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An Analysis of the Local Construction Industry's Perception of the Costs of Leadership in Energy and Environmental Desig...

Permanent Link: http://ufdc.ufl.edu/UFE0024207/00001

Material Information

Title: An Analysis of the Local Construction Industry's Perception of the Costs of Leadership in Energy and Environmental Design (LEED) Construction
Physical Description: 1 online resource (111 p.)
Language: english
Creator: Forenza, Mathew
Publisher: University of Florida
Place of Publication: Gainesville, Fla.
Publication Date: 2009

Subjects

Subjects / Keywords: construction, contractor, cost, local, survey, sustainable
Building Construction -- Dissertations, Academic -- UF
Genre: Building Construction thesis, M.S.B.C.
bibliography   ( marcgt )
theses   ( marcgt )
government publication (state, provincial, terriorial, dependent)   ( marcgt )
born-digital   ( sobekcm )
Electronic Thesis or Dissertation

Notes

Abstract: ABSTRACT OF THESIS PRESENTED TO THE GRADUATE SCHOOL OF THE UNIVERSITY OF FLORIDA IN PARTIAL FULFILLMENT OF THE REQUIREMENTS FOR THE DEGREE OF MASTER OF SCIENCE IN BUILDING CONSTRUCTION AN ANALYSIS OF THE LOCAL CONSTRUCTION INDUSTRY?S PERCEPTION OF THE COSTS OF LEADERSHIP IN ENERGYAND ENVIRONMENTAL DESIGN (LEED) CONSTRUCTION By Mathew R. Forenza May 2009 Chair: Charles Kibert Cochair: Robert Ries Committee Member: James Sullivan Major: Building Construction The development of the sustainable building movement in the United States has gone through many different phases over the past four decades. The energy crisis of the 1970s led to legislation by the federal government in order to reduce the US demand of foreign sources of primary energy, such as oil. The legislation established standards for building energy efficiency use and led to the design of buildings which were sealed off from the exterior environment. As a result of the design, the energy use of a building dramatically reduced. However, the level of occupant comfort within the building reduced as well. Through the 1980s and early 1990s, many studies were performed in order to determine how to improve occupant health inside the building. The studies determined that an occupant?s level of health is determined by many different characteristics of the building, such as the amount of natural ventilation or the amount of daylight in a building. The establishment of the United States Green Building Council (USGBC) in 1993 brought the idea of sustainable buildings to the attention of members of the US Government and the academic community. The USGBC then developed a sustainable building scoring system known as the Leadership in Energy and Environmental Design (LEED). The initial LEED rating system was put to market in 1998. Presently, the LEED rating system is comprised of 11 different scoring systems that are categorized into building program types and functions. The general perception among the construction industry nationwide is that there is an additional cost to construct a LEED rated building when compared to a conventional building program. The reviews of some of the more widely accepted studies on the costs of LEED construction were included in the research as well. The majority of the studies however, neglect to mention the perspectives of the construction companies. Therefore, this study sought to determine the opinions of a major stakeholder of the construction industry. This thesis analyzed the local construction industry?s perceptions of the first costs that may be associated with the construction of a LEED building. The local construction industry includes companies throughout North Florida, and the majority of respondents were from Gainesville, FL. The study was conducted with a survey that was distributed through the local builder association?s commercial builder?s council members. The responses were compiled and an analysis of the trends in the level of agreeability was performed. The results of the study confirmed that the advancement of the LEED building system in the local construction industry has some major hurdles to overcome before the system is widely accepted.
General Note: In the series University of Florida Digital Collections.
General Note: Includes vita.
Bibliography: Includes bibliographical references.
Source of Description: Description based on online resource; title from PDF title page.
Source of Description: This bibliographic record is available under the Creative Commons CC0 public domain dedication. The University of Florida Libraries, as creator of this bibliographic record, has waived all rights to it worldwide under copyright law, including all related and neighboring rights, to the extent allowed by law.
Statement of Responsibility: by Mathew Forenza.
Thesis: Thesis (M.S.B.C.)--University of Florida, 2009.
Local: Adviser: Kibert, Charles J.
Local: Co-adviser: Ries, Robert J.

Record Information

Source Institution: UFRGP
Rights Management: Applicable rights reserved.
Classification: lcc - LD1780 2009
System ID: UFE0024207:00001

Permanent Link: http://ufdc.ufl.edu/UFE0024207/00001

Material Information

Title: An Analysis of the Local Construction Industry's Perception of the Costs of Leadership in Energy and Environmental Design (LEED) Construction
Physical Description: 1 online resource (111 p.)
Language: english
Creator: Forenza, Mathew
Publisher: University of Florida
Place of Publication: Gainesville, Fla.
Publication Date: 2009

Subjects

Subjects / Keywords: construction, contractor, cost, local, survey, sustainable
Building Construction -- Dissertations, Academic -- UF
Genre: Building Construction thesis, M.S.B.C.
bibliography   ( marcgt )
theses   ( marcgt )
government publication (state, provincial, terriorial, dependent)   ( marcgt )
born-digital   ( sobekcm )
Electronic Thesis or Dissertation

Notes

Abstract: ABSTRACT OF THESIS PRESENTED TO THE GRADUATE SCHOOL OF THE UNIVERSITY OF FLORIDA IN PARTIAL FULFILLMENT OF THE REQUIREMENTS FOR THE DEGREE OF MASTER OF SCIENCE IN BUILDING CONSTRUCTION AN ANALYSIS OF THE LOCAL CONSTRUCTION INDUSTRY?S PERCEPTION OF THE COSTS OF LEADERSHIP IN ENERGYAND ENVIRONMENTAL DESIGN (LEED) CONSTRUCTION By Mathew R. Forenza May 2009 Chair: Charles Kibert Cochair: Robert Ries Committee Member: James Sullivan Major: Building Construction The development of the sustainable building movement in the United States has gone through many different phases over the past four decades. The energy crisis of the 1970s led to legislation by the federal government in order to reduce the US demand of foreign sources of primary energy, such as oil. The legislation established standards for building energy efficiency use and led to the design of buildings which were sealed off from the exterior environment. As a result of the design, the energy use of a building dramatically reduced. However, the level of occupant comfort within the building reduced as well. Through the 1980s and early 1990s, many studies were performed in order to determine how to improve occupant health inside the building. The studies determined that an occupant?s level of health is determined by many different characteristics of the building, such as the amount of natural ventilation or the amount of daylight in a building. The establishment of the United States Green Building Council (USGBC) in 1993 brought the idea of sustainable buildings to the attention of members of the US Government and the academic community. The USGBC then developed a sustainable building scoring system known as the Leadership in Energy and Environmental Design (LEED). The initial LEED rating system was put to market in 1998. Presently, the LEED rating system is comprised of 11 different scoring systems that are categorized into building program types and functions. The general perception among the construction industry nationwide is that there is an additional cost to construct a LEED rated building when compared to a conventional building program. The reviews of some of the more widely accepted studies on the costs of LEED construction were included in the research as well. The majority of the studies however, neglect to mention the perspectives of the construction companies. Therefore, this study sought to determine the opinions of a major stakeholder of the construction industry. This thesis analyzed the local construction industry?s perceptions of the first costs that may be associated with the construction of a LEED building. The local construction industry includes companies throughout North Florida, and the majority of respondents were from Gainesville, FL. The study was conducted with a survey that was distributed through the local builder association?s commercial builder?s council members. The responses were compiled and an analysis of the trends in the level of agreeability was performed. The results of the study confirmed that the advancement of the LEED building system in the local construction industry has some major hurdles to overcome before the system is widely accepted.
General Note: In the series University of Florida Digital Collections.
General Note: Includes vita.
Bibliography: Includes bibliographical references.
Source of Description: Description based on online resource; title from PDF title page.
Source of Description: This bibliographic record is available under the Creative Commons CC0 public domain dedication. The University of Florida Libraries, as creator of this bibliographic record, has waived all rights to it worldwide under copyright law, including all related and neighboring rights, to the extent allowed by law.
Statement of Responsibility: by Mathew Forenza.
Thesis: Thesis (M.S.B.C.)--University of Florida, 2009.
Local: Adviser: Kibert, Charles J.
Local: Co-adviser: Ries, Robert J.

Record Information

Source Institution: UFRGP
Rights Management: Applicable rights reserved.
Classification: lcc - LD1780 2009
System ID: UFE0024207:00001


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1 AN ANALYSIS OF THE LOCAL CONSTRUCTION INDUSTRYS PERCEPTION OF THE COSTS OF LEADERSHIP IN ENERGYAND ENVIRONMENTAL DESIGN (LEED) CONSTRUCTION By MATHEW R. FORENZA A THESIS PRESENTED TO THE GRADUATE SCHOOL OF THE UNIVERSITY OF FLORIDA IN PARTIAL FULFILLMENT OF THE REQUIR EMENTS FOR THE DEGREE OF MASTER OF SCIENCE IN BUILDING CONSTRUCTION UNIVERSITY OF FLORIDA 2009

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2 2009 Mathew R. Forenza

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3 To my family and those who strive to advance the sustainability of our built environment

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4 ACKNOWLEDGMENTS I would like to thank all of my committee members Dr. Charles Kibert, Dr. Robert Ries, and Dr. James Sullivan. All committee members have had great influence on decisions made throu ghout my development in the undergraduate School of Building Construction. These members have been instrumental in my success through the graduate program as well as writing this thesis. I would also like to thank my parents for their unwavering support of my academic career. They have provided both financial and emotional support to achieve all of my educational aspirations. I admire their devotion to my aspirations and will continue to make them proud of my accomplishments.

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5 TABLE OF CONTENTS pag e ACKNOWLEDGMENTS .................................................................................................................... 4 LIST OF TABLES ................................................................................................................................ 8 LIST OF FIGURES .............................................................................................................................. 9 ABSTRACT ........................................................................................................................................ 12 CHAPTER 1 INTRODUCTION ....................................................................................................................... 14 Overview of Sustainable Design & Construction in the U.S. (1970 to present) ..................... 14 Problem Statement & Research Objectives ............................................................................... 17 Limitations ................................................................................................................................... 18 2 METHODOLOGY ...................................................................................................................... 20 3 LITERATURE REVIEW ........................................................................................................... 22 Cost Percept ions of Sustainable Construction........................................................................... 22 General Services Administration LEED Cost Study: Final Report ............................. 25 The Cost and Financial Benefits of Green Buildings ........................................................ 33 Managing the Cost of Green Buildings .............................................................................. 36 Cost of Green Revisited ...................................................................................................... 43 Construction Industry Perceptions of Green Building .............................................................. 47 Green Building Market Barometer for 2008 ...................................................................... 47 Green Buildings and the Bottom Line ................................................................................ 49 4 RESULTS .................................................................................................................................... 60 Response Analysis ...................................................................................................................... 61 Personal Information ........................................................................................................... 61 Participant profession ................................................................................................... 61 Participant position ....................................................................................................... 61 Company location ........................................................................................................ 61 Company Profile .................................................................................................................. 61 Years in business .......................................................................................................... 61 Professional s ervice provided ...................................................................................... 62 Sales revenue in 2008 .................................................................................................. 62 Percent of annual volume LEED ................................................................................. 62 Percent of annual volume green not LEED ............................................................ 62

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6 Number of salaried employees .................................................................................... 63 Number of LEED APs in company ............................................................................. 63 Title of LEED APs in company .................................................................................. 63 LEED Cost Perceptions ....................................................................................................... 63 Budget and schedule for LEED vs. conventional projects ........................................ 64 First cost as a barrier to sustainable design ................................................................ 64 Individual promotion of LEED ................................................................................... 64 Premium cost for LEED vs. conventional .................................................................. 65 LEED premium is included in general conditions ..................................................... 65 LEED required materials have a premium cost .......................................................... 66 Documentation for LEED vs. conventional ............................................................... 66 Profit of LEED vs. conventional ................................................................................. 66 LEED requirements add scope .................................................................................... 67 LEED will become standard in company ................................................................... 67 LEED project size & complexity affects premium .................................................... 67 Documenting LEED requires extra time .................................................................... 68 Financial risk of LEED vs. conventional .................................................................... 68 LEED risk vs. premium ............................................................................................... 68 Descriptive Analysis ................................................................................................................... 69 Descriptive Analysis of Company Size and Cost Perceptions .......................................... 69 First cost as a barrier to sustainable design ................................................................ 70 Premium cost for LEED vs. conventional .................................................................. 70 LEED premium is included in the general conditions ............................................... 70 LEED will become standard in company ................................................................... 71 LEED risk vs. premium ............................................................................................... 71 Descriptive Analysis of Company Annual Revenue and Cost Perceptions ..................... 71 First cost as a barrier to sustainable design ................................................................ 71 Premium cost for LEED vs. conventional .................................................................. 72 LEED premium is included in the general conditions ............................................... 72 LEED will become standard in company ................................................................... 72 LEED risk vs. premium ............................................................................................... 73 Descriptive Analysis of Company LEED or Green Experience and Cost Perceptions ....................................................................................................................... 73 First cost as a barrier to sustainable design ................................................................ 73 Premium cost for LEED vs. conventional .................................................................. 73 LEED premium is included in the general conditions ............................................... 7 4 LEED will become standard in company ................................................................... 74 LEED risk vs. premium ............................................................................................... 74 5 CONCLUSION ........................................................................................................................... 96 Summary ...................................................................................................................................... 96 Recommendations for Future Study .......................................................................................... 99

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7 APPENDIX A LETTER OF CONSENT .......................................................................................................... 101 B SURVEY ................................................................................................................................... 102 C CREDIT FIRST COST SU MMARY ...................................................................................... 104 LIST OF REFERENCES ................................................................................................................. 109 BIOGRAPHICAL SKETCH ........................................................................................................... 111

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8 LIST OF TABLES Table page 3 1 New courthouse construction cost impacts .......................................................................... 54 3 2 Office building modernization cost impacts ......................................................................... 54 3 3 Office building modernization soft cost impacts ................................................................. 54 3 4 New courthouse soft cost impacts ......................................................................................... 55

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9 LIST OF FIGURES Figure page 3 1 Academic buildings distribution of cost ($/GSF) ............................................................... 55 3 2 Laboratory building s distribution of cost ($/GSF) ............................................................. 56 3 3 Library building s distribution of cost ($/GSF) ................................................................... 56 3 4 Community centers distribution of cost ($/GSF) ................................................................ 57 3 5 Ambulatory cares distribution of cost ($/GSF) ................................................................... 57 3 6 Type of company & facilities respondents manages ........................................................... 58 3 7 Executives response to the discouraging factors ................................................................ 58 3 8 Owner and developer perceptions of the barriers to green development ...................... 59 4 1 Profession of the participant (N=11) ..................................................................................... 76 4 2 Job title of the participant (N=11) ......................................................................................... 76 4 3 City company is located (N=11) ........................................................................................... 77 4 4 Years companies surveyed have been in business (N=11) .................................................. 77 4 5 Services provided to client by company (N=11) .................................................................. 78 4 6 Annual construction revenue (N=11) .................................................................................... 78 4 7 Company annual revenue that has achieved LEED certifications (N=11) ......................... 79 4 8 Percent of construction revenue which is gree n not LEED (N=11) ................................ 79 4 9 Quantity of salaried professionals in company (N=11) ....................................................... 80 4 10 Quantity of LEED APs in company (N=11) ........................................................................ 80 4 11 Title of LEED AP within company structure (N=11) .......................................................... 81 4 12 Budget and schedules of LEED projects and conventional pr ojects are equal (N=11) ..... 81 4 13 First cost as a barrier to sustainable design (N=11) ............................................................. 82 4 14 Individual promotes LEED rating system to prospective clients (N=11) ........................... 82 4 15 Premium associated with LEED building as opposed to conventional (N=11) ................. 83

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10 4 16 L EED premium is added to the General Conditions of the budget (N=11) ....................... 83 4 17 LEED required materials have an additional cost (N=11) ................................................... 84 4 18 LEED documentation is greater than non LEED documentation (N=11) .......................... 84 4 19 LEED projects profit more than non -LEED buildings (N=11) ........................................... 85 4 20 LEED requirements add scope above non -LEED project scopes (N=11) .......................... 85 4 21 LEED to become standard practice of company (N=11) ..................................................... 86 4 22 The correlation between LEED project size and any resulting LEED premium (N=11) ..................................................................................................................................... 86 4 23 LEED documentation requires additional time for project team (N=11) ........................... 87 4 24 LEED projects have a greater financial risk than non -LEED projects (N=11) .................. 87 4 25 Project risk due to LEED requirement will increase LEED premium (N=11) .................. 88 4 26 Average response based on companys salaried personnel in relation to first cost as a barrier to sustainable design .................................................................................................. 88 4 27 Average response based on companys salaried personnel in relation to the firm charging a premium for LEED vs. conventional projects ................................................... 89 4 28 Average response based on companys salaried personnel in relation to the LEED premium in the general conditions ........................................................................................ 89 4 29 Average response based on companys salaried personnel in relation to LEED becoming standard practice ................................................................................................... 90 4 30 Average response based on companys salaried personnel in relation to LEED risk vs. cost increase ...................................................................................................................... 90 4 31 Average response based on company annual revenue in relation to first cost as a b arrier to sustainable design .................................................................................................. 91 4 32 Average response based on company annual revenue in relation to a premium charged for a LEED vs conventional project ...................................................................... 91 4 33 Average response based on company annual revenue in relation to LEED premium in the general conditions of the budget ................................................................................. 92 4 34 Average response based on company annual revenue in relation to the eventual standard practice of LEED in the company .......................................................................... 92

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11 4 35 Average response based on company annual revenue in relation to the LEED risk vs. premium charged .................................................................................................................... 93 4 36 Average response by LEED & green construction percent of annual volume in relation to the first cost still as being a barrier to sustaina ble design .................................. 93 4 37 Average response by LEED & green construction percent of annual volume in relation to a premium charged for a LEE D vs. conventional project ................................. 94 4 38 Average response by LEED & green construction as percent of annual volume in relation to the premium of LEED accounted for in the general conditions of the budget ...................................................................................................................................... 94 4 39 Average response by LEED & green construction as perc ent of annual volume in relation to the LEED system becoming standard practice ................................................... 95 4 40 Average response by LEED & green construction as percent of annual volume in relation to LEED risk and the increase of the premium charged ........................................ 95

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12 Abstract of Thesis Presented to the Graduate School of the University of Florida in Partial Fulfillment of the Requirements for the Degree of Master of Science in Building Construction AN ANALYSIS OF THE LOCAL CONSTRUCTION INDUSTRYS PERCEPTION OF THE COSTS OF LEADERSHIP IN ENERGYAND ENVIRONMENTAL DESIGN (LEED) CONSTRUCTION By Mathew R. Forenza August 2009 Chair: Charles Kibert Co -chair: Robert Ries Major: Building Construction The development of the sustainable building movement in the United States has gone through many different phases over the past four d ecades. The energy crisis of the 1970s led to legislation by the federal government in order to reduce the US demand of foreign sources of primary energy, such as oil. The legislation established standards for building energy efficiency and led to the de sign of buildings that were sealed off from the exterior environment. As a result, the energy use of a building dramatically reduced. However, the level of occupant comfort within the building was reduced as well. Through the 1980s and early 1990s, many studies were performed in order to determine how to improve occupant health inside buildings. The studies determined that an occupants level of health is determined by many different characteristics of the building, such as the amount of natural ventila tion or the amount of daylight in a building. Beginning in 1993, the United States Green Building Council (USGBC) brought attention to the idea of sustainable buildings. The USGBC then developed a sustainable building scoring system known as the Leaders hip in Energy and Environmental Design (LEED). The initial

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13 LEED rating system was tested in 1998. Presently, the LEED rating system is comprised of 11 different scoring systems that are categorized into building program types and functions. The general perception among the construction industry nationwide is that there is an additional cost to construct a LEED rated building when compared to a conventional building. The reviews of some of the more widely accepted studies on the costs of LEED constructi on were included in the research. The majority of the studies however, neglect to mention the perspectives of construction companies. Therefore, this study sought to determine the opinions of a major stakeholder in the construction industry. This thesis analyzed the local construction industrys perceptions of the first costs that may be associated with the construction of a LEED building. The local construction industry includes companies throughout North Florida, and the majority of respondents were fr om Gainesville, FL. The study was conducted with a survey that was distributed through the local builder associations commercial builders council members. The responses were compiled and an analysis of the trends in the level of agreement was performed The results of the study confirmed that the advancement of the LEED building system in the local construction industry has some major hurdles to overcome before the system is widely accepted.

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14 CHAPTER 1 INTRODUCTION Overview of Sustainable Design & Construction in the U.S. (1970 to present) According to a presentation given by the American Society of Heating, Refrigeration, and Air Conditioning Engineers (ASHRAE) President Kent Peterson, global green house gas emissions have increased by 70% between 1970 and 2004 (Peterson). The sustainable or efficient building movement from 1970 to present has evolved dramatically over the past forty years. The National Environmental Policy Act (NEPA) of 1969, with a final amendment in 1982 was established to: Declare a national policy which will encourage productive and enjoyable harmony between man and his environment; to promote efforts whic h will prevent or eliminate damage to the environment and biosphere and stimulate health and welfare of man; to enrich the understanding of the ecological systems and natural resources important to the Nation; and to establish a Council on Environmental Quality. This act was the first major shift in the development and protection of our environment. Following the NEPA, a host of other environmental protection acts such as the Clean Air Act, the creation of the Council on Environmental Quality, and other hi ghly prescriptive and detailed legislation was enacted by the United States Government (Alm 1988). The built environment of the 1970s was dramatically changed due to the energy crisis of the early 1970s. As a reaction to the high price and demand of ene rgy for use in buildings, the first energy conservation standard was developed for buildings by ASHRAE, upon the request of the Federal Government. This standard, ASHRAE 90.1, was developed in order to increase the energy efficiency of buildings througho ut the US. The standard is now used as a national reference for state commercial building energy codes, ASHRAE 90.1 1999 (Peterson). The design of commercial buildings throughout the 1970s and 1980s incorporated a bigbox philosophy which dramatically increased the overall efficiency of the building. The big-box

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15 basis of design for buildings used limited numbers of openings, such as windows, in order to increase the thermal efficiency of the building. This style of design reduced the overall energy demand of the building, thereby reducing the demand for foreign sources of energy. According to an interview from Alex Wilson, the energy crisis of the early 1970s started the idea of reducing the production of energy for buildings from fossil fuels. Thi s movement started with research into solar power systems for buildings. The solar power system of the building would, theoretically, allow the building to use the energy it produces on site, thus reducing the buildings use energy generated from fossil fu el (Wilson 2009). The solar power movement began to stall because of the reduction in the price of energy. The solar power systems were not financially feasible due to the lowered cost of fossil fuel powered electricity. The energy crisis of the 1970s a lso began a movement toward super insulated buildings (Wilson 2009). The dramatic increase in the cost of energy led to design teams increasing the efficiency of buildings by increasing the tightness and efficiency of the building envelope. The super ins ulated building was able to dramatically reduce the amount of energy the building consumed. Though the energy consumption was dramatically reduced, the buildings were isolated to all outside conditions, such as temperature, humidity, and fresh air. Even though the energy efficiency goals were met, the big box style of building design had some unintended consequences for the building occupants. Throughout the 1980s the big box building design was thoroughly researched to determine what kind of effect, if any, the design had on the buildings occupants. Many studies in the 1980s and early 1990s referred to sick building syndrome. Sick building syndrome, as defined by the Environmental Protection Agency (EPA), is used to describe situations in which building users experience acute health and comfort effects that appear to be linked to time spent in a building, but no specific illness or

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16 cause can be identified (EPA 1991). The design of HVAC systems based on the newly adopted ASHRAE standards reduced ventilation rates from 15 CFM to 5 CFM per occupant (EPA 1991). This is noted as a major contributor to sick building syndrome. The realization of the causes of sick building syndrome resulted in a shift in the construction and design of commercial and residential buildings beginning in the 1990s. The sustainable development movement has built up a great deal of momentum since the first major summit in 1992, The Rio Conference. The conference was organized through the United Nations and produced the document known today as Agenda 21. One hundred seventyeight governments at the Rio Conference on June 14, 1992, adopted Agenda 21, or the Rio Declaration on Environment and Development and the Statement of principles for the Sustainable Management of Fore sts The late 1990s saw another dramatic shift towards a healthier built environment in order to combat sick buildings. According to Alex Wilson, the idea of a building contributing to the health and welfare of the occupant was used as a catalyst to shi ft the design of the buildings to account for the occupants well -being. This style of design would reduce the amount of hazardous chemicals in buildings, such as volatile organic compounds (VOCs), which are prevalent in adhesives and paints. In Johannesburg, South Africa, Agenda 21 was strongly reaffirmed at the World Summit on Sustainable Development in 2002. These declarations agreed upon by the many nations from around the world have the goal of transforming the market into a sustainable, environmentally friendly market. According to The Bruntland Report, sustainability is meeting the needs of the present without compromising the ability of future generations to meet their needs. (et al. 1987). Although the ideas of these declarations a re met with open arms throughout the USA, a major hurdle to the advancement of sustainable development still exists.

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17 Throughout the evolution of the sustainable building movement, there have been many questions and opinions relating to the success of the m ovement. The notion that a LEED building has an additional premium associated with the LEED requirements is one of the topics many professionals and academics discuss. The construction industry in the greater Gainesville area may be exposed to a greater volume of LEED buildings than most other regions around Florida. The University of Florida has enabled the contractors in the region to become familiar with the requirements of the LEED systems through a building standard which requires a LEED Gold ratin g. Along with the University of Florida, Alachua County has explicit LEED requirements for all county government buildings through the application of building ordinances. The adoption of the LEED system by the local government and the institutions around Gainesville has exposed the construction industry in the region to the LEED system. This region of the United States has the unique distinction of being a leader in the development of sustainable construction methods and standards. Problem Statement & Research Objectives The perception that building a LEED building has a cost premium over a conventional building has been a subject that has been researched since the advent of the LEED building rating system. The green building movement has moved to the forefront of the building construction community. This could be attributed to outside factors such as the price of energy and the environmental impact of the built environment. The research community has done many different studies with respect to first cost premiums associated with LEED buildings, but most of the studies are focused on additional design costs for specialized systems such as a building automation system. The studies however, do not quantify a first cost increase to the construction cont racting companies of the LEED project. A literature review has been conducted for this

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18 research study and the research communitys view has been consistent with the assumption that the construction manager will experience a cost increase to deliver a LEED building. Even though many of the studies mention a first cost increase, that cost increase is not quantified. The objectives of this research study are to: Determine the local construction industrys perspective of a LEED building and if they realize a cost premium for the building requirements. Determine if the local contractors annual revenue has an effect on the cost premium that they would or would not charge to an owner. Determine if there is a relationship between the size of a local contractor a nd the additional cost premium charged by that contractor. Determine if the LEED experience of a local contractor has an effect on the cost the company would or would not charge for LEED services. This research was conducted in order to determine the loca l construction industrys perception of the green building movement as it relates to the first costs of a building. Through the distribution of a questionnaire to the local builders association, the industrys perception could be gauged. After the collec tion of the survey is completed, suggestions will be made to the builder associations throughout the state of Florida. The green building movement will succeed through the education of all of its stakeholders. This study aims at determining an overall pe rception of the green building movement within the building community of North Florida. Once the overall perception of the contractors is determined the implementation of educational programs to enhance the green building movement can begin. Limitations The resulting analysis of this study are open to individual interpretation due to the fact that a majority of the data presented in this study is based on the opinions of a small portion of the local construction industry. Although this study was perform ed with care and respect to the

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19 scientific process, there were some significant limitations that must be mentioned before the results of the survey are presented. The first limitation which hinders the study from determining is the limited number of survey responses. The majority of the surveys were distributed through the local builders association. This method of distribution automatically limited the quantity o f responses. Therefore, the data was unable to be analyzed on a statistical level. A review of the Builder Association of North Central Floridas membership directory revealed that there are 51 commercial general contractors or construction managers in t he region. Another limitation to this study is that the results of the survey were based on the local construction industrys perspectives that immediately reduced the sample population. A more extensive sample of companies from the Southeast United Sta tes, for example, may produce drastically different results. This study did not take into account any company outside of the regions adjacent to Gainesville, FL and Alachua County. The third limitation to the study was the subject matter presented to th e participants. The respondents experience with LEED or lack thereof makes a few of the survey question difficult to analyze. In review, the introduction provided a brief history of the movement towards sustainable design and construction in the United States from the 1970s to the present day. The problem statement and scope of the research was then presented in order to familiarize the reader with the goals of this research. Finally, the limitations to the study were discussed, which allow the future research student to expand upon the ideas presented in this study. The next chapter will discuss the methodology of the research conducted on the local construction industry and the development of the ideas behind the survey.

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20 CHAPTER 2 METHODOLOGY Since the first version of the USGBCs sustainable rating system, LEED -New Construction version 1.0, was created there have been numerous reports which try and quantify the many different benefits stated by the United States Green Building Cou ncil (USGBC). The amount of literature in the area of cost of a LEED building is large. The opinion that a LEED building requires an additional capital outlay from the owner has been well documented in the literature review. The issue regarding cost has many different factors which this report has reviewed in detail. This study was conducted in order to examine the part of the cost equation in which there has been a limited amount of research performed, the view or perspectives of the contractor. The r esearch included, a review of periodicals regarding the sustainable building movement, sustainable construction, and the LEED rating system was conducted. The survey was separated into three separate sections; personal information, company information, a nd perceptions of cost with relation to LEED. The survey consisted of short answer responses which would classify each company by the age, size, annual revenue, number of LEED APs, number of LEED or green projects, specialization of the company, and posit ion of the participant. The second type of question was used to gauge the participants level of agreement with a particular statement based on a seven -point Likert scale. The respondent would select 1 for a strongly disagree response, to selecting a 7 f or a strongly agree response, with 4 as a neutral opinion about the statement. The end of each section of the survey had space for the participant to write in additional comments. The final developed survey consisted of 14 questions relating to the part icipants opinions of the statements about LEED and green building project programs. There were also 11 questions regarding the participant and the company where they are employed. In addition to the

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21 survey, a letter of consent was developed as required by the University of Floridas Institutional Research Board (IRB). After receiving the IRB approval (see Appendix A), the survey and letter of consent were distributed by hand to the members of the Builders Association of North Central Florida. The meetin g was of the Commercial Builders Council at Napolitanos Italian Restaurant on March 25, 2009. The meeting attendees consisted of 51 members of the commercial construction industry. Based on a confidence level of 95% and a confidence interval of 5, the t otal number of survey responses required was calculated to be 46 responses. Attendees included general contractors, subcontractors, material suppliers, and banking institutions. Once all surveys had been returned the responses were compiled into a Micro soft Excel spreadsheet to organize and analyze the results graphically. The responses were then analyzed in order to determine the overall perceptions of the respondents. A second analysis will develop a deterministic summary between company size, revenu e, and years in business and the different perceptions about the first costs of LEED buildings. This chapter discussed the methods in which this study was developed, conducted, and finally analyzed. The following chapter will discuss some of the more we ll -known studies conducted regarding the costs associated with LEED buildings.

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22 CHAPTER 3 LITERATURE REVIEW Cost Perceptions of Sustainable Construction There is a perception in the building industry that going green or building a sustainable bui lding requires an increased capital investment when compared to a building that would not have sustainable goals. According to Peter Morris of Davis Langdon, the cost for incorporating sustainable design elements will depend greatly on a wide range of fa ctors, including building type, project location, local climate, site conditions, and the familiarity of the project team with sustainable design (Morris 2007). When all of these factors are accounted for and quantified the increase in the cost of a sust ainable building is not overwhelmingly high. This perception has begun to slowly fade with the increase in the price of energy and the increase in focus by building product manufacturers to focus on sustainable products, such as Interface carpet systems. According to Peter Morris of Davis Langdon, sustainable materials and systems are becoming more affordable, sustainable design elements are becoming widely accepted in the mainstream of project design, and building owners and tenants are beginning to dem and and value those features (Morris 2007). In order to justify the initial cost increase for a building to the owner there are some main points that should be addressed. An important concept any owner should be informed of is the owners return on investment. The owner would be hard pressed to go into an investment decision without a positive return on investment. The owners return on investment, or ROI, can come in many different forms. The rising cost of energy today and in the future provides so lid evidence of a shorter ROI when a life cycle cost analysis is performed on more efficient building energy using systems. By incorporating passive design, a high performance building envelope, building orientation, high -efficiency HVAC systems, and ligh ting controls, the buildings energy

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23 demand can be greatly reduced. By decreasing energy consumption, the ROI of the systems will increase. Another strategy is to reduce the amount of potable water used and sent to wastewater treatment plants. Some strat egies, which can be incorporated into the building to reduce demand and waste of potable water, are waterless urinals, constructed wetlands and rainwater harvesting. With the energy and water saving strategies mentioned above, the owner can realize a redu ced cost and a more positive ROI. Another economic argument for a sustainable building is that the owner and tenants will have a better indoor environment, which will lead to better occupant health and productivity. There is a concept coined by Harvard biologist Edward O. Wilson, PhD in which he thought human beings have an innate and evolutionarily based affinity for nature. He defined the term biophilia as the connections that human beings subconsciously seek with the rest of life (Wilson 2006). Thi s concept of biophilia can make a strong argument for the initial increase in capital when designing and building a sustainable building. Incorporating the biophilic concept into sustainable building design has two main reasons to justify the additional c ost, according to Alex Wilson. First, the design of these buildings has begun to show tangible benefits to occupant health. For example, in a landmark study, published in 1984, Roger Ulrich showed that patients recovering from gallbladder surgery recove red more quickly and required less pain medication if they had a view of trees outside their windows than if they looked out on a brick wall (Wilson 2006). The incorporation of these design principles in hospitals could possibly reduce the average hospit al stay for the patient, which would drastically reduce the operating costs of the hospital. A perception that worker productivity improves when they are inside a building that focuses on individual comfort that is associated with sustainable design is a very controversial

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24 topic. As shown many decades ago by the Hawthorne Experiments, the setting and changing of the environment has no real effect on the productivity of the workforce. Measuring worker productivity in an office setting is quite difficult. Researchers from the Rocky Mountain Institute and Carnegie Mellon University have reported significant improvements in productivity as a result of green building features, including daylighting and views to the outdoors. (Wilson 2006). As an owner, if t he productivity of your workforce increases you would expect to make a greater profit and perform more work in the same amount of time as before the upgrade to a sustainable building. A common study referenced is a report on sustainable building costs a nd its relevant effects on occupant productivity is the California Sustainability Task Forces report of cost benefit analysis of green building. From the study, the task force concluded green buildings have an average of 0 to 2% increase in first cost o ver their conventional counterparts, but that they recoup 20% of construction costs over 20 years (Kats 2003). Much of the perceived financial benefit is realized through the productivity and health of the occupants. An important factor an owner must consider when developing sustainable goals for their building is the notion of corporate social responsibility. Corporate social responsibility is defined as a concept whereby organizations consider the interests of society by taking responsibility for t he impact of their activities on customers, suppliers, employees, shareholders, communities and other stakeholders, as well as the environment (JB 2003). A business that pursues this ethical structure in all decisions will become a leader in their market As a leader in their market Interface Carpet Systems has forged the direction for all major corporations who would like to be as sustainable as they can be. Interface has become the world leader in carpet systems and they are using their place in the m arket as a driving force behind all material

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25 manufacturers to become more sustainable. According to an EBN article, by improving energy efficiency and using green power, Interface has reduced its greenhouse gas emissions by nearly one third since 1996 ( JB 2003). If you offset energy demands from non-renewable to renewable resources and decrease demand, the owner of the company will have a much better public image and will reduce annual expenses at the same time. From the owners perspective the cost of sustainability can be returned through the reduction of energy use and water consumption. The return can also come in the form of a better public image and increased productivity from their workforce. While the owners of the buildings will undoubtedly decide the direction of the sustainable building movement the contractors are responsible for building and implementing the owners program. According to a report from Construction Management & Economics the lack of respect for sustainability within the construction industry would also appear to be a problem across Europe (Myers 2005). In order to state the case for the incremental increase in cost for a sustainable building, the construction industry needs to determine if there is a cost premium for the construction phase of sustainable buildings. Until this issue is solved there will be an uncertainty of costing which will lead to an increase in the price of the building. The following literature review will focus on some of the research conducted wi th regard to the cost perceptions and issues that are related to the sustainable construction movement in the United States. General Services Administration LEED Cost Study: Final Report The U.S. General Services Administration (GSA) is the largest property owner in the World. According to the GSA website, www.gsa.gov the administration leases and owns 354 million square feet of space in 8,600 buildings i n the United States. The properties the GSA hold range from office buildings to land ports of entry. In 2003 the first mandate from the GSA to have all new buildings LEED Certified was enacted. With this mandate in place, the GSA along

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26 with Steven Winte r Associates began a study to determine the costs that a LEED building would incur in relation to a conventional GSA building. From that study The GSA LEED Cost Study: Final Report was finalized in October 2004. The costs of the new facilities were to be based on the most recent version of the USGBCs LEED building rating system, New Construction v2.1. The report determined a detailed view of hard and soft construction costs for twelve different LEED scenarios. The study analyzed two different building types that make up a significant percentage of the GSAs planned capital projects over the next five t o ten years. The two building types analyzed were a courthouse and an office building renovation. In order to relate the costs the project location is set in Washington, D.C. Additionally, the construction cost data used to determine cost differences is based on November 2003 cost data. The study determined a baseline construction cost estimate for each of the two building types involved in the study. The baseline estimates incorporated the GSAs Facilities Standards for the Public Building Service (d ocument PBS -P1000, 2003) and the US Courts Design Guide. The design guides requirements and baseline construction estimates were then compared to the LEED prerequisites and credits to determine if there were synergies between the design guides and the cr edits to be achieved. All of the synergistic credits were not included in this study. The synergistic credits would not have any cost premium due to those credits already being a requirement for the standard GSA building. All other credits analyzed, whi ch did not have a synergistic match with any of the design guides, had an additional cost impact estimate. This additional cost estimate determined the costs of the specific credit above the standard design guides. The individual credit costs were catego rized using the following criteria: 1) GSA Mandate (no cost), 2) No Cost/Potential Cost Decrease, 3) Low Cost (<$50K), 4) Moderate Cost

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27 ($50K $150K), 5) High Cost (> $150K). After the individual credit cost assessment was performed the overall project c ost estimates were performed on twelve different LEED rating scenarios. The courthouse was subjected to two different cost models for each rating level desired. Low cost and high cost estimates were developed for Certified, Silver and Gold ratings. Tabl e 3 1 details the construction cost impact as well as the percent change when compared to the baseline construction cost. The construction cost impacts per credit for the new courthouse ranged from a cost decrease of .40% to a cost increase of 8.10% (Tab le 3 1). The two different scenarios for the office building modernization were a minimal faade renovation or full faade renovation. The minimal faade renovation included window replacement along with minor repairs to the exterior of the building. The full faade renovation included a full replacement of the buildings Heating, Ventilation and Cooling (HVAC) system, full building faade redesign, new cladding design, new windows and new insulation. The construction cost impact as well as the percenta ge change when compared to the baseline construction cost was quantified in the report (Table 32). The construction cost impacts associated with the office building modernization are between 1.40% and 8.20% greater than the baseline GSA building estimate (Table 3 2). This additional cost premium is due to the higher cost of more energy efficient HVAC units and the high -performance glazing system. Another aspect of the total program budget discussed in the GSA report was that of soft cost increases for t he project team members. The project team members include the architect, engineer, construction manager, landscape architect, and a sustainability or LEED consultant. The soft costs of the project were defined as any LEED related tasks considered above and beyond standard GSA project requirements. The soft costs were then separated into two

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28 different categories LEED Design Costs and LEED Documentation Costs The LEED Design Costs are related to the tasks that increased the design teams scope of work during the design and construction of the project. The LEED Documentation Costs are related to the tasks that involved the documentation and submission of all required materials to the United States Green Building Council in order to register and certify the project. Following the construction cost estimate impacts, the soft cost impact analyzed the six different scenarios for the two building program types. The soft costs were analyzed with the incorporation of two different integrated design team appr oaches. The first approach analyzed was an Expert Consultant approach. In this approach the design team would hire an outside green consultant to facilitate the LEED certification process. The green consultant would coordinate the LEED submittal pro cess and streamline the documentation and submission process for all parties involved in the construction of the buildings. The second approach analyzed was an Experienced Design/Construction Team approach. This approach utilizes the past LEED experien ce of the design/construction team to handle all required documentation and submission for the LEED rating desired of the building program. The soft cost impacts for the Office Building Modernization are detailed in the report as well (Table 3 3). The so ft cost increase per square foot for the office building ranges from a minimum of 0.35 $/GSF to a maximum of 0.70 $/GSF. The soft cost impacts for the New Courthouse have also been calculated (Table 3 4). The soft cost impact for the new courthouse range s from 0.41 $/GSF to 0.80 $/GSF. The results of the LEED integration to the baseline building types should not be used as a percent increase to determine the cost on a project or owner specific project. The numbers generated are in relation to specific GS A guidelines and building types. Different building types

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29 and building programs may have a dramatic affect on overall building cost and the soft cost increase or decrease to achieve a LEED rating. The cost impacts just detailed are based on a specific s et of qualification data used to estimate the additional cost for the credits that were not initially included in the GSAs standard guidelines for construction. The study references six cost qualifiers that will help relate this study to buildings of dif ferent types, building sizes, and nonGSA buildings. The first cost qualifier mentioned in the study is the difference in building program and differing site conditions for individual projects. All construction projects are unique in their own right. D ifferent building programs would require modification to the achievable credits list and then a re -evaluation of the synergistic credits with local codes and ordinances. The site variability between projects will also determine which credits are achievabl e on a project byproject basis. This variability will also change the credits achievable and the resulting cost implications of the new credits. The second qualifier, GSA -specific design requirements, will lead to variability in the cost of a building program outside of the GSAs design guidelines. The GSA -specific guidelines that are not standard building practice for most owners would add a premium to the cost of the building that this study does not account for. There are seven guidelines for the G SA building program that could cause a substantial cost increase for the nonGSA building. The seven criteria that the GSA building program follows are: 1) Commissioning, 2) Energy efficiency, 3) Underfloor air delivery system, 4) Dedicated ventilation system, 5) Recycled -content materials, 6) HCFC refrigerants, and 7) Green power. All of the above criteria are included in the GSAs design guidelines and achieve one or more credits for the LEED rating.

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30 The third cost qualifier mentioned is the notion that no programmatic trade -offs were made between the LEED and non -LEED buildings cost estimates. Programmatic trade -offs could be a potential cost reducing strategy for owners. Individual owners have the ability to reduce the quality of some aspect of the building that is not affected by the LEED criteria and upgrade some systems that the LEED rating system qualifies as a credit. The fourth cost qualifier that could possibly alter the results of the analysis would be the size of the buildings analyzed. T he study does not include a multiplier to adjust the $/GSF figures detailed in the above results. The soft costs per square foot would dramatically increase in smaller buildings and conversely would decrease in larger projects. According to the report, t he total dollar costs for LEED related services are expected to level out after they cross certain low end and high end thresholds. The fifth factor of the GSA study that may cause variability in the results is the differing variations in baseline building costs. The two different building program types, design standards, and assumptions about the site have different baseline costs per square foot. Differing baseline costs per square foot would directly influence the impacts of LEED credits on the overall construction cost based on a percentage basis. Since the relationship between the baseline cost per square foot and percent impact is based on a percentage, both the base dollars per gross square foot and the percentage impact need to be considered when evaluating different projects using the GSA model for calculating cost impacts. The sixth and final cost qualifier the GSA study mentions is the use of LEED Version 2.1 to determine the credits and the level of impact derived from each credit. The use o f the study to relate to all LEED projects is unwarranted due to the amount of variation and uncertainty between the future versions of the LEED rating systems. Since the study was conducted in late

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31 2004 there have been two different variations of the LEE D for New Construction and Major Renovations. LEED NC Version 2.2 and the soon to be LEED 2009 will take precedent over the LEED Version 2.1 rating system. The GSA study, therefore, should be modified to accommodate for individual credit changes made thr oughout the evolution of the LEED rating systems. Based on the above cost estimate qualifiers the estimation of an individual building extrapolated directly from the studys results could lead to cost impacts which may vary greatly from the true cost imp acts for the individual project. Individual projects that choose to pursue a LEED rating have many different options of achieving certain credit point thresholds. The approach to achieve the highest number of LEED credits for your project at the lowest cost could be called gaming the system. The GSA study analyzes four main LEED cost variables. The first cost variable is the relation between the point value of a credit and the cost of the credit. An example of this scenario would be the cost differe nce between low -VOC paints for a credit compared to installing solar panels for one credit. The second cost variable looks at the ability for one credit to be achieved through many different options. Each one of these options could have a reduced cost to the project or an increase in cost to the project. An example from the study analyzes Sustainable Sites credit 6.1 Stormwater Management (Rate & Quantity). In one of the low -cost scenarios of the Courthouse model, increasing the plantings on site and reducing the amount of hardscape reduced the quantity and rate of stormwater. This strategy actually reduced the cost of the project. On the other hand, the high cost scenario integrated a vegetated roof system to mitigate the amount of stormwater runoff. The additional cost of the vegetated roof was $580,000.00. The third cost variable mentioned in the study was that the cost of some credits varies widely for the different

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32 building programs and types. An example detailed in the GSA study relates the d ifference in costs between achieving Materials & Resources credit 7.1 Certified Wood. In order to achieve the credit in the Office Building model the additional cost was relatively low, approximately $77,000. On the other hand, the cost to achieve the same credit for the Courthouse model would cost an additional $600,000. The fourth and final cost variable is that some credit costs vary by region -specific or project -specific variables. An example of this would be the ability of a project in Miami, FL to achieve points for Material & Resources credits 5.1/5.1. It is quite difficult for Miami to acquire materials in the 500 mile radius specified due to the fact that most of that 500 mile radius is comprised of the Gulf of Mexico, Atlantic Ocean, and Car ibbean Sea. Looking past the above -mentioned cost qualifiers and variations for the specific project type and location; it can be reasonably assumed that the costs to achieve a LEED rating for a GSA building can be managed, possibly predicted. The GSA det ails a structured approach to achieving the LEED rating with minimal cost impacts to the project. The first step is to include all LEED credits that would be included in the building program based on GSAs design guidelines. The second step mentioned is to include the LEED credits that have no cost or minimal cost based on the specific project. Third, the project team must include the credits that have little effect on project design but contribute to the LEED point system. An example of this strategy w ould be to incorporate low -VOC paints, adhesives, and sealants. The final stage of credit selection would be to evaluate the moderate and high cost credit options. An analysis of the credits and their corresponding strategies should be performed to calcu late first cost and also the benefit and future cost savings of the systems. Included in this analysis should be a review of the different synergies of one system to achieve different credit points.

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33 The Cost and Financial Benefits of Green Buildings In October 2003 Greg Katz, of Capital E, provided a comprehensive LEED cost report to the California Sustainable Building Task Force (CSBTF). The CSBTF is a group of over forty State government agencies. These agencies are comprised of building, environment al, and fiscal experts who have developed great results for the integration of the sustainable building movement for Californias public building system. Preceding this study, in 2000 and 2001, Governor Gray Davis issued two Executive Orders that address ed sustainability features such as siting and construction of State owned facilities. The first, Executive Order D 16 00, was enacted to establish the Governors goal for the state building program. The second, Executive Order D 46 01, was enacted to provide a framework for the leasing and locating state buildings. The two Executive Orders are referenced from the study: Executive Order D 1600 establishes the Governors sustainable building goal to site, design, deconstruct, construct, renovate, operate and maintain state buildings that are models of energy, water, and materials efficiency; while providing healthy, productive, and comfortable indoor environments and longterm benefits to CaliforniansThe objectives are to implement the sustainable buildin g goal in a cost effective manner; use extended life cycle costing; and adopt an integrated systems approach Executive Order D 4601 provides guidance on the process of the Department of general Services will use to locate and lease space, including such considerations as proximity to public transit and affordable housing, preserving structures of historic, cultural, and architectural significance, opportunities for economic renewal; and sensitivity to neighborhood and community concerns. The two executiv e orders were designed to make the Californians tax dollars return a greater investment for the state buildings. The orders would solidify Californias ability to transform the building and construction market towards sustainable growth. After the sign ing of the Executive Orders the CSBTF was formally convened to analyze the feasibility of the two orders and what type of coordination would be required to meet the

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34 demands of the Executive Orders. The meetings regarding the implementation of the new requ irements had a lingering question regarding the costs that would be required to meet the new sustainability demands of all state owned buildings. After recognizing the importance that cost had in the decision making process of building programs, the CSBTF funded an Economic Analysis Project (EAP). This select group of individuals set out to determine the direct costs and benefits of a sustainable building program. The EAP reviewed many past studies and determined that, in general, sustainable building pro grams would incur a green premium. The study also determined that the financial and environmental benefits of a sustainable building program, such as energy savings, had to be analyzed with a life cycle cost and savings analysis. According to the EAP, from a life cycle savings standpoint, savings resulting from investmentdramatically exceed and additional upfront costs. There are a multitude of issues that sustainable buildings can address. Some of the strategies to combat the high cost of electric power, water shortages, global warming potential, increasing operations & maintenance costs, and the health of the workspace may initially cost more. This is the reason a life cycle cost analysis must be performed on the many different strategies the EAP recommends. The report by Katz sought to incorporate all of the existing studies of the costs and benefits of a sustainable building program in California. The study performed an analysis of 33 different green buildings and compared them to a conventional building of the same program requirements and use. The different financial benefits the Katz study analyzes are energy, emissions, water, waste costs, commissioning O&M, and productivity and health. The financial costs Katz discusses in the initial g reen cost premium. This portion of the literature review will focus on the initial cost premium of the Katz findings.

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35 The initial cost of a green building is analyzed in Chapter 3 of the Katz report. The cost analysis was performed on 33 individual LEED registered project throughout California. Of the 33 projects, 25 were office buildings and 8 were school buildings. The buildings were selected for the analysis because they had cost data for both green and conventional design criteria. The buildings c ost estimates analyzed were collected through interviews with architects and other senior building personnel; written and verbal communication with the CSBTF members, USGBC staff, attendees at the Austin green building conference; through a query posted i n the Environmental Building News; and from others. The projects analyzed ranged from an average cost premium for LEED Certified of 0.66% to LEED Platinum average cost of 6.50%. This data looks quite promising for the outlook of green building. The dat a, however, is not sufficient in its inclusion of multiple buildings per LEED rating achievement level. The referenced project list includes 33 different projects and their corresponding green cost premium. The averages for each rating level are diffic ult to compare between based on the number of different projects per LEED rating. The LEED Platinum average is only based on a single project. In order for the green cost premium to be justified as an average a much larger sample must be looked at. Th e average that may represent the true green cost premium would be the projects analyzed with a LEED Silver rating. The LEED Silver projects totaled 18 different buildings. This sample size is a better gauge of the true cost premium associated with a LE ED project. Another anomaly in the cost averages is that a LEED Gold buildings average green premium is less than that of the LEED Silver average green premium. This is also due to the insufficient sample size of LEED Gold buildings, which was only six. Once again, a larger sample size of LEED Gold buildings will facilitate a more accurate average green cost premium.

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36 Managing the Cost of Green Buildings The Dutch based Keuring van Elektrotechnische Materialen (KEMA) Group submitted a report to the CSBTF around the same time, October 2003, as the Katz report. The premise of this report is slightly different. The report submitted by the KEMA Group does not have actual cost data regarding the increased capital required for a green building. The KEMA report identifies the best management practices that should be put in place in order for the project cost to be on the bottom of the cost range for the percent cost increases for a green building. The projects analyzed for this report are projects for th e Alameda County Waste Management Authority, the California State and Consumer Services Agency, Californias Sustainable Building Task Force, and the California Department of General Services. The above studies mentioned the cost of a LEED building has many different factors that could impact the initial capital outlay. This report analyzes the costs factors that have the greatest impact on the initial cost, and the study offers suggestions on ways to manage those factors in order to keep the additional co sts at a minimum. The first cost factor detailed is the actual cost of LEED project management. The LEED project management process involves proper documentation, tracking, and submission of many different forms and letters to the USGBC. The process in w hich this step in the LEED process is performed can have a dramatic effect on the overall cost of a LEED project manager. According to the KEMA report, current estimates to document, manage, and report project compliance through the USGBC certification pr ocess range from approximately $10,000 to $60,000 per project. When expressed as a percentage of total project cost, the lower the overall project cost the greater the LEED project management budget is based on percentages. Therefore, on a smaller total project budget the LEED project management cost needs to reach the bottom of the above mentioned range.

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37 The second factor that may cause an increase to the overall project budget is the physical location of the project. The location of a project and the local jurisdictions may have a great impact on the costs of a building or the ability of the building to achieve a LEED rating in a cost effective manner. There are some examples listed in the report that may impact the ability of a building to achieve a LEED rating in the most cost effective way. Some examples include the wastewater regulations of a particular jurisdiction or state. In California, for example, the state plumbing code Section 406.2 reads, urinalswhich have an unventilated space or wal l which is not thoroughly washed at each discharge shall be prohibited. This code prohibits a cost saving alternative that enables the building to achieve some LEED credits. The third factor in managing the cost of a green building is the actual projec t factors themselves. The individual components of a project that must be managed include issues from decision maker buy in to contracting and project management. The members of the project team responsible for the efficiency of these factors would be the project managers and the owners representatives. The first factor which influences project cost is timing. In relation to the project start date, owners and designers should determine an integrated design process and green goals. The second factor to project cost control includes incorporating the specific green requirements in all RFPs and contracts. This will allow the contractors soliciting their services to be well aware of the desires and requirements of the building program. Another important factor in controlling project costs is the experience of the project managers involved. The project managers need to be familiar with the special requirements of the LEED rating system and how each credit targeted by the owner is to be achieved. The fi nal project cost factor would be to make sure that the value engineering process addresses the interdependence of all building

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38 systems. The value engineering process needs to allow enough time to review all of the costs and benefits of the different but i nterdependent building systems. The specific design of green buildings may also lead to an increased cost. The increased costs incurred by the design of sustainable buildings could be related to the increased energy models and building simulations perfo rmed, as well as life cycle costing and research into new and innovative materials and systems. Although the initial costs may be greater, according to the report, these costs can be recovered through reduced maintenance costs, reduced renovation costs, l ower debt service, decreased liability, and many more. According to the report, the greatest financial benefits of green building accrue in construction. With the implementation of the integrated design process from project development to construction a nd commissioning, fewer change orders occur which lead to a substantial cost savings. Although the construction phase of a project accrues the greatest savings there are some areas that need to be managed properly, or there will be additional costs associ ated. The proper contact listing of specific material and system suppliers for the possibly unique construction material or system for the project will alleviate any confusion that subcontractors may have. Another strategy that can mitigate the additiona l costs of commissioning would be to implement a commissioning plan throughout the entire project. All stakeholders of the project, including subcontractors, should know the plan. Change orders to the project can also increase the cost of the green build ing. In order to reduce the amount of change orders the integrated design team and commissioning agents should conduct periodic charrettes to ensure the team is proceeding, as the building program requires. The most difficult cost factor that may lead co ntractors over the project budget would be the additional costs associated with the documentation of required LEED materials. An example of this would be the

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39 detailed documentation of the labor and materials of a project must be separated. In order to re duce the risk of cost overruns the integrated design team should provide all contractors with a standard format on which to detail certain costs. After discussing how to mitigate the factors that may affect the cost of the project the report analyzes some strategies that may increase the design team and project managers efficiency to produce a green building. The report analyzes eleven different means of increasing the efficiency of the project team members, this portion of the literature review will disc uss some of the more important strategies involved in the project teams efficiency. The strategies that lend themselves to greater team efficiency include setting clear project and green goals, contracting for success, developing a good team, and incorpor ating an integrated design process. The initial setup of a building program is one of the most important phases of the project itself. While determining the project scope and objectives the proper green goals must be established. These objectives or goal s must have all team member buy in prior to the start of the project. The efficiency of all team players is determined by the initial goals and directions determined by the team members. The additional soft costs incurred to set goals and directions will drastically outweigh the costs incurred in order to change green objectives while the project is underway. Once the project team has been organized and briefed on the intent and design goals of the building program the next phase would include setting up the contractual obligations of each party. According to the report an owner should write RFPs and contracts that clearly describe green building requirements thereby saving time and as much as half the costs associated with implementing LEED. The repo rt also recommends that certain details of the RFPs to the different design teams and contractors include specific language that would select the best

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40 applicant for the job. The best applicant for the project should have prior sustainable or LEED project experience as well as strategies to implement and document the different LEED requirements. One recommendation for the contract form is what is known as a best -value bidding practice. That type of bidding practice sets a fixed price for a particular service and allows the potential bidder to describe the services they would provide for that fixed price. An example of this from the report is the Capitol Area East End Complex detailed below: Project teams responding to the RFP were required to incorporate specified sustainable features within the fixed project budget, but were also awarded points for incorporating additional green features, so -called innovation points. Although no additional funding was available, Block 225 (the first of the five buildings to be completed) achieved a LEED Gold rating, and included such innovations as a building integrated photovoltaic systemThe remaining four buildings in the complex went through a similar process and are expected to achieve the Silver level. This type o f contractual setup of the bidding process could improve the level of a buildings sustainability without increasing the original cost estimates. In order to deliver a LEED building within the owners budget guidelines is also determined by the composition of the team. The design and construction team of a LEED project experience the same learning curve as any other team would when designing and constructing a new building system. In order to reduce the risk and cost overruns associated with the learning process of the team, the owner should select team with prior LEED building program experience. According to the report, as project teams and design firms become more experienced with green building rating guidelines, specifically the LEED rating system a nd certification process, the number of hours necessary to implement, track, and document green building systems is reduced. The report offers four guidelines to proper team selection. The first would be the construction firms selection of a proactive and experienced project manager (PM). The experienced PM will be able to foresee problems that could limit the projects full potential to achieve all the LEED goals. Secondly, the design team chosen must have a culture

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41 of sustainability woven throughout the companys policies, and a firm that has previous experience with the sustainable systems that LEED may require. The design firm chosen should have multiple LEED Accredited Professionals on staff and at least one of the LEED -APs should be dedicated to the project. The design team should also have a history of collaborative and creative problem solving strategies. The third guideline the report mentions would be the incorporation of a LEED PM or a sustainability coordinator. This individual will be t he coordinator between the desires and goals of the building program and the design/construction team. An efficient LEED PM will address the construction specifications, plan and streamline the LEED documentation process, and address all of the design/construction team members sustainability concerns of the project. The final contributor of an efficient LEED team would be the hiring of a sound mechanical, electrical, and plumbing firm from the earliest stages of the design process. A majority of the ini tial cost increases of LEED projects arise from the high efficiency HVAC systems, building control systems, and other MEP system upgrades associated with LEED buildings. An example of the benefits of this step is KEMA Xenergy, a subsidiary of KEMA Group, has found that hiring the MEP early in the design typically leads to savings of at least 10% of the mechanical equipment and installation costs. The final factor that will lead to greater team and project efficiency is the incorporation of in integrated and holistic design process. In order to maximize the efficiency of the project budget the integrated design process includes the different green systems in the base project budget. This approach allows the owner and design team to realistically determine if the budget of the building is on target from previous estimates. If the budget is above the owners expectations the entire team can work cohesively to reduce the overall cost, not just the cost of the green systems. An example from the report expla ins that an analysis of KEMA Xenergy

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42 projects found that investing 3% of total project cost during design yields at least 10% savings in construction through design simplifications and reduced change orders. The report details five strategies to incorporate a successful integrated design process. The first step would be to make the LEED PM a contributing member of the team that will advise the design/construction team. The LEED PM should also development strategies for the team to streamline the submis sion of LEED documentation. The second step would be to include all other stakeholders of the project. The stakeholders could be contractors, property managers, real estate analysts, budget analysts, crew chiefs, and operations and maintenance staff on the design team. The third step is to use the integrated design process to propose solutions to building program issues so they do not become an additional program that can be deleted if necessary. The fourth factor would be the setting up of a LEED cha rrette by the LEED PM for the project. The charrettes participants include the design team, owner, building O&M staff, construction manager, and MEP contractors. The charrette should address all of the building program requirements and the LEED or susta inable philosophy behind the owners decisions. This aspect of the integrated design process will allow the different members of the charrette to achieve a certain level of buy in for the project. Finally, the on -site project manager or superintendent sh ould incorporate a LEED agenda into the weekly job-site meetings. The LEED agenda should make all the subcontractors on site at that time aware of all of their documentation and implementation requirements in order to meet the LEED standards. The incorpo ration of the five strategies contributing to a successful integrated design process will have an additional upfront cost, but this cost is small when compared to the cost of correcting mistakes and change orders later in the project.

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43 Cost of Green Revisi ted In 2004 Peter Morris and Lisa Fay Matthiessen, of Davis Langdon & Seah International, conducted a study on the cost of incorporating sustainable design features within building programs. The study in 2004 Costing Green: A Comprehensive Cost Database and Budget Methodology hoped to determine the actual cost of green buildings in three ways: the cost of incorporating individual sustainable elements, the cost of green buildings compared to a population of buildings with a similar program, and the cost of green building compared to their original budget. The paper analyzed in this literature review is an extension of the paper written in 2004. The Cost of Green Revisited uses the same three determining factors with a larger sample population with the addition of two different building types. The two reports are basing the sustainable buildings design level on the LEED rating system. The focus of the study is to determine if there is a significant difference in the cost per square foot between buildings with an intended LEED rating level and those projects of similar program type that are not pursuing any LEED rating. The study analyzes five different building types. The different types are academic buildings, laboratories, libraries, community cente rs, and ambulatory care facilities. There were a total of 221 buildings analyzed in this study, of which 83 were seeking a LEED rating. The other 138 buildings had similar programs but were not seeking a LEED rating. The first building type reviewed in the report was the academic building. The study focused on 60 total buildings, of which 17 were seeking a LEED rating. The report classifies an academic building as classroom, computer lab, or faculty office buildings in higher education settings. Th e report determined that the distribution of the cost per square foot between LEED seeking and nonLEED seeking buildings have no significant difference (Figure 31).

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44 The next building type analyzed was the laboratory building. The study focused it resear ch on 70 different buildings, of which 26 were seeking some level of LEED certification. The laboratories analyzed were comprised of teaching facilities, research facilities, and production facilities. The majority of the labs analyzed all showed similar characteristics with regard to their energy management and mechanical program goals. The result of the analysis of the laboratory buildings was in direct relation to the academic building. Again, there was not a significant difference between the cost p er square foot of the non-LEED seeking building programs when compared to the LEED seeking building programs. The report found that there is quite a wide range of square foot costs for the laboratories (Figure 3 2). However, the LEED seeking projects are distributed fairly evenly through the population. The third building type reviewed was a library. The study analyzed 57 different library projects, of which 25 were seeking some LEED certification. According to the report the libraries studied include community branch libraries, main public libraries, and university campus libraries. In the LEED rating system the libraries studied scored highly in the indoor environmental quality category. As the report shows, once again, there is no significant diff erence between the costs per square foot of the LEED seeking versus nonLEED seeking projects (Figure 3 3). Within in this set of data the LEED seeking libraries trend towards the bottom of the population. This trend could be attributed to the fact that libraries have become one of the more categories of new construction to embrace sustainable design. The fourth building type analyzed and an addition to the previous study was the community center. The study analyzed a total of 18 different community c enters, of which 9 were seeking some level of LEED certification. These building types include meeting spaces, educational spaces, gymnasiums, and recreational complexes. From the study of only 18

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45 buildings this data set is not large enough to determine a true distribution through statistical analysis. Although the sample set is small, the trend of distribution seems similar to the building types discussed previously. The distribution of LEED seeking versus nonLEED seeking is quite similar (Figure 3 4) The fifth and final building program type analyzed was the ambulatory care facility. An ambulatory care facility is a type of medical building that does not provide inpatient care. The buildings in this sample set include cancer treatment centers (excluding any radiation treatment elements), same day surgery suites, and ambulatory care centers. Medical Office buildings were not included. Similar to the community center, the data set is not large enough to determine a true distribution through statis tical analysis. Although the sample set is small, there seems to be a trend within the projects. This trend is displayed in the report, and is similar to the other building types which had large enough sample sizes to perform a statistical analysis (Figu re 3 5). According to the report, the nonLEED seeking building types could have achieved between 10 and 20 LEED points with their established designs and building programs. In conclusion, the study determined there was four key points drawn from the comp arison of LEED seeking versus non-LEED seeking buildings. They are as follows: there is a very large variation in costs of buildings, even within the same building category; cost differences between buildings are due primarily to program type; there are l ow cost and high cost green buildings; there are low cost and high cost non-green buildings. Following the conclusion of the above analysis, the report analyzes the feasibility and cost of LEED NC version 2.2. The review of that section of the report will discuss only the credits in which a soft cost impact to the contractor may be experienced. The review of that section of the report will discuss only the credits in which a soft cost impact to the contractor may be

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46 experienced. The review of the feasibi lity and cost analysis of the report will be displayed through a table that will aid in the visualization of the different credit costs and feasibilities. The credit feasibility chart is a visual representation of the analysis in which the report details the significance of the first cost of the credit in relation to design, construction, and other soft costs (See APPENDIX C). The amount or level of cost has been displayed by a number scale; negative 1 is a reduced first cost, 1 is a minimal first cost, 2 is a moderate first cost, and 3 is a substantial first cost to the owner. The tabled representation of the feasibility of each credit has the ability to display the total number of credits that incur a cost premium for a LEED project, according to the s tudy. While these findings may be pertinent to some of the projects studied for the report there exist some limitations and unexplained factors in the feasibility and cost analysis of each credit. An example of this can be found under Water Efficiency cr edit 2: Innovative Wastewater Technologies, in which the study reports that there would be moderate documentation costs associated with the necessary calculations and demonstration of compliance (Langdon 2007). This so -called added documentation is associ ated with other credits throughout the report. The additional documentation costs come from a service provided by the construction manager, design team, or subcontractor and must be accounted for in one of their project budgets. As a construction manager the additional documentation costs may be charged to a project engineer on the construction site that has to focus solely on a LEED related requirement for 20 hours that week. This additional time incurred by the project engineer has a direct cost to the construction manager, and the construction manager may charge the additional hours to the general conditions budget of the project. In order for an exact representation of the cost of a LEED building to be

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47 determined, Davis Langdon should have analyzed t he costs of the documentation effort in this study. Construction Industry Perceptions of Green Building The issue of cost in relation to the sustainable or green building movement has many different views with regard to the individuals within the constru ction industry. This section of the Literature Review will seek to analyze multiple construction industry surveys regarding the green building movement or LEED buildings. The following reports have sought to gauge the acceptance, understanding, and direc tion that the overall construction industry has towards the LEED building rating system and the notion of sustainability. Green Building Market Barometer for 2008 From August 12 thru September 14, 2008 Bayer Consulting distributed the 2008 Green Building Market Barometer survey to 754 executives in the construction industry. The survey attempted to gauge the green building issues through the online questionnaire. The main issues presented are as follows; the benefits of green buildings, the operating costs, the construction costs, the obstacles to green, and the role of the LEED system. According to the report, 75% of executives said that recent developments in t he credit markets would not make their companies less likely to construct green buildings (Turner 2008). This result of the survey speaks volumes for the growth and development over the past decade to the green building movement in the US. The review of this survey will focus on the section titled Overcoming the Obstacles to Green Construction. The participants of the survey were executives from different sectors of the construction and real estate industry. According to the report, the company type i ncluded developers (37%), owners of buildings (31%), brokers and other firms providing real estate services (27%), architectural, engineering, and construction firms (22%), corporate owner -occupants and tenants

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48 (10%) (Figure 3 6). The study also details t he types of facilities in which the respondent is involved with. According to the article, 49% of executives reported that they had green buildings in their portfolios, while 59% of corporate respondents said they owned or leased green buildings (Figure 3 6). The survey report details a section regarding the obstacles that need to be overcome for green construction to become a standard practice. In this portion of the survey the executives were asked to rank eight different factors in order of importance that were potentially discouraging to the construction of green buildings. The number one response, at 54%, was the amount of documentation required and the additional cost that it takes to make a green building LEED certified (Figure 3 7). The next extr emely or very significant hurdle was the higher construction cost of a green building at 50%. The higher cost perception has been proven wrong by many different studies. This report details a study by Davis Langdon that compared the costs of 221 building s, of which 83 were constructed as LEED rated buildings. This study determined that there was no significant difference between the costs of a LEED building compared to a building type with the same program. The perception the executives have that the cost of construction is too high leads to another factor in the survey. The lack of education with regard to the benefits is apparent in the survey response of 48% that viewed lack of awareness as a significant hurdle to sustainable construction. In order for the green building movement to advance the executives who make the decisions need to be better educated about the technologies and building practices which could make their properties healthier, smarter, and more cost effective. In conclusion, the Gr een Building Market Barometer for 2008 has displayed that the main barrier to the advancement of the green or LEED building would be the education of the real

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49 estate executives and property owners. The common misconception that a green building costs more to construct is due to the lack of education and understanding of what a green building actually is. The lack of awareness about the benefits that accompany green buildings is another major hurdle that needs to be overcome. The real estate executives ar e the decision makers with the capital to determine if a building should go green or not. Increased education and awareness about green buildings and construction will further advance the green building movement. Green Buildings and the Bottom Line In 20 04 the construction periodical, Building Design and Construction, published the first White Paper on Sustainability. Approximately three years later, in 2006, BD&C published a follow up report known as the 2006 White Paper on Sustainability. Since the fi rst paper was published the green building movement has grown and changed more than could have been foreseen. The report relates the beginning of the movement as a charismatic environmental crusade that has matured into an established sector of the US con struction industry (BD&C 2006). The White Papers from 2004 and 2006 have sought to gauge the construction industrys perceptions of the financial and economic dimensions of the green building movement through a questionnaire that was distributed to their 75,150 subscribers (BD&C 2006). The study focused on 10 different building types: office, retail, hotels, restaurants, homes, industrial, higher education, K 12 education, healthcare facilities, and government facilities. The analysis of the White Paper from 2006 will summarize the responses and findings that are detailed throughout the report. According to the report, the 75,150 architects, contractors, engineers, building owners, and developers who receive Building Design and Construction work at firm s that design and build 8085% of the annual $501 billion in commercial, industrial, institutional, and multifamily construction in the U.S. (BD&C 2006). The ability of the BD&C to have a research study based

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50 on the opinions of that group of individuals c reates a great market barometer. Of the 75,150 contacts to which the surveys were distributed, 827 returned a response. The level of respondents has increased by roughly 76%, from 495 to 827, since the first study was conducted in 2003. The increase in the level of response is an indication that the green building movement has sparked a greater interest among the BD&C readership. The increased awareness of the green building movement can be displayed through some key findings that are mentioned in the report. The BD&C details five main points determined from the responses of the survey, and they are described below (BD&C 2006). A majority of respondents (59%) said their firms were either very (14%) or somewhat (45%) experienced in green building, a significant increase from 2004 (49%) and 2003 (42%). A fifth of respondents (20%) reported that their firm had achieved green certification for at least one project; 36% said they had completed at least one project based on sustainable principles. A soli d majority (57%) of those surveyed said first cost was still an obstacle to convincing owner and developers to go green, even when the long-term savings of sustainable design were made clear. Fifty -six percent of respondents said they thought clients saw green buildings as adding significantly to first costs. As in 2003 and 2004, respondents felt strongly (4.40 on a scale of 5) that green products and building materials should be evaluated on the basis of life cycle analysis, longterm durability, and maintenance, not just environmental impact and energy savings. Three -fourths of respondents (75%) said that they wanted more information on the relative costs and benefits of green buildings versus conventional buildings, based on independently validated documentation. The major findings of this study compose a broad picture about the direction of the green building movement before the global economic downturn that has occurred since the study was concluded. It would be interesting to resend the survey to the respondents and gauge how the

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51 majority of respondents surveyed (57%) which view the first cost of a green building as the main barrier to the green building movement, based on the present financial climate. The perception that the first costs of a g reen building are a significant increase to conventional construction is still a major barrier to the advancement and construction of green buildings (Figure 3 8). Even with the major findings detailed above, the hurdle is still the owner or developers p erception of first cost. In order to break down the perception of an increased first costs there are a few steps that the recent graduates entering the construction field must pursue. First, the recent graduate who enters the construction must educate the upper management of the benefits of green buildings as it relates to the environment, community, and building costs. Secondly, the recently hired graduate must advance the green building movement by helping the owners and developers better understand how to effectively manage and construct a green building. There are many different studies that have determined that a LEED building can be built at little to no cost premium if the project is managed efficiently from the early design stages. Even with the misconceptions throughout the industry of first costs there is still momentum building behind the green building movement. Another survey question in the study asked how active in the sustainable movement the firm would be over the next 2 to 3 years. No t surprisingly, the percent of respondents who said their firm would be significantly more active rose to 30% in 2006 from 24% and 16% in 2004 and 2003 respectively (BD&C 2006). Another indicator of the green building movement was the percentage of resp ondents who stated that their firm would not be active at all in the movement. The percentage decreased from 12% in 2003 to just 3% in the 2006 edition (BD&C 2006). The above responses paint a broad picture of the momentum of the green building movement. The movement was showing positive growth

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52 during the report in late 2006. A follow up to this survey section during the economic crisis would be an excellent way to gauge the strength of the sustainable movement. In conclusion, the BD&Cs White Pape r from 2006 was able to determine that the green building movement has gained momentum since the first White Paper was produced. From the first survey conducted in 2003 to the 2006 survey, a 76% increase in the number of respondents lends the reader to be lieve that the issue of sustainability is a more important to the construction industry than it has been in the past. Since the survey was conducted in late 2006, it would be very intriguing to conduct the same survey in this period of global economic tur moil. Would the respondents feel even stronger about the benefits of green buildings, or would the issue of first cost be the most important factor facing owners? The first cost of a LEED or green building has proven to be one of the major hurdles that all owners, developers, and contractors seem to encounter when developing building programs. This section has analyzed some of the more significant publications and studies with regard to the costs associated with a green building. In order to mitigate or reduce costs completely, there are some best management practices that need to be implemented throughout the life cycle of the project. As detailed earlier, the entire project team should be involved in an integrated design and construction process, and the building program and sustainability goals must be established from the very early design stages of the project. In order to reduce construction costs to the owner, the contractor chosen must have a prior history of LEED or green construction experien ce in order to reduce or eliminate the cost of a learning curve. The above suggestions will make the project phases more efficient, thereby reducing the overall cost. In addition to the above steps for construction, the perception that LEED or green buil dings cost a premium needs to be overcome through the education of all owners and developers. According to the BD&C

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53 numerous mega -sized finance institutions have begun to construct LEED rated buildings for their portfolios. If the largest of corporatio ns are constructing green or LEED buildings, it must make financial sense to build green. The research studies discussed in this literature review increase the body of knowledge for the LEED building system. The studies analyzed and determined the many different contributing factors to the additional costs associated with the LEED building rating system. The factors that, from the studies, seem to contribute the most to an increase in the cost of a LEED building would be additional design costs and the increased costs of specialty systems. The studies seem to disregard a major stakeholder of the LEED building process, the contractors. The studies also neglect to separate the projects analyzed by location that could also contribute to an additional var iance in the cost models. The disregard to location and all of the stakeholders leaves a void in the above research studies. The upcoming Results chapter of this thesis will discuss the survey responses that were developed to incorporate the construction industrys opinions on a regional basis.

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54 Table 3 1 New courthouse construction cost i mpacts New c ourthouse (262,000 GSF, base construction c ost = $220/GSF) Certified Silver Gold 1A Low c ost 2A High c ost 3A Low c ost 4A High c ost 5A Low c ost 6A High c ost LEED construction cost i mpacts $/GSF ($0.76) $2.18 ($0.07) $9.57 $2.97 $17.79 % Change 0.40% 1.00% 0.03% 4.40% 1.40% 8.10% Table 3 2 Office building modernization cost i mpacts Office building m odernization (306,600 GSF, base construction c ost = $130/GSF) Certified Silver Gold 1B Min. f aade 2B Full f aade 3B Min. f aade 4B Full f aade 5B Min. f aade 6B Full f aade LEED construction cost i mpacts $/GSF $1.78 $2.73 $3.94 $5.55 $10.58 $10.22 % Change 1.40% 2.10% 3.10% 4.20% 8.20% 7.80% Table 3 3 Office building modernization soft cost i mpacts Office building m odernization (306,600 GSF, base construction c ost = $130/GSF) Certified Silver Gold 1B Min. f aade 2B Full f aade 3B Min. f aade 4B Full f aade 5B Min. f aade 6B Full f aade LEED soft cost i mpacts Expert consultant a pproach ($/GSF) $0.41 $0.41 $0.44 $0.49 $0.70 $0.69 experienced design team a pproach ($/GSF) $0.35 $0.35 $0.38 $0.44 $0.59 $0.58

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55 Table 3 4 New courthouse soft cost i mpacts New c ourthouse (262,000 GSF, base construction c ost = $220/GSF) Certified Silver Gold 1A Low c ost 2A High c ost 3A Low c ost 4A High c ost 5A Low c ost 6A High c ost LEED soft cost i mpacts Expert consultant a pproach ($/GSF) $0.41 $0.46 $0.41 $0.55 $0.61 $0.80 experienced design team a pproach ($/GSF) $0.43 $0.45 $0.44 $0.54 $0.56 $0.73 Figure 3 1. Academic buildings distribution of cost ($/GSF). (Source: Matthiessen, L.F., Morris, P. Costing Green Revisited: Reexamining the Feasibility and Cost Impact of Sustainable Design in the Light of Increased Market Adoption. Davis Langdon. July 2 007.)

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56 Figure 3 2. Laboratory buildings distribution of cost ($/GSF). (Source: Matthiessen, L.F., Morris, P. Costing Green Revisited: Reexamining the Feasibility and Cost Impact of Sustainable Design in the Light of Increased Market Adoption. Davis Lan gdon. July 2007.) Figure 3 3. Library buildings distribution of cost ($/GSF). (Source: Matthiessen, L.F., Morris, P. Costing Green Revisited: Reexamining the Feasibility and Cost Impact of Sustainable Design in the Light of Increased Market Adoption. D avis Langdon. July 2007.)

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57 Figure 3 4. Community centers distribution of cost ($/GSF). (Source: Matthiessen, L.F., Morris, P. Costing Green Revisited: Reexamining the Feasibility and Cost Impact of Sustainable Design in the Light of Increased Market Adoption. Davis Langdon. July 2007.) Figure 3 5. Ambulatory cares distribution of cost ($/GSF). (Source: Matthiessen, L.F., Morr is, P. Costing Green Revisited: Reexamining the Feasibility and Cost Impact of Sustainable Design in the Light of Increased Market Adoption. Davis Langdon. July 2007.)

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58 Figure 3 6. Type of company & facilities respondents manages. (Source:Turner Construc tion Company. 2008 Green Building Market Barometer. www.turnerconstruction.com/greenbuildings Last accessed April, 2009) Figure 3 7. Executives response to the discouraging factors. (Sourc e: Turner Construction Company. 2008 Green Building Market Barometer. www.turnerconstruction.com/greenbuildings Last accessed April, 2009)

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59 Figure 3 8. Owner and developer perceptions of the barriers to green development. (Source: Cassidy, R., et al. Green Buildings and the Bottom Line: Building Design & Construction. November 2006).

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60 CHAPTER 4 RESULTS The participants responses are analyzed in two separate sections of the Results ch apter. The Response Analysis section provides the responses to each survey question. The responses are separated into three separate sections; the participants information, their employers information, and cost perception responses. The initial analys is discussed the average, minimum, and maximum response for each question or statement. Once the responses were analyzed, an analysis of the noticeable trends to responses was discussed. The Descriptive Analysis section analyzed data from the first analys is when it was difficult to determine a trend towards any level of response. This section sought to separate the respondents into categories in order to determine if there is a trend within responses based on the individual categories the companies were s eparated into. The categories included company annual revenue, company size, and company experience with LEED or green construction. In this analysis 5 of the 14 questions were compared based on the different company categories. The main problem of the Results chapter in this study is the limited number of survey responses collected. Through the course of the study only 16 survey responses were returned out of a possible 200 that were distributed to the local construction industr y. Of the 16 survey responses only 11 were able to contribute to the study based on geographic location and relationship to the construction industry.

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61 Response Analysis Personal Information Participant profession The profession of the participants i ncluded 11 general contractors from the region surveyed (Figure 4 1). The overwhelming response by the general contractors could show the interest associated with the costs of LEED construction for a general contractor. Participant position There were a total of 11 responses to the question about the position in the company the participant held (Figure 4 2). Of the 11 responses, 5 of the participants were the owner/president of the company, 6 were either project managers or senior project manager. The high organization level of the participants within the company may lead to a more accurate representation of the perceptions of the local construction industry as a whole. Company l ocation The location of companies surveyed was predominately in Gainesville with 10 of the 11 responses (Figure 4 3). The other city from the respondents was Ocala. Gainesville is quite unique to the State because of the local legislation and the University of Floridas commitment to a LEED requirement for all buildings. This greatly enhances the contractors exposure to the LEED system when compared to the companies responding from either South Florida or Central Florida. Company Profile Years in b usiness There were 11 qualified responses to this question as well. The average age of the companies surveyed was 16 years old. The oldest company responded has been in business for 47 years and the youngest company to respond was 5 years old. The largest age g roup surveyed

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62 has been in business for at least 20 years and from 6 to 10 years, with 3 companies each (Figure 4 4). Professional service p rovided The majority of companies provide general contracting services to their clients (Figure 4 5). The other s ignificant service category included providing a multi -disciplinary service to clients. Multi -disciplinary services include design -build, construction management, and general contracting project delivery methods for owners to choose from. Sales r evenue i n 2008 The annual revenues for the companies surveyed averaged $38 million, with maximum revenues of $150 million and a minimum of $5 million. There were 11 recordable responses (Figure 4 6). The greatest number of responses for a single category was 5 i n the $21 million to $40 million in annual construction revenue. In the following section of the Analysis chapter the relationship between annual company revenue and their perceptions of the cost of LEED will be discussed. Percent of annual v olume LEED T he average percent of annual revenue of LEED construction for the companies surveyed was around 8% (Figure 4 7). The maximum percentage of LEED construction from a single respondent was 25% while a majority of the companies were at 0% (6) for LEED constru ction revenue. Percent of annual v olume g reen not LEED The annual volume of construction revenue that is considered green but not achieving any level of LEED certification had an average of roughly 16% with a maximum of 100% and a minimum of 0%. Th ere were only 2 responses above 20% at 80% and 100% respectively (Figure 4 8).

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63 Number of salaried e mployees The varying sizes of the companies surveyed are displayed in this section (Figure 4 9). The maximum number of salaried professionals is 120 with a minimum of 6. The average number of salaried professionals is 30. The largest group was in the 10 to 20-employee range with 5 companies in that category. In the following section of the Analysis chapter, the relationship between company size and LEED cost perceptions will be discussed. Num ber of LEED APs in c ompany The numbers of LEED APs in the companies surveyed are determined from this question. The average number of LEED APs is 5.6, while the maximum is 25 and the minimum is 0 (Figure 4 10). The largest category group is the 0 to 5 category with 9 companies. The number of LEED APs within an organization may have an effect of the perceptions associated with LEED buildings. Therefore, in the next section of the Analysis chapter this relationship will be discussed. Title of LEED APs in c ompany The majority of the positions that have a LEED AP are the owner/president and the project managers (Figure 4 11). The reason the quantity of positions is greater than the number of responses is due to the fact that companies have multiple positions that are LEED APs. A single company may have LEED APs that are president, project manager, and estimator. LEED Cost P erceptions This section of the survey was developed in order to determine the respondents perceptions of the LEED building rating system and their associated costs. The participants were asked to read the statements and determine their level of agreement with a 1 to 7 Likert scale. A response of 1 signifies Strongly Disagree, 4 signify a Neut ral response, and a 7 signifies a response of Strongly Agree. The average of each question response is discussed in the analysis

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64 as well as any noticeable trends in favor of a certain level of agreement between the statements and responses. Budget and schedule for LEED vs. conventional p rojects The first question of the LEED perception survey was developed to determine the participants view of project budget and schedule similarities between a LEED project and a project not pursuing a LEED rating. The 11 responses had an average response of 2.5 (Figure 4 12). The response average indicates that the respondents tend to disagree with the statement. The average response is similar to the distribution of responses. The bar graph shows the distribution of t he responses to be within the Somewhat Disagree to the Strongly Disagree category. This response trend shows that all of the participants believe that there is a disparity between the budgets and schedules of LEED projects versus conventional projects. F irst cost as a barrier to sustainable d esign The second question of the cost survey was developed to determine the perception the participants had with regard to the first costs associated with green buildings being a major barrier to the sustainability movement. The average response is 5.1, which indicates the respondents view as slightly less than Somewhat Agree to cost being a major hurdle to sustainable design (Figure 4 13). The distribution of responses is fairly even throughout the Likert scale. I ndividual promotion of LEED Question 3 of the cost perception survey sought to determine the individuals efforts to promote the idea of LEED into their clients buildings. The average response was 5, which is the Somewhat Agree response. The 11 response s were mainly grouped in the Agree and Neutral categories, which led to the average response falling near the Somewhat Agree category (Figure 4 14). This response could be seen as a positive sign for the LEED building system in North

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65 Florida. The more th e construction industry tries to promote the philosophies of the green building or LEED system, the more exposure the system will receive. The increased exposure of the LEED system will hopefully lead to an increase in education and awareness of the benefits to the owner. Premium cost for LEED v s. c onventional This survey question sought to determine if the individuals company increased their project budget based solely on a LEED building in relation to a conventional building type. From the survey the average response was 4.4, which is slightly above the Neutral response category (Figure 4 15). Although the average is around the Neutral category a greater concentration of responses is above the Neutral category. This response may signify a change to the local construction industrys perceptions of the LEED building system. The responses that stand out for this statement would be the 3 Strongly Agree and 3 Strongly Disagree responses. In the following section of the Analysis chapter the relationship between this question and company revenue, size and experience will determine if those factors are relevant to the additional costs a company may or may not add for a LEED project. LEED p remium is included in general c onditions The survey sought to determine if there was a premium associated with a LEED project, and if so, the participants company included the additional cost in the general conditions of the project budget. The average response to the statement relating the LEE D premium to an increase in the general conditions budget was 4.9. The average correlates to a response average between the Neutral and Somewhat Agree categories (Figure 4 16). The distribution of survey responses have a trend toward the Agree and Strongly Agree categories, with the 3 Strongly Disagree responses drawing down the average response.

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66 LEED required materials have a premium cost Another factor of cost associated with a LEED building could be the types of materials required to meet certain LEED credits. A majority of the participants Agree with the survey statement (Figure 4 17). The average response was 5.7, which is between the Somewhat Agree and Agree category. The general distribution of responses is between Somewhat Agree and Strongly A gree (10 of 11). The response distribution between Somewhat Agree and Strongly Agree displays the perceptions that the local construction industry has with regards to LEED required materials. The belief that LEED materials have an additional cost to them could directly affect the overall project budget when compared to a conventional building. Documentation for LEED vs. c onventional The documentation efforts for a LEED project compared to the documentation requirements of a conventional project were to be compared in this statement. The cost of documentation efforts has been overlooked by many of the studies from the Literature Review. The average response to this statement was at 6.2 (Figure 4 18). This shows a trend that a great number of the respondents feel that there is extra documentation cost required for a LEED project as opposed to a nonLEED project. Of the 11 responses, 10 of the responses were either from the Agree or Strongly Agree categories. Profit of LEED vs. c onventional This question sought to relate the level of profitability that a LEED project may have when compared to a conventional project. The average response was 3.2, which is close to the Somewhat Disagree category. The 11 responses in show that a majority of the respondents perceive the profit for a LEED building versus a non -LEED building as negligible at best (Figure 4 19). The perception that a LEED rated project is not more or less profitable for a local contractor may contribute to the advancement of LEED buildings in North Florida.

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67 LEED requirements add s cope Question 9 sought to determine if the participants viewed a LEED projects requirements as an addition to the scope of the project above and beyond that scope if the building was a conventional building. The average response was at 5.8, which trends towards the Agree category. The response distribution is between the Neutral and Strongly Agree categories (Figure 4 20). The responses lead to a general perception that LEED buildings have additional scope when co mpared to conventional buildings. The perception that additional scope is required of a LEED project is an important factor of the overall cost of a project. The local construction industrys perception that LEED projects require an addition to their sco pe above and beyond a conventional project may increase the overall contract price to the owner. LEED will become standard in c ompany This statement sought to determine if the participants company was moving towards a LEED standard of construction proje ct management, and if so would the company assess an additional cost for LEED required services. The responses had an average of 3.0 (Figure 4 21). With a broad distribution of responses it is difficult to determine the general perception of the particip ants. This question will be analyzed in the following section of the Results chapter. LEED project size & complexity affects p remium This statement was developed in order to determine the relationship between the size of the LEED project and the resulting cost premium that the local company may or may not add to the project budget. The average response was 5.4, or a Somewhat Agree to Agree response. The distribution of the responses trends towards the Strongly Agree category (Figure 422). With the incl usion of additional survey responses the average may trend upwards in the same manner.

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68 Documenting LEED requires extra t ime The documentation associated with the LEED requirements may contribute to additional time spent on the project by different project personnel. Additional time required to focus on LEED related project requirements may increase the construction budget of a LEED building versus a conventional building. The statement had an average response of 5.6, between the Somewhat Agree and Agree c ategories. The distribution of responses is mostly from the Somewhat Agree to Strongly Agree categories (Figure 4 22). Of the 11 responses only 1 was that of Strongly Disagree. This response trend displays the local industrys view of the additional lab or required of project team members in order to comply with all of the LEED documentation requirements. Financial risk of LEED vs. c onventional The amount of financial risk perceived on a LEED project is discussed in this statement. The average response rate was 2.5, with the distribution of responses from Neutral to Strongly Disagree (Figure 4 24). However, of the 11 responses the average response of 2.5 shows that the local construction industry does not believe that a LEED project has more financial risk than a conventional project. LEED risk vs. p remium The statement sought to determine the relationship between the risks associated with LEED requirements, and the cost premium charged by the local company based on the increased risk. The average re sponse was 4.9, in the Somewhat Agree category. The distribution of the responses is fairly even throughout the 11 responses that could be due to the quantity of responses (Figure 4 25). However, if there is a trend that leads to the local industry relat ing a risk of the LEED requirements and cost increases incurred from that risk, owners need to know this information.

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69 Descriptive Analysis This section of the Results chapter will discuss the relationships between the local companies revenues, sizes, an d LEED project experience in relation to the perceptions about the first costs of LEED projects. The analysis for this report could not be based on statistical data sets due to the lack of survey responses. Therefore, the descriptive analysis will focus on the survey statements which had a broad range of responses, or a group of responses in which a trend could not be seen. The statements that had a broad distribution of responses with no noticeable trends were: First cost is still seen as the single gre atest barrier to sustainable design Your firm charges a premium for a LEED project as opposed to an equivalent conventional project. You address the premium charged for LEED projects in the General Conditions of the project budget. Eventually, LEED will be come standard practice in my company, and my company will reduce the premium for LEED services. If the project has a greater perceived risk, related to LEED, the cost increases in relation to the risk. Descriptive Analysis of Company Size and Cost Percepti ons The separation of company size for the descriptive analysis are as follows; a small company is from 0 to 10, a medium company is from 11 to 20, a large company is from any company with more than 20 salaried professionals. The numbers of respondents of salaried employees for each category are 3 for small, 5 for medium, and 3 for a large company. The comparative analysis of the company sizes was quite difficult to analyze due to the lack of survey responses (11). However, with the limited amount of sur vey responses some trends in the average responses are described in the following sub-sections.

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70 First cost as a barrier to sustainable d esign The descriptive analysis of the different sizes of the companies when relating them to their level of agreement th at the first costs of sustainable design are a barrier is discussed. The results of the analysis do not seem to show any trends in the beliefs of the respondents based on the size of the company, to either disagree or agree with the statement (Figure 4 26). There is an interesting disparity, however, between the small and large companies (0 to 10 and >20) and the medium sized company (11 to 20). The small and large companies average responses were between Somewhat Agree and Agree categories, while the m edium companies responses were between the Neutral and Somewhat Disagree categories. The disparity in opinions could be due to many different reasons that this study will not be able to discuss due to the lack of survey responses. Premium cost for LEED v s. c onventional It is quite difficult to notice any sort of trend in the belief that there is a relationship between the size of the participants company and the perception that their company charges a premium for a LEED building (Figure 4 27). As in the original analys is, Figure 4 15 shows that the Neutral average coincides with the somewhat equal distribution of the averages between the differing company sizes. LEED premium is included in the general c onditions Following the same trend as the first two statements, th e relationship between the company sizes and the inclusion of an additional cost for LEED in the General Conditions is difficult to analyze due to their being a limited number of responses. There is no apparent trend that a company, large or small, has a preference of where the additional cost for LEED services will be located in the project budget (Figure 4 28).

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71 LEED will become standard in c ompany The descriptive analysis of this statement revealed no trend between company size and the possibility of LEED requirements becoming standard practice for the local construction industry. The response analysis has been unable to determine a trend in the levels of agreement (Figure 4 29). LEED r isk vs. p remium The relationship between company size and the risk of a LEED project increasing the premium shows a trend in the negative direction (Figure 4 31). The small companies have an average of Agree/Strongly Agree, while the large companies have an average respo nse of Neutral. This downward trend in agreement could be the result of many different factors, such as project location, specialized systems, and owner program requirements. Descriptive Analysis of Company Annual Revenue and Cost Perceptions The purpos e of this portion of the analysis is to determine if there are any trends when relating the annual revenue of a local construction company and the perceptions they may have towards statements, which from the preliminary analysis showed a broad distribution of responses. The descriptive analysis of annual company revenue separated the respondents companies into three different categories; small revenues are from $0 to $20 million, medium revenues are from $21 to $40 million, and large revenues are greater than $40 million in annual construction sales. The pool of respondents consisted of 4 small companies, 5 medium companies, and 2 large companies. First cost as a barrier to sustainable d esign The relationship between the levels of agreement regarding th e first costs of sustainable design being a barrier to the green building movement displayed no trend (Figure 4 31). The graph shows an average response between the Neutral and Agree categories. The amount of

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72 annual revenue a company generates, according to the responses, seems to have little effect on the perspectives the respondents have. Premium cost for LEED vs. c onventional The statement regarding a company charging an additional cost for a LEED building when compared to conventional building shows a slight negative trend in agreement. The average response rate for the small companies is Somewhat Agree (Figure 4 32). Following a negative trend in agreement, the average response rate reduces to Neutral from the medium to large companies. Overall, th ere seems to be a general trend of the larger the annual revenue, the less likely they are to charge an additional cost for a LEED building. LEED premium is included in the general c onditions The comparison between the inclusion of the LEED cost in the General Conditions of a project and the company annual revenue shows a slight trend in negative agreement as annual revenue increases. The average responses between the small and medium companies are around the Agree category. As the company annual revenue increased from that point the average response decreases to Neutral (Figure 4 33). The responses seem to show a general trend that the larger the annual revenue is of a company, the less likely they are going to include the additional cost of a LEED building in the General Conditions. LEED will become standard in c ompany The participants future view of the LEED system being implemented into their companys standard operating procedures, thereby reducing the additional cost incurred, was compared to the av erage response by annual revenue (Figure 4 34). After reviewing the comparison there are no resulting trends from this comparison. The responses of the three different categories are all grouped around the Somewhat Disagree category.

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73 LEED risk vs. p rem ium The perception that if there was a LEED premium, it would increase in relation to the risk of the LEED requirements does not reveal any trend between the differing annual revenue groupings (Figure 4 35). The three different groupings share the same opinion of Somewhat Agree with the statement. Descriptive Analysis of Company LEED or Green Experience and Cost Perceptions The purpose of this section of the analysis is to determine if there are trends when relating the companys experience with either L EED or green construction practices. The two percentages that respondents submitted for their companys experience with LEED and green construction were combined into an overall percentage of annual revenue. The combination of the two groups allows f or a better distribution of the level of experience for the comparison. The percentages of annual volume are separated into three different categories. The numbers of respondents for the categories are as follows; 5 responses for no experience (0%), 4 re sponses for some experience (1% to 45%), and 2 responses for very experienced (> 45%). First cost as a barrier to sustainable d esign The separation of the survey respondents based on level of LEED & green building experience did not lead to any sort of trend with the opinion of first cost issues being a major hurdle to the advancement of sustainable design. The average responses varied from just less than the Somewhat Agree to just above Somewhat Agree response categories (Figure 4 36). A trend in ave rage response may be recognizable if the survey quantity increases to a significant sample population. Premium cost for LEED vs. c onventional The average response rate for the perception that a LEED project has an additional cost above that of a conventi onal building was quite intriguing. There is a noticeable trend of

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74 increasing agreement from the no experience category to the very experienced category of companies. The companies with no experience with either LEED or green construction practices avera ged a Neutral response, while the very experienced companies averaged a Strongly Agree response (Figure 4 37). The disparity in responses seems to be related to the actual LEED or green construction experience the firms of the very experienced group have. If the very experienced group of local companies generally agrees that there is an additional cost for LEED or green construction, which is a good indicator of the additional project cost to an owner being a reality. LEED premium is i nclude d in the general c onditions The grouping of the local companies into categories based on LEED or green construction experience was able to display a positive trend in the response based on experience. The data set shows an increase in the agreement, from Somewhat Agr ee to Strongly Agree, of the response based on company experience from the no experience through the very experienced categories (Figure 4 38). This response trend relates to the above statement regarding the additional costs of LEED or green construction LEED will become standard in c ompany The average response for the entire population of respondents was between Somewhat Disagree (Figure 4 39). All of the responses averaging Somewhat Disagree points to the difficulty that the LEED rating system has inc orporating itself within the local construction industry. LEED risk vs. p remium The comparison of the average response between the differing levels of LEED or green project experience was unable to determine a relationship, either increasing or decreasing in agreement (Figure 4 40). The majority of the average responses were from Som ewhat Agree to

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75 the Agree response categories. This average of the responses could be due to the limited number of responses analyzed for the study. The analyses of the results for the survey detail the local construction industrys different perceptio ns regarding the costs associated with LEED construction projects. Conclusions to the study and recommendations for future study will be presented in the following chapter.

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76 Figure 4 1. Profession of the participant (N=11) Figure 4 2. Job title of t he participant (N=11) 0 2 4 6 8 10 12 Architect General Contractor Subcontractor Supplier Other Participant Profession Quantity 0 1 2 3 4 5 6 7 Participant Job Title Quantity

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77 Figure 4 3. City company is located (N=11) Figure 4 4. Years companies surveyed have been in business (N=11) 0 2 4 6 8 10 12 Gainesville Ocala Lake City Other Location of Company Quantity 0 1 2 3 4 0 5 6 to 10 11 to 15 16 to 20 21 and greater Company Years of Service Quantity

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78 Figure 4 5. Services provided to client by company (N=11) Figure 4 6. Annual construction revenue (N=11) 0 1 2 3 4 5 6 7 8 Service Provided Quantity 0 1 2 3 4 5 6 $0 to $1.0M $1.0M to $5.0M $6.0M to $10.0M $10.0M to $20.0M $21.0M to $40.0M > $40.0M Annual Construction Revenue ($) Quantity

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79 Figure 4 7. Company annual revenue that has achieved LEED certifications (N=11) Figure 4 8. Percent of construction revenue which is green not LEED (N=11) 0 1 2 3 4 5 6 7 8 0% to 5% 6% to 20% > 20% Percent of Annual Volume LEED Quantity 0 2 4 6 8 10 0% to 5% 5% to 10% 10% to 20% > 20% Percent of Anual Volume "Green" if not LEED Quantity

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80 Figure 4 9. Quantity of salaried professionals in company (N=11) Figure 4 10. Quantity of LEED APs in company (N=11) 0 1 2 3 4 5 6 0 to 10 10 to 20 21 to 40 > 40 Number of Salaried Employees Quantity 0 2 4 6 8 10 0 to 5 5 to 10 10 to 20 > 20 Number of LEED APs in Company Quantity

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81 Figure 4 11. Title of LEED AP within company structure (N=11) Figure 4 12. Budget and schedules of LEED projects and conventional projects are equal (N=11) 0 1 2 3 4 5 6 7 8 9 Title of LEED AP in Company Quantity 0 1 2 3 4 5 6 7 Strongly Disagree Disagree Somewhat Disagree Neutral Somewhat Agree Agree Strongly Agree Budget & Schedule Similarity Quantity

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82 Figure 4 13. First cost as a barrier to sustainable design (N=11) Figure 4 14. Individual promotes LEED rating system to prospective clients (N=11) 0 1 2 3 4 5 Strongly Disagree Disagree Somewhat Disagree Neutral Somewhat Agree Agree Strongly Agree First cost seen as a barrier to "green" Quantity 0 1 2 3 4 5 Strongly Disagree Disagree Somewhat Disagree Neutral Somewhat Agree Agree Strongly Agree Participant promotes LEED buildings to clients Quantity

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83 Figure 4 15. Premium associated with LEED building as opposed to conventional (N=11) Figure 4 16. LEED premium is added to the General Conditions of the budget (N=11) 0 1 2 3 4 5 Strongly Disagree Disagree Somewhat Disagree Neutral Somewhat Agree Agree Strongly Agree Company charges a premium for LEED Quantity 0 1 2 3 4 5 Strongly Disagree Disagree Somewhat Disagree Neutral Somewhat Agree Agree Strongly Agree The LEED premium is an addition to General Conditions Quantity

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84 Figure 4 17. LEED required materials have an additional cost (N=11) Figure 4 18. LEED documentation is greater than non-LEED documentation (N=11) 0 1 2 3 4 5 6 Strongly Disagree Disagree Somewhat Disagree Neutral Somewhat Agree Agree Strongly Agree LEED required materials have an additional cost Quantity 0 2 4 6 8 Strongly Disagree Disagree Somewhat Disagree Neutral Somewhat Agree Agree Strongly Agree LEED documentation requires additional project team effort Quantity

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85 Figure 4 19. LEED projects profit more than non -LEED buildings (N=11) Figure 4 20. LEED requirements add scope above non-LEED project scopes (N=11) 0 1 2 3 4 5 6 7 Strongly Disagree Disagree Somewhat Disagree Neutral Somewhat Agree Agree Strongly Agree LEED projects are more profitable than conventional Quantity 0 1 2 3 4 5 6 Strongly Disagree Disagree Somewhat Disagree Neutral Somewhat Agree Agree Strongly Agree LEED requirements is additional scope compared to conventional scope Quantity

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86 Figure 4 21. LEED to become standard practice of company (N=11) Figure 4 22. The correlation between LEED project size and any resulting LEED premium (N=11) 0 1 2 3 4 Strongly Disagree Disagree Somewhat Disagree Neutral Somewhat Agree Agree Strongly Agree LEED will become standard practice in future Quantity 0 1 2 3 4 5 6 Strongly Disagree Disagree Somewhat Disagree Neutral Somewhat Agree Agree Strongly Agree LEED project size determines additional LEED fee Quantity

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87 Figure 4 23. LEED documentation requires additional time for project team (N=11) Figure 4 24. LEED projects have a greater financial risk than nonLEED projects (N=11) 0 1 2 3 4 5 Strongly Disagree Disagree Somewhat Disagree Neutral Somewhat Agree Agree Strongly Agree LEED requirements add time to project team's work load Quantity 0 1 2 3 4 5 Strongly Disagree Disagree Somewhat Disagree Neutral Somewhat Agree Agree Strongly Agree LEED projects have greater financial risk Quantity

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88 Figure 4 25. Project risk due to LEED requirement will increase LEED premium (N=11) Figure 4 26. Average response based on companys salaried personnel in relation to first cost as a barrier to sustainable design 0 1 2 3 4 Strongly Disagree Disagree Somewhat Disagree Neutral Somewhat Agree Agree Strongly Agree Risk of LEED increases project cost Quantity 0 1 2 3 4 5 6 7 0 to 10 11 to 20 >20 First cost is still seen as the single greatest barrier to sustainable design Likert Scale Average

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89 Figure 4 27. Average response based on companys salaried personnel in relation to the firm charging a premium for LEED vs. conventional projects Figure 4 28. Average response based on companys salaried personnel in relation to the LEED premium in the general conditions 0 1 2 3 4 5 6 7 0 to 10 11 to 20 >20 Your firm charges a premium for a LEED project as opposed to an equivalent conventional project Likert Scale Average 0 1 2 3 4 5 6 7 0 to 10 11 to 20 >20 You address the premium charged for LEED projects in the General Conditions of the project budget Likert Scale Average

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90 Figure 4 29. Average response based on companys salaried personne l in relation to LEED becoming standard practice Figure 4 30. Average response ba sed on companys salaried personnel in relation to LEED risk vs. cost increase 0 1 2 3 4 5 6 7 0 to 10 11 to 20 > 20 Eventually, LEED will become standard practice in my company, and my company will reduce the premium for LEED services Likert Scale Average 0 1 2 3 4 5 6 7 0 to 10 11 to 20 > 20 If the project has a greater risk, related to LEED, the cost increases in relation to the risk Likert Scale Average

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91 Figure 4 31. Average response based on company annual revenue in relation to first cost as a barrier to sustainable design Figure 4 32. Average response based on company ann ual revenue in relation to a premium charged for a LEED vs. conventional project 0 1 2 3 4 5 6 7 $0 to $20M $21.0M to $40.0M > $40.0M First cost is still seen as the single greatest barrier to sustainable design Likert Scale Average 0 1 2 3 4 5 6 7 $0 to $20M $21.0M to $40.0M > $40.0M Your firm charges a premium for a LEED project as opposed to an equivalent conventional project Likert Scale Average

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92 Figure 4 33. Average response based on company annual revenue in relation to LEED premium in the general conditions of the budget Figure 4 34. Average response based on company annual revenue in relation to the eventual standard practice of LEED in the company 0 1 2 3 4 5 6 7 $0 to $20M $21.0M to $40.0M > $40.0M You address the premium charged for LEED projects in the General Conditions of the project budget Likert Scale Average 0 1 2 3 4 5 6 7 $0 to $20M $21.0M to $40.0M > $40.0M Eventually, LEED will become standard practice in my company, and my company will reduce the premium for LEED services Likert Scale Average

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93 Figure 4 35. Average response based on company annual revenue in relation to the LEED risk vs. premium charged Figure 4 36. Average response by LEED & green const ruction percent of annual volume in relation to the first cost still as being a barrier to sustainable design 0 1 2 3 4 5 6 7 $0 to $10M $20.0M to $40.0M > $40.0M If the project has a greater risk, related to LEED, the cost increases in relation to the risk Likert Scale Average 0 1 2 3 4 5 6 7 0% 1% to 45% > 45% First cost is still seen as the single greatest barrier to sustainable design Likert Scale Average

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94 Figure 4 37. Average response by LEED & green construction percent of annual volume in relation to a premium charged for a LEED vs. conventional project Figure 4 38. Average response by LEED & green construction as percent of annual volume in relation to the premium of LEED accounted for in the general conditions of the budget 0 1 2 3 4 5 6 7 0% 1% to 45% > 45% Your firm charges a premium for a LEED project as opposed to an equivalent conventional project Likert Scale Average 0 1 2 3 4 5 6 7 0% 1% to 45% > 45% You address the premium charged for LEED projects in the General Conditions of the project budget Likert Scale Average

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95 Figure 4 39. Average response by LEED & green construction as perce nt of annual volume in relation to the LEED system becoming standard practice Figure 4 40. Average response by LEED & green construction as percent of annual volume in relation to LEED risk and the increase of the premium charged 0 1 2 3 4 5 6 7 0% 1% to 45% > 45% Eventually, LEED will become standard practice in my company, and my company will reduce the premium for LEED services Likert Scale Average 0 1 2 3 4 5 6 7 0% 1% to 45% > 45% If the project has a greater risk, related to LEED, the cost increases in relation to the risk Likert Scale Average

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96 CHAPTER 5 CONCLUSION Summary The results of the study, although limited in quantity, displayed the perspectives of the North Florida construction industry regarding the costs associated with the LEED building rating system and its requirements. The survey developed for this research was used as a means of determining the level of agreement each respondent had with a statement about the costs of a LEED building. The survey was also developed so that the responses of each participant could be separated and analyzed b ased on the research objectives of the study. The objectives were to determine if there was a relationship between the company size, annual revenue, and LEED experience with regards to an additional cost associated with a LEED project. The analysis of th e objectives was limited due to the sample size. Therefore, the relationships between the company size, annual revenue, and LEED project experience was limited to a descriptive analysis of any resulting trends in the relationships. The final analysis of the survey responses produced 40 bar charts for review. The review of the responses involved comparing and analyzing the trends within the levels of agreement in relation to each statement. A review of the analysis reveals that 9 of the 14 questions abo ut cost perceptions revealed a general trend in the responses from all of the study participants. The 5 questions that did not display any trend towards any level of agreement were then separated into categories based on company size, annual revenue, and LEED construction experience. Some of the findings were quite interesting and may help to advance or hinder the movement of the local construction industry towards a more sustainable built environment. Some examples of how the responses may lead to an a dvancement of the local construction industrys level of sustainability are:

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97 The general agreement that the participant promotes the LEED rating system to their clients prospective construction projects. The promotion and educational development of the end user is a key component to the growth of the local sustainable building movement. The majority of responses which were neutral, or unbiased in their opinion, lead to the inclination that LEED projects do not have greater profit margins for the contract or. The neutral majority of responses may indicate that the local contractor will still include the same amount of overhead and profit for a LEED project versus a conventional project. This may keep the overall project costs to a minimum for the enduser further increasing the incentive of an owner to choose LEED as a building standard. The general disagreement of the participants that believe LEED projects have a greater level of financial risk to their company is a promising trend. On the other hand, some of the trends revealed through the analysis of the survey responses may provide a perspective of LEED building costs that could directly hinder the local sustainable construction movement. After reviewing the analyses of the survey responses there w ere six response trends that may hinder the advancement of the LEED rating system within the local construction industry. The six response trends are as follows: The general trend towards disagreement between the respondents about the budget and schedule similarities between LEED and conventional projects indicates the negative perception that the local industry still has towards LEED projects. The perception that materials required for LEED projects are more costly than for conventional projects is a ma jor hurdle which still needs to be addressed within the local construction industry. The general agreement with this statement directly hinders the local industrys ultimate goals for sustainable development. The general belief between three of the survey questions is that LEED projects increase the levels of project documentation, scope, and actual man-hours. The agreeable response to these three statements may lead to the participating contractors inflating their construction price due to the perception s of additional overhead, scope, and time a LEED project may require. The trend to an agreeable response with regard to the actual contract value of a LEED project determining the resulting LEED fee is an indicator of the lack of education the local constr uction industry has regarding the LEED rating system. The advancement and eventual success of the LEED rating system within the local construction industry is contingent upon the opinions of the endusers of the buildings along with

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98 the stakeholders wh ich develop the project from design to final construction close -out. The opinions and perspectives that the local construction industry has towards the LEED rating system is a major hurdle in the advancement of the LEED rating system. In order to reverse the negative perceptions that the local construction industry has toward the LEED system, many suggestions come to mind. The first way to address the negative opinions of LEED would be to educate the stakeholders of the construction industry. The stake holders include the end-user, general contractor, specialty trade contractors, material and equipment suppliers, and designers. An educational system is already in place and readily accessible for the local construction industry. The Builders Association of North Central Florida and the Heart of Florida chapter of the USGBC are located in Gainesville, FL. These membership organizations could develop an outreach program which will facilitate the development and educational awareness of LEED throughout the local construction industry. This program would be able to educate the local industry through presentations by industry leaders and university faculty about the advantages that LEED construction has for all stakeholders. The local construction membershi p organizations have a priceless resource of information through the University of Floridas Office of Sustainability, The M.E. Rinker, Sr. School of Building Constructions faculty, and the other university departments which focus their studies on the sus tainable development of the built environment. One of the goals of the LEED system is to facilitate market transformation. Another way to address and hopefully reverse the opinions of the participants that may hinder the success of the LEED system in th e local construction industry is the adoption of more stringent building codes. The implementation of building codes that correlate with the requirements of the LEED

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99 rating system would make the incentive to register and certify a LEED more attractive. I f the prescriptive performance standards of building systems, materials, and construction methods are required by the City of Gainesville, the supply market will adapt to the needs of the contractors, thereby reducing the initial cost of some of the specia lty materials required by LEED. The transformation of the building requirements and construction practices may lead to an initial cost to all members involved. The initial cost will reduce as the market transforms and will be eliminated when the market t ransformation is complete. The transformation in the market will correspond with the transformation of the local construction industrys perception from a negative to positive view of the relationship between LEED and its associated costs. Overall, the local construction industrys perception of the costs associated with LEED construction is in need of positive reinforcement through education and market transformation. The success of the LEED system in north Florida will be the result of the initiatives if any, that the local membership organizations implement into their program goals. The survey responses lend to the general agreement that there are additional costs incurred by the contractor in the construction of a LEED building. The advancement of the LEED system in the local market must include all stakeholders, and the construction industry is a major stakeholder that needs to be accounted for. Recommendations for Future Study This research study was comprised of only 11 responses from the local construction community. In order to achieve a greater sense of the local constructions perspectives a larger sample is recommended for future variations of this study. The larger sample population may eliminate some of the inability to determine trends in agreement for some of the statements. A variation to this study may involve different regions of the state of Florida and comparing the perspectives region by region. This study focused on north Florida as a region for

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100 survey data collection. A supp lemental study could gather survey responses from central Florida, south Florida, and west Florida. Another variation to this study that may help to determine a more accurate perception, would ask the participant about personal LEED project experience. This study focused on the companys LEED experience that the participant was employed with. Some survey statements relating the individuals LEED project experience would allow the relationships and opinions to be more conclusive. The use of a 7 -point L ikert scale may have limited the ability of the analysis to determine accurate perceptions. The many different types of response categories may have led to a greater chance of variability in the participants responses. A reduction from the 7 -point Liker t scale to a 5 -point Likert scale could allow the respondents to be more separated in their opinions.

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101 APPENDIX A LETTER OF CONSENT

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102 APPENDIX B SURVEY

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103

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104 APPENDIX C CREDIT FIRST COST SU MMARY LEED NC 2.2 Credit Feasibility and Cost Summary (data contributed by Davis Langdon) Key of Cost Increases Reduced Cost 1 Minimal 1 Moderate 2 Substantial 3 Cost Impact If Impact Where? LEED Points Yes No Design Construction Other Soft Sustainable Sites SSPrereq 1 Site Pollution Control 0 x 1 SSCredit 1 Site Selection 1 x SSCredit 2 Density Opt.1 Development / Opt.2 Community Connectivity 1 x 2 to 3 SSCredit 3 Brownfield Redevelopment 1 x SSCredit 4.1 Alt Tran1 Opt.1 1/2 mile rail / Opt.2 1/4 mile bus routes 1 x SSCredit 4.1.E Exemplary Performance Comprehensive Transportation Plan 1 x 1 SSCredit 4.2 Alt Tran2 Opt.1 Comm. Bike racks for 5% and Chang. Rooms for 0.5% 1 x 1 1 SSCredit 4.2 Alt Tran2 Opt.2 Res. Bike racks for 15% occupants x 1 1 SSCredit 4.3.1 Alt Tran3 Opt 1 Provide Vehicles and Parking for 3% FTE 1 x SSCredit 4.3.2 Alt Tran3 Opt 2 Provide parking for 5% of total spaces x SSCredit 4.3.3 Alt Tran3 Opt 3 Install fueling station for 3% of total spaces x 1 1 SSCredit 4.4.1 Alt Tran4 Opt.1 Comercial Minimum and 5% carpooling 1 x 1 1 SSCredit 4.4.2 Alt Tran4 Opt.2 Commercial 5% of 5% pre parking x 1 1 SSCredit 4.4.3 Alt Tran4 Opt.3 Residential Min and share ride program x 1 1 SSCredit 4.4.4 Alt Tran4 Opt.4 All No new parking x 1 1 SSCredit 5.1.1 Habitat Opt.1 Greenfields Protect layout/const. 1 x 1 to 3 1 SSCredit 5.1.2 Habitat Opt.2 Restore 50% of nonfootprint site x 1 to 3 1 SSCredit 5.1.E Exemplary Perf. Protect/Restore 75% of site 1 x 1 to 3 1 SSCredit 5.2.1 Open Space Opt.1 Exceed required local zoning by 25% 1 x 1 to 3

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105 Cost Impact If Impact Where? LEED Points Yes No Design Construction Other Soft SSCredit 5.2.2 Open Space Opt.2 No zoning match footprint with greenspace x 1 to 3 SSCredit 5.2.3 Open Space Opt.3 Zoning with no req provide open space for 20% x 1 to 3 SSCredit 5.2.E Exemplary Perf. Double amount of open space required 1 x 1 to 3 SSCredit 6.1.1.1 Storm Quantity Opt.1 1 Existing<50% then meet existing Reduce Peak Discharge 1 x 1 to 3 1 to 3 SSCredit 6.1.1.2 Storm Quantity Opt.1 2 Existing<50% then protect stream / control runoff x 1 to 3 1 to 3 SSCredit 6.1.2 Storm Quantity Opt.2 Existing>50% decrease by 25% x 1 to 3 1 to 3 SSCredit 6.2 Storm Quality Treat runoff 1 x 1 to 3 1 to 3 SSCredit 7.1.1 Heat Non Roof Opt.1 Shade 50% Hardscape 1 x 1 1 SSCredit 7.1.2 Heat Non Roof Opt.2 50% Parking Space Covered x 1 1 SSCredit 7.1.E Exemplary Perf. 100% nonroof albedo or 100% covered parking 1 x 1 1 SSCredit 7.2.1 Heat Roof Opt.1 Meet SRI for 75% Roof 1 x SSCredit 7.2.2 Heat Roof Opt.2 Green roof for 50% x 3 3 SSCredit 7.2.3 Heat Roof Opt.3 Comb SRI and Green x 3 3 SSCredit 7.2.E Exemplary Perf. 100% Green roof (excluding mechanical/skylights) 1 x 3 3 SSCredit 8 Light Pollution Reduction Combination of Interior and Exterior Controls 1 x 1 1 Water Efficiency WECredit 1.1 Reduce potable use for landscape by 50% 1 x 1 or 1 1 WECredit 1.2.1 Reduce potable use for landscape by 100% Opt.1 greywater/captured water irrigation 1 x 2 3 WECredit 1.2.2 Reduce potable use for landscape by 100% Opt. 2 natural landscape no irrigation (temp allowed) x 1 WECredit 2.1 Innovative Wastewater Opt.1 Reduce potable for use by 50% 1 x WECredit 2.2 Innovative Wastewater Opt.2 Treat 50% waste onsite x 2 2 WECredit 2.E Exemplary Perf. 100% reduction of potable water for sewage or 100% treated onsite 1 x 3 3 WECredit 3.1 Reduce building use of potable by 20% (exclude irrigation) 1 x 1 WECredit 3.2 Reduce building use of potable by 30% (exclude irrigation) 1 x 1

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106 Cost Impact If Impact Where? LEED Points Yes No Design Construction Other Soft WECredit 3.2.E Exemplary Perf. 40% reduction 1 x 1 Energy & Atmosphere EAPrereq 1 Fundamental Commissioning 0 x 1 1 EAPrereq 2 Minimum Energy Performance 0 x EAPrereq 3 CFC Reduction 0 x EACredit 1.1 Option 1 Optimize Energy 10.5% New Building 1 x 0 EACredit 1.2 Optimize E 14% 1 x 0 EACredit 1.3 Optimize E 17.5% 1 x 1 0 EACredit 1.4 Optimize E 21% 1 x 1 EACredit 1.5 Optimize E 24.5% 1 x 2 EACredit 1.6 Optimize E 28% 1 x 2 EACredit 1.7 Optimize E 31.5% 1 x 2 EACredit 1.8 Optimize E 35% 1 x 2 EACredit 1.9 Optimize E 38.5% 1 x 2 EACredit 1.10 Optimize E 42% 1 x 2 EACredit 1.1.2 Option 2 <20,000 SF Comply with AHRAE Small Office Prescriptive 4 x EACredit 1.1.3 Option 3 Comply with Basic Measures 1 x EACredit 2.1 On Site Energy 2.5% (Based on cost) 1 x 3 EACredit 2.2 On Site E 7.5% 1 x 3 EACredit 2.3 On Site E 12.5% 1 x 3 EACredit 3 Enhanced Commissioning 1 x 1 1 EACredit 4 Enhanced Refrig Opt. 1 No refrigerants 1 x 1 1 EACredit 4 Enhanced Refrig Opt. 2 Select non global warming refrigerants per calculations x 1 1 EACredit 5 Measure/Ver. Plan for at least 1 year 1 x 2 3 3 EACredit 6 Green Pwr for at 35% of Electricty for min. of 2 years 1 x 1 EACredit 6.E Exemplary Perf. By doubling % of green power or doubling length of green power contract 1 x 2 Material & Resources MRPrereq 1 Storage Recycle Minimum SF per calcs 0 x MRCredit 1.1 Reuse Maintain 75% of Existing Walls, Floors, Roof 1 x MRCredit 1.2 Reuse Maintain 95% of Existing Walls, Floors, Roof 1 x

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107 Cost Impact If Impact Where? LEED Points Yes No Design Construction Other Soft MRCredit 1.3 Reuse Maintian 50% of Interior Nonstructural elements 1 x MRCredit 2.1 Const Waste Divert 50% from Disposal 1 x 1 to 3 MRCredit 2.2 Const Waste Divert 75% from Disposal 1 x 1 to 3 MRCredit 2.2.E Exemplary Perf. Waste Divert 95% from Disposal 1 x 1 to 3 MRCredit 3.1 Mat. Reuse/Salvage/Refurbished 5% of cost 1 x 3 MRCredit 3.2 Mat. Reuse/Salvage/Refurbished 10% of cost 1 x 3 MRCredit 3.2.E Exemplary Perf. Mat Reuse 15% of cost 1 x 3 MRCredit 4.1 Recycled Material Content 10% 1 x MRCredit 4.2 Recycled Material Content 20% 1 x MRCredit 4.2.E Exemplary Perf. Recycled Material Content 30% or greater 1 x MRCredit 5.1 Regional Material 10% Extracted., Processed., and Manufactured 1 n/a n/a MRCredit 5.2 Regional Material 20% Extracted., Processed., and Manufactured 1 n/a n/a MRCredit 5.2.E Exemplary Perf. Regional Materials exceeds 40% 1 n/a n/a MRCredit 6 Rapidly Renewable Material 2.5% total value mat. 1 x 3 MRCredit 6.E Exemplary Perf. Rapidly Renewable Material exceeds 5% 1 x 3 MRCredit 7 Cert. Wood 50% wood based materials 1 x 1 to 3 MRCredit 7_E Exemplary Perf. Cert. Wood 95% or greater 1 x 1 to 3 Indoor Environmental Quality EQPrereq 1 Minimum Indoor Air Quality Performance ASHRAE 62 0 x EQPrereq 2 ETS Control Opt.1 Prohibit Smoking 0 x EQPrereq 2 ETS Control Opt.2 Designated Smoking Areas 0 x 2 to 3 1 EQPrereq 2 ETS Control Opt.3 Residential Seal Common Areas 0 x 2 to 3 1 EQCredit 1 Outdoor Air Delivery Monitor Opt. 1 Mechanically Ventilated. 1 x 1 1 EQCredit 1 Outdoor Air Delivery Monitor Opt. 2 Natural Ventilated x 1 1 EQCredit 2 Increased Ventilation Opt. 1 Mechical Ventilation increase rates by 30% 1 x 1 EQCredit 2 Increased Ventilation Opt. 2 Natural Vent meet guidelines x 1 EQCredit 3.1 Const. IAQ During 1 x 1 to 2 1

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108 Cost Impact If Impact Where? LEED Points Yes No Design Construction Other Soft EQCredit 3.2.1 Const. IAQ Post Opt. 1a Flush out pre occupancy/post occupancy 1 x 1 EQCredit 3.2.2 Const. IAQ Post Opt. 2 Air testing x 1 EQCredit 4.1 Low E Adhesives SCAQMD 1 x EQCredit 4.2 Low E Paints Green Seal 1 x EQCredit 4.3 Low E Carpet Green Label 1 x EQCredit 4.4 Low E Wood Urea formaldehyde free 1 x EQCredit 5 Source Control Entryways and exhaust 1 x 1 EQCredit 6.1 Control Lights Individual and group spaces 1 x 1 to 3 EQCredit 6.2 Control Thermal Individual and group spaces 1 x 2 to 3 2 to 3 EQCredit 7.1 Thermal Design meet design guidelines 1 x EQCredit 7.2 Thermal Verification survey six to 18 months post occupancy 1 x EQCredit 8.1 Daylight 75% 1 x 1 to 3 EQCredit 8.1.E Exemplary Perf. Daylight 95% or greater 1 x 1 to 3 EQCredit 8.2 Views 90% 1 x 1 to 2 EQCredit 8.2.E Exemplary Perf. Views greater than 90% per case review 1 x 1 to 2 Innovation & Design Process IDCredit 1.1 LEED Innovation Credit 1 IDCredit 1.2 LEED Innovation Credit 1 IDCredit 1.3 LEED Innovation Credit 1 IDCredit 1.4 LEED Innovation Credit 1 IDCredit 2 LEED Accredited Professional 1 Registration & Soft Costs IIRegistration Registration/Certification Members 1 x 1 IV Softcosts Additional Architect/MEP/Design Fee 1 x 1 to 2

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109 LIST OF REFERENCES Alm, A. NEPA: Past, Present, and Future: EPA Journal. January/February 1988. http://www.epa.gov/history/topics/nepa/01.htm Last accessed April, 2009. Amatruda, J., Engli sh, H., et al. GSA LEED Cost Study: Final Report Steven Winter Associates. October 2004. Baum, M., Bouton, D., Sullens, W., Syphers, G. Managing the Cost of Green Buildings. October 2003. Cassidy, R., et al. Green Buildings and the Bottom Line: Building D esign & Construction. November 2006. Finnegan, M., Pickering, C., Burge, P. The sick building syndrome: prevalence studies: British Medical Journal. Volume 289. (p15731575). December 1984. Hedge, A., et al. Work -Related Illness in Offices: A Proposed Mode l of the Sick Building Syndrome: Environmental International. Volume 15. (p143158). 1989. JB. Building Green Pays: Environmental Building News. Issue 12:11. November 1, 2003. www.buildinggreen.com Last accessed April, 2009. JB. Cool Programs at Interface Offset Emissions: Environmental Building News. Issue 12:10. October 1, 2003. www.buildinggreen.com Last accessed April, 2009. Kats, G., et al. The Costs and Financial Benefits of Green Buildings: A Report to Californias Sustainable Building Task Force. October 2003 Morris, P. What Does Green Really Cost? Davis Langdon, PREA Quarterly, Summer 2007 (p55 60). Matthiessen, L.F., Morris, P. Costing Green: A Compr ehensive Cost Database and Budgeting Methodology. Davis Langdon. July 2004. Matthiessen, L.F., Morris, P. Cost of Green Revisited: Reexamining the Feasibility and Cost Impact of Sustainable Design in the Light of Increased Market Adoption. Davis Langdon. July 2007. Myers, D. A review of construction companies attitudes to sustainability: Construction Management & Economics. October 2005. Issue 23. (p781785). Peterson, K. Achieving Energy Efficiency in the Built Environment through Standards. December 6, 2007. www.engineeringforsustainability.org/docs/energyefficiencyinbuiltenv.pdf Last accessed April, 2009. Suttell, R. The Trus Costs of Building Green: Buildings Magazine. April 2006. Issue 4. (p4648).

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110 Turner Construction Company: 2008 Green Building Market Barometer www.turnerconstruction.com/greenbuildings Last accessed April, 2009. United States Environmental Protection Agency. Indoor Air Facts No. 4(revised): Sick Building Syndrome. February 1991. www.epa.gov. Last accessed April, 2009. Wilson, A. Biophilia in Practice: Buildings that Connect People with Nature: E nvironmental Building News. Issue 15:7. July 1, 2006. Wilson, A. Interview with Bill Bowie. C Change Radio. www.buildinggreen.com/live/ind ex.cfm/2009/3/16/Interview -with a green -building movement pioneer Last accessed April, 2009. World Commission on Environment and Development. Our common future (aka The Bruntland Report). Oxford, England: Oxford University Press. 1987.

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111 BIOGRAPHICAL SKETCH Mathew R. Forenza was born in San Francisco, California, to Arthur J. Forenza, Jr. and Kandis S. Forenza. Mathews development as a student and a person can be attributed to the many different regions of the US he has lived. Since elementary scho ol Mathew has lived in California, New Jersey, South Carolina, and currently lives in Gainesville, Florida. Mathew gained a respect for the environment through his parents devotion to education about the environment and his surroundings. Upon graduating high school in 2003, Mathew attended the University of Florida where he earned his Bachelor of Science in Building Construction degree. During Mathews first upper classman year in the M.E. Rinker, Sr. School of Building Constructi on he chose to enroll i nto the combined bachelor/master degree program. This program enabled Mathew to earn his Master of Science in Building Construction in just one year. Mathew plans to establish himself in the construction industry with a reputable construction company. F uture plans for Mathew may entail a return to academia to pursue teaching the new generation of construction management professionals.