitfall that an unwitting contractor can fall into is poorly written specifications, Taylor says. If the contractors do not know what is necessary to meet the green requirements, they could face undue risk, especially if they are responsible for meeting those requirements under the contract.
For example, if contractors do not know what products meet LEED requirements and do not include the proper products in their bids, they may not be eligible to be reimbursed for the difference, Taylor says. “You have to go in with your eyes wide open,” he adds.
The payoff for contractors educating themselves in the green-building arena is that it will set them apart from others. “They can be the go-to contractor for this type of work,” Taylor says. That’s a good place to be in a market that is expected to be a $60-billion industry by 2010, he says. “In addition, for every LEED-certified building, there are at least 10 that are built following the guidelines but not seeking certification,” Taylor notes.
Support Systems
Associated General Contractors chapters around the country are developing programs and workshops to help contractors become familiar with sustainable construction. In St. Louis, the chapter is looking at a project from start to finish and holding workshops on such issues as achieving certification, says Joanne Engel, AGC of St. Louis’ assistant director for training and apprenticeships.
The chapter also helps with such issues as how to prepare bids and what it takes to become a LEED-accredited professional. That distinction is awarded to professionals who have passed an exam costing $250 for USGBC members to take, $350 for nonmembers. There are no prerequisites for taking the exam, but USGBC recommends experience on a project.
AGC of America, with USGBC as adviser, is developing a curriculum for a one-day program to explain the LEED rating system. The program will be unveiled at AGC’s 2008 convention in Las Vegas next March.
AGC also will publish a book on green construction, which will be available at the convention. It will discuss how green elements affect construction practices.
Size Doesn’t Matter
Alberici's platinum-rated headquarters in St. Louis was built for the same cost as a traditional building. It was the greenset LEED-rated building in the world with 60 points until the Aldo Leopold Legacy Center was certified in October.
Smaller contractors, as well as large ones, can find opportunities in sustainable construction. “You don’t have to be a Turner Construction to do green,” says Gary Tulacz, Engineering News-Record’s senior editor who compiled ENR’s new list of the Top Green Contractors. “You just need one or two accredited professionals on staff.”
Creative Contractors, a Clearwater, Fla., company that averages $50 million in volume a year, has incorporated green elements into its normal construction practices, which puts the company into a preferred position as a sustainable builder, says Joshua Bomstein, vice president of business development. Best practices include using regional products, recycling construction waste and meeting air-quality protocols during construction. “We would be ashamed not to do it,” he says.
Gilbane Building Co., Providence, R.I., has a goal of getting everyone in its organization LEED accredited. More and more of the company’s clients are asking for team members who are LEED accredited, and the company wants its people educated, says Mark Winslow, regional services manager.
Austin Industries, Dallas, built Texas Instrument's new platinum-rated office building. TI also is building some of its manufacturing plants to meet sustainable criteria.
If they don’t understand the process, team members “can get tripped up,” Winslow says. Many of the green submittal requirements are specific to contractors, and if not done properly, can cost a project LEED points.
The company has a sustainability advisory committee, headed by Tom Gilbane, chairman and CEO, that looks for initiatives the company can take to improve its delivery of green projects. It has its own energy-modeling process for mapping out energy efficiency, which it adapts to each project to improve efficiency.
The advisory committee looks at how the company can improve itself. “We’re looking at our own carbon footprint to see what it is and what we can do to reduce it,” Winslow says. The company also has a corporate goal to recycle 50% of its construction waste and improve the indoor-air quality at all of its construction sites.
Another way to avoid problems when building green projects is to get on board during the early stages of a project, says Brad Wood, executive vice president of marketing at McGough Construction, St. Paul, Minn. The owner, designer and contractor should work together from the beginning rather than trying to force-fit the project after it is designed, he says.
Both design-build and construction manager-at-risk are good delivery methods for a successful project, says Ken Potts, McGough’s director of sustainability. The checks and balances of the designer and contractor working together improve the project, he says.
Key features of the Aldo Leopold Legacy Center, built by The Boldt Co., include its energy-efficient design, use of locally harvested wood products and carbon-neutral operations.
Having one person responsible for specific LEED points also helps projects succeed. McGough has sustainability specialists that work with project managers to be the “bulldog” on the projects, Wood says.
It’s also important to demystify LEED, says Dan Osterman, McGough’s chief estimator and a candidate for USGBC’s board. “It needs to be in the forefront of everyone’s thought processes without being complicated,” he adds.
McGough has developed internal practices, field practices and even a green building center of excellence to position itself as the company of choice for owners interested in green construction.
New Direction
McGough, like others, sees the next few years as a transition period for green construction. “Soon, it will be common practice,” Wood says. “LEED has helped us focus and has given us guidelines, but owners already are asking for the work to be done without being certified.”
Texas Instruments, Dallas, is moving in that direction, says Paul Westbrook, sustainable development manager for TI’s worldwide construction. “LEED certification forces you to do it right,” Westbrook says. “But it also takes time away from doing more good things.”
TI does not do anything specifically to earn LEED points, but it pursues sustainable components based on what makes good financial sense for the company or what is good for the community, Westbrook says.
"We're a business and we want to be competitive. Sustainable construction works, and it makes good economic sense for us."
— Paul Westbrook, Sustainable Development Manager, Texas Instruments
The company has several projects working toward LEED certification, including a 1-million-sq-ft manufacturing plant in Richardson, Texas. It will seek LEED certification on two projects under way in the Philippines, including an 800,000-sq-ft assembly and test plant. Next, it plans to pursue two renovations of existing buildings that will be LEED pilot projects, including an office building and a manufacturing plant.
T0 knows that sustainable projects affect the bottom line by reducing operating costs, but there are many benefits that are nearly impossible to measure, such as increased productivity, healthier workers and the ability to attract and retain good workers, Westbrook says.
When Contractors Become Building Owners
The Boldt Co.
Some benefits don’t transpire when owners have a bias against best value, says Thomas Boldt, CEO of the Boldt Co., Appleton, Wis. “There are endless opportunities to shave costs off a building but in that equation of operational costs, life-cycle costs are forgotten,” he says.
When Boldt looked at the life-cycle costs for two new office buildings it planned to build for itself in Wisconsin and Oklahoma, the analysis showed the added investment to build it to LEED-silver standards would be paid back in less than one year. Boldt now is a true believer in sustainable construction, he says.
The benefits for owners who choose to add sustainable features are often astounding and hard to quantify. “Our employees enjoy working in good-quality air,” Boldt says. “A good place to work also helps attract and keep good people.”
Culturally, Boldt Co. has always promoted best-value selections and counseled owners about its benefits but Thomas Boldt now thinks the construction industry should promote sustainable construction. “We have a tremendous opportunity to demonstrate we are thinking smarter and using resources in the most effective way,” he says.
Boldt has just completed the Aldo Leopold Legacy Center, which Rick Fedrizzi, president, CEO and founding chairman of the U.S. Green Building Council, confirmed is the most green building in the world. It is the first to earn a LEED credit as carbon neutral and already has earned $650 by producing geothermal energy to sustain itself, with enough left over to sell to the local utility.
“We need as an industry and a society to be more aggressive about closing these loops, reducing waste and driving for efficiency,” Thomas Boldt says.
Alberici Enterprises
John Alberici, chairman of Alberici Enterprises, St. Louis, says the financial paybacks for a sustainable building are just the beginning of what’s good about his company’s three-year-old green headquarters. “The experience of working in a place that’s healthful, open and full of daylight is inspiring,” he says.
Alberici had been told that employees would be more productive in the sustainable building, but he was surprised to find the absenteeism rate for the workers who transferred from the company’s old headquarters had declined 50% after a year. “It was the same the second year,” he says.
The reduced absenteeism at government contractor Lockheed Martin’s plant in Sunnyvale, Calif., in one year paid for the elements to make the building sustainable, Alberici says. “So it can have a material effect that doesn’t show up on the utility bill.”
The Alberici headquarters is designed to give all employees a 100% view of the outdoors by pushing bathrooms, conference rooms and other areas that need to be closed into the center of the building. Alberici, like all of his employees, works from a cubicle with low walls that don’t obstruct the views.
“From my experience, it has sent a message to the community. It shows our leadership in the industry. Owners see it and they know we’re innovative,” Alberici says.
Alberici’s certified LEED-platinum headquarters was built at the cost of conventional
construction. It achieved 60 points out of a possible 69, and it was the highest rated LEED building in the U.S. until it was displaced by the Aldo Leopold Legacy Center in Baraboo, Wisc., which was certified in October with 61 points.
“I was surprised at how much we could do on so little budget to give people such a great work experience,” Alberici says.
