CREJ

Page 2 — Office Properties Quarterly — March 2020 www.crej.com Contents Letter from the Editor C hange is coming in Colorado,” Mohit Mehta with ME Engi- neers told the audience at the Colorado Real Estate Journal’s property management confer- ence.With the passage of House Bill 19-1261, which outlines Colorado’s climate action plan, buildings are going to be a big part of that conversation. And for good reason – buildings are responsible for 44.6% of the U.S. carbon dioxide emissions. In Colorado, build- ings are responsible for 57% of the emis- sions, he said. “It’s not going to be optional pretty soon,” he said. He cautioned the audience that it would be smart to start planning for it now. “Until pretty recently, many people thought it was a choice. It’s no longer a choice.” These changes will impact new and existing office properties across the state. In the past fewmonths, a couple of pieces of news showcased that the state is on the right track. First, Colo- rado was ranked No. 1 in the U.S. for LEED Green Buildings, according to the U.S. Green Building Council, which ranked states based on the number of LEED certified square feet per person. In 2019, Colorado saw 102 projects earn LEED certification. Second, a CBRE study found that Denver offices were getting greener – 48.2% of the city’s office space is certified green, placing Denver eighth among the 30 largest U.S. office mar- kets. To build on this momentum, Denver will be tackling new and existing build- ings’ carbon emissions in a variety of ways, as set out by the 80x50 Climate Action Plan. By 2035, all new buildings in Denver must be net zero, which gives the city five code cycles to get there, Mehta said. Boulder announced an even more aggressive plan – a net zero baseline energy code for all new buildings by 2031. For existing office buildings, the Energize Denver program is leading the charge – with the goal to reduce energy by 50% in all existing buildings by 2050. As the first step, all office properties in the city 25,000 square feet or larger are required to annually assess and report their energy performance using Energy Star Portfolio Manager. Currently, 95% of buildings are in compliance with the benchmarking requirement. In recent issues, we’ve touched on new regulations regarding buildings and sustainability. In this issue, on Page 19, Francis McGarey explains building commissioning, which is now a mandatory component for all Denver projects. In the most recent issue of Property Management Quarterly, Paul Kriescher wrote about air-tightness testing, which is now a Denver require- ments as well. While these requirements may bring about more work on the development and management side of office real estate, the goals seem to be supported by its residents. A survey of 1,7000 Denver citizens found that 90% believe the city should take aggressive action to address climate change, Mehta said. Michelle Z. Askeland maskeland@crej.com 303-623-1148, Ext.104 Energy goals for offices 4 6 7 8 10 11 12 13 14 15 19 26 2020 vision: Economic forecast for metro Denver Patricia Silverstein Rising construction costs impact capital markets Jeff Wood Rapidly increasing tax assessments hit real estate Darrin Revious 2019 NAIOP Colorado Awards of Achievement Denver gets boost from jump in private businesses Katherine Gustafson 5 commercial real estate trends to watch in 2020 Andy Cullen Technology sector influences creative office space Jamie Gard Designer insights: Creating shared amenities Kristen Tonsager Open offices require thoughtful implementation Michele Forrest and Megan Ellis ULI Colorado District Council Spotlight Building commissioning in Denver is here to stay Francis McGarey Who's News NICK PAVLAKOVICH 303.813.6438 nick.pavlakovich@cushwake.com MATT GAUTREAU 303.813.6424 matt.gautreau@cushwake.com 5 F U L L F L O O R S R E M A I N I N G “