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Dear Friend:

I don't know about you but it seems that everywhere I turn these days, I'm noticing a movement toward "green." Cars are hybrids, cereal boxes promote that their packaging is "green friendly," software companies are promoting "green computing strategies" -- the list goes on and on. Specific to the construction industry, "green" companies are popping up all over the U.S. promoting their "green building" expertise (see Boston Building Green).

Is this "going green" here to stay or as much of a fad as "pet rocks" were in the 1970s? In this month's BBI, we hope to bring you up-to-date on green building -– what it is, what's the market interest, and what it means to be a green builder. And, we provide over five tips on how you can give your business a competitive edge by offering green business practices.

Walt Stoeppelwerth
HomeTech Building Business Ideas

P.S. Registration is still open for the November 14th HomeTech ADVANTAGE Advanced Seminar. Attend this full-day seminar for in-depth training on how to create estimates using HomeTech ADVANTAGE. The afternoon will focus on exploring advanced features including modifying estimates, and using the Assemblies feature. Click here for more information and to register for this event.

Walt Stoeppelwerth

 

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Step-by-Step Guide to the Fundamentals of Selling

To be successful in today's remodeling field, you must not only be a good craftsman, you must be a good salesman as well. In this 298-page book, Mike Gorman will show you step-by-step how the highly acclaimed "Consultive Selling Process" works. Click here for more.

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Is Green Building Here to Stay?
It appears that the momentum of green building, both in residential and commercial markets, is gaining momentum. But exactly, what does green building mean? And, is green building sustainable?

Green building defined
The basic idea for green building is to reduce energy and material consumption when either constructing or rehabbing a building. Worldwide, buildings account for 17% of fresh water withdrawals, 25% of wood harvest, 33% of CO2 emissions and 40% of material and energy use. The U.S. Green Building Council (USGBC) developed a rating system to determine green building effectiveness. Commonly referred to as the LEED (Leadership in Energy and Environment Design) system, the USGBC determines a LEED rating based on five primary areas:

1. Material use: recycled content, use of alternative materials, occupant recycling
2. Energy: ozone protection, renewable energy
3. Water management: water use reduction, water discharge compliance
4. Site planning: reduced site disturbance, storm water management
5. Indoor environmental quality: asbestos/PCB removal, green cleaning, thermal comfort
   

According to the USGBC, green building is not just a fad, but a growing trend. Their research has found that 89% of the next generation of the population will choose brands aligned with a social cause. And, with green building promoting energy conservation, it is a pretty sound social cause. The USGBC also estimates that a $10 billion market (in 2005) will grow to a $60 billion market by 2010. And, while the majority of green building efforts initially occurred in the commercial sector, the greatest growth leading up to 2010 will be in the residential sector.

Is there a green building opportunity?
Green building was initially introduced in the commercial sector. While the perceived benefits of improved comfort, reduction in operating costs for building owners and increased lease rates might help create demand for commercial green buildings, construction costs for building green can range 0.66% to 6.8% more than for non-green buildings.

In the residential sector, the USGBC is now conducting a pilot program for a residential LEED rating system (results due out before the end of the year.) Even so, the LEED rating is focused on homes that are in the top 25% of the market, leaving some to wonder how great an impact the LEED ratings will have on the residential sector overall.

How can you embrace green building?
For some of you, green building might be the business opportunity of a lifetime. Becoming the premiere "green builder" in your area could bring you projects that you would have otherwise missed. Promoting green building practices and becoming a LEED accredited professional might differentiate your business from others and allow you to take advantage of any opportunities that might arise as the demand for green building grows. But, if you don't want to go full-force green, you could leave the choice to build green up to your customers and support the green building efforts they are willing to invest in.

Some specific green choices that you could offer for any new construction or remodeling project include:

• Consult with your clients on what it means to build green.
• Encourage your clients to buy Energy STAR appliances for a kitchen remodel for example.
• Use rapidly renewable floor materials as an alternative to wood: bamboo, cork eucalyptus, and linoleum.
• Construct cabinetry out of wood alternatives or FSC-certified materials.
• Offer locally produced products as an alternative; locally produced woods reduce emissions in the transportation of these products.
• Suggest products that don't give off "volatile organic compounds". Check paint labels for the "VOC" percent.
• Encourage clients to install programmable thermostats and use only fluorescent lighting.
• Recommend that your clients plug all leaks; windows and doors are notorious areas where leaks occur.
• Offer services to tune and clean-out HVAC systems.
  

While some of these green building suggestions will not appeal to home buyers when either building a new home or renovating an existing one, comparing the benefits realized when using green materials will certainly help sway some decisions. By undergoing a green building project, homeowners can expect their home to now use less energy, water and natural resources, and might also find that their home now provides a healthier living environment.

Most likely, in short order, green building will not become the only choice. Being able to offer green building alternatives now, however, is probably a smart decision and one that can help you differentiate yourself in a competitive field.

Note: Many of the statistics in this article were found on the U.S. Green Building Council's web site at http://www.usgbc.org.

For some of you, green building might be the business opportunity of a lifetime.

 

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Want to understand more about the LEED rating system? Review the LEED for Existing Buildings FAQs to find out more.
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Additional Resources

BuildingGreen.com

National Resource Defense Council (NRDC)

U.S. Green Building Council

Green Building: What we have learned about costs, savings and value, Environmental Design + Construction

Update Your LAMI in 6 Simple Steps

Our Local Area Modification Index (LAMI) cost databases are what make HomeTech ADVANTAGE different from all other estimating packages. With over 14,000 items in the LAMI databases, all of these costs are updated on a quarterly basis and are available for download directly into your HomeTech ADVANTAGE system. Click here for six simple steps on how to update your HomeTech ADVANTAGE LAMI database.

Read more on this month's tip »

The remodeling market's growth in recent years has been largely driven by a relatively small number of homeowners. In 1999, the top 5% of spenders accounted for 50.4% of remodeling activity. That percentage has been rising consistently -- by 2005 the top 5% accounted for more than 60% of expenditures.

The Leading Indicator of Remodeling Activity (LIRA) is currently projecting a decline in total remodeling spending through the first quarter of 2008. If accurate, remodeling spending will be about 5% lower on an annualized basis in the first quarter than the all-time high reached in the third quarter of 2006 -- but still higher than any period prior to the 1st quarter of 2006.

Source:
Harvard University, Joint Center for Housing Studies, October 2007

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