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Sustainable Building Certification and the Rent Premium: A Panel Data Approach

Author

Listed:
  • Alexander Reichardt

    (EBS Universität für Wirtschaft und Recht i. Gr)

  • Franz Fuerst

    (University of Reading Whiteknights)

  • Nico B. Rottke

    (EBS Universität für Wirtschaft und Recht i. Gr.)

  • Joachim Zietz

    (EBS Universität für Wirtschaft und Recht i. Gr.)

Abstract

This paper investigates whether obtaining sustainable building certification entails a rental premium for commercial office buildings and tracks its development over time. To this aim, both a difference-in-differences and a fixed-effects model approach are applied to a large panel dataset of U.S. office buildings in the period 2000-2010. The results indicate a significant rental premium for both Energy Star and LEED certified buildings. Controlling for confounding factors, this premium is shown to have increased steadily from 2006-2008, followed by a moderate decline in the subsequent periods. The results also show a significant positive relationship between Energy Star labeling and building occupancy rates.

Suggested Citation

  • Alexander Reichardt & Franz Fuerst & Nico B. Rottke & Joachim Zietz, 2012. "Sustainable Building Certification and the Rent Premium: A Panel Data Approach," Journal of Real Estate Research, American Real Estate Society, vol. 34(1), pages 99-126.
    • Handle: RePEc:jre:issued:v:34:n:1:2012:p:99-126
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    More about this item

    JEL classification:

    • L85 - Industrial Organization - - Industry Studies: Services - - - Real Estate Services

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