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January 2017 — Property Management Quarterly — Page 11
D ynamic property managers
are the ones who can iden-
tify unique opportunities to
reduce the owner’s bottom
line while simultaneously
giving tenants good reasons to stay.
Hidden in the shadows of opportu-
nities to greatly reduce costs while
beautifying a property lies light-
emitting diode lighting conversion.
Right now, and it won’t last forever,
changing out incandescent and com-
pact fluorescent lamp bulbs to LED is
an overlooked investment opportu-
nity that accomplishes those hard to
find opportunities. In fact, the incen-
tives offered by energy companies to
make the move to LED are so profit-
able that some tenants are choosing
to split or cover the entire cost of the
conversion.
Managed properties have an
available operating budget, which
often includes working capital for
improvements and deferred main-
tenance. LED doesn’t just reduce
an energy bill after you put it in. It
has an impact on line items in the
budget, which include hundreds,
sometimes thousands of purchased
light bulbs and labor costs to replace
burnt-out bulbs with other low-effi-
ciency bulb that will burn out again
in a few years. I have dug into those
expenses for large facilities and just
those replacement costs, excluding
the energy consumption cost, can
run into the tens of thousands per
year.
Current efficient LED bulbs can last
at least 50,000 hours and some are
improving to 100,00 hours. On a con-
servative average use that is 20 years.
The budgetary line items containing
those costs are not just reduced but
virtually eliminated, immediately
increasing the cash flow of the prop-
erty. LED also puts off significantly
less heat, and since heating costs
much less than cooling, the energy
savings extends to the reduced cost
of air-conditioning in the warmer
months. You will be green not just
from a sustainability standpoint, but
also from a cash point of view.
LED is the most practical, eco-
nomical, efficient and longest-lasting
manmade light. You do not have to
take my word for it, but I can give
you some pretty good indicators that
LED is here to stay. Union Station,
Colorado Convention Center, Denver
Pavilions and Denver International
Airport are just a few examples of
local facilities that are making the
move to LED and benefiting from the
available rebates and energy savings.
Right now energy companies cou-
pled with sustainability initiatives
are mandated to financially incentiv-
ize properties make the transition
to LED. We are being pushed by “the
powers that be” to change all our
lights to LED. The push comes with
free money in the form of rebates.
Once enough properties move to
LED, these compelling incentives
will cease to exist. If you are going to
make the move to LED, I would rec-
ommend letting Xcel and our other
public and private partnerships help
you pay for it now.
The incentives that are avail-
able are not just a little bit of free
money. We are seeing rebate checks
back to companies that choose to
change out their lighting to LED up
47 percent of gross project costs.
When designed correctly, we see
return on investments of as little
as 1.04 years and continuous sav-
ings of 50 percent less on the cost
of lighting energy. This real money
goes straight back into the pockets
of the facility own-
ers or tenants.
An LED upgrade
does not have to
be part of a larger
remodel and, with
the right partner,
can be done quickly
and effortlessly.
There is quite a
bit of research on
which color tem-
perature and color
rendering is best
for different areas
and rooms. An LED expert can make
sure you are getting the right light
for each application. It may be help-
ful to know LED can be added to a
refurbish project as a trigger point
if a certain return on investment is
required for various sustainability
financing, such as Commercial Prop-
erty Assessed Clean Energy.
Striking the balance between cost
and value, the time really is right
now. I have been in this industry for
a long time, and I am clear we’ve
reached a perfect trifecta of a stable
technology, an active rebate program
that will only be around a limited
time, and significant energy savings
realized immediately. This is one of
those decisions where the interest of
all parties can align and it can be an
easy win for the owner, the property
manager and the tenant. I am con-
fident that if you take a closer look,
it won’t be hard to illuminate others
about this opportunity. I highly rec-
ommend getting a lighting assess-
ment to put you on the path to a
brighter future.s
Sustainability
Erik Myklebust
President, IES
Distributors,
Denver
Union Station, Colorado Convention
Center, Denver Pavilions and Denver
International Airport are just a few examples
of local facilities that are making the move
to LED and benefiting from the available
rebates and energy savings.