Abstract

http://ssrn.com/abstract=1480215
 
 

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Doing Well by Doing Good? Green Office Buildings


Piet M. A. Eichholtz


University of Maastricht - Limburg Institute of Financial Economics (LIFE)

Nils Kok


University of Maastricht - Limburg Institute of Financial Economics (LIFE)

John M. Quigley


University of California, Berkeley, College of Letters & Science, Department of Economics; University of California, Berkeley, Haas School of Business, Real Estate Group (deceased)

August 1, 2009

American Economic Review, Forthcoming

Abstract:     
This paper provides the first credible evidence on the economic value of the certification of “green buildings” - derived from impersonal market transactions rather than engineering estimates. Our analysis of clusters of certified green buildings and nearby comparables establishes that buildings with “green ratings” command substantially higher rents and selling prices than otherwise identical buildings.

Moreover, variations in the premium for green office buildings are systematically related to their energy-saving characteristics. An increase in the energy efficiency of a green building is associated with a substantial increase in selling price - over and above the premium for a labeled building. Further evidence suggests that the intangible effects of the label itself may also play a role in determining the values of green buildings in the marketplace.

Keywords: environmental sustainability, energy efficiency, green labels, real estate

JEL Classification: G51, M14, D92

working papers series


Not Available For Download

Date posted: September 29, 2009  

Suggested Citation

Eichholtz, Piet M. A. and Kok, Nils and Quigley, John M., Doing Well by Doing Good? Green Office Buildings (August 1, 2009). American Economic Review, Forthcoming. Available at SSRN: http://ssrn.com/abstract=1480215

Contact Information

Piet M. A. Eichholtz
University of Maastricht - Limburg Institute of Financial Economics (LIFE) ( email )
P.O. Box 616
Maastricht, 6200 MD
Netherlands
+31 43 3883648 (Phone)
+31 43 3258530 (Fax)
Nils Kok
University of Maastricht - Limburg Institute of Financial Economics (LIFE) ( email )
P.O. Box 616
Maastricht, 6200 MD
Netherlands
John M. Quigley (Contact Author)
University of California, Berkeley, College of Letters & Science, Department of Economics ( email )
Berkeley, CA 94720-3880
United States
510-643-7411 (Phone)
510-643-7357 (Fax)
University of California, Berkeley, Haas School of Business, Real Estate Group (deceased) ( email )
Berkeley, CA 94720-1900
United States
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