Before the financial crash of October 2008, green buildings were the darling of the media and the market, and nowhere was that more true than in B.C.
Victoria’s Dockside Green promised to be the first LEED (Leadership in Energy and Environmental Design) platinum-ranked community in the world; the Millennium Water project proposed to turn the derelict industrial lands of southeast False Creek into a shining example of sustainable design and new urbanism; and PR companies across the province stoked our green-building fever with an impressive barrage of eco-hyperbole.
They pitched a heady cocktail of consumerism and environmentalism, promising us the opportunity to find Mother Nature – and indeed our own souls – on the verdant balcony of a luxury condominium.
But that was all before Black October. Since then the construction and real estate industries in B.C. (and around the world) have been in a tailspin. Average residential real estate prices in Metro Vancouver dropped 11 per cent between January 2008 and January 2009, with the total number of sales declining to levels not seen since the early 1980s. The value of building permits issued across the province slid 32.6 per cent in November 2008 compared to a year earlier, with the residential portion of those permits diving 47.3 per cent.
As if to highlight the woes of the once-mighty construction industry, development giant Onni Group of Companies held a massive liquidation sale in January and February of this year, off-loading 396 Lower Mainland condos and townhomes at discounts averaging 30 to 35 per cent. It was a sharp descent from the glory days of bidding wars and presale sellouts that had been commonplace just a year earlier.
So where does that leave green building? Will it shrivel and die along with our once-hearty appetites for premium-priced condos within walking distance of the local yoga studio? Or will it survive this recession and emerge all the stronger when the economic clouds finally break? The answer, as with so many things, depends a lot on perspective.
Norm Couttie is the president of Adera Development Corp., B.C.’s largest builder of homes certified by the Built Green criteria (see sidebar p. 70). Adera has focused on building green for the past half-dozen years, but Couttie claims the rationale has more to do with ethics than it does with finances. Referring to green features in the homes Adera builds, he says, “We’ve never charged a premium, and people have never been all that willing to pay for them.”
In fact, he says, Adera’s commitment to building green often costs the company hundreds of thousands of dollars on a multimillion-dollar project. “We do it because, one, it’s the right thing to do and, two, we’re going there anyway, so why not be a leader rather than a follower?”
Not that he expects many followers these days. “When the economy was doing well, people were more interested in copying us. But I have a feeling that some of them are backing off now.”
Peter Simpson, CEO of the Greater Vancouver Home Builders’ Association, notes that there’s little consumer demand to drive any sustained surge in green residential development. “There was never an overwhelming number of people who were willing to pay a premium for a green home,” he says. Even when the real estate market was hot, new homebuyers almost always chose esthetic upgrades over green ones. “Granite wins over green every time,” he says, referring to our collective love of genuine stone countertops.
To underscore his point, Simpson recalls a trip he made to the Pacific Coast Builders Conference in June 2008. Although Canada’s real estate industry was still buoyant at the time, the conference was held in the U.S., where there was already a severe decline in real estate values.
“There were two concurrent seminars running across the hall from each other. One was called Where Do We Go From Here? and it was all about the state of the economy. The other was about green building. It was standing room only in the first, but you could have shot a cannon through the green-building seminar without hitting anyone.” The fact is, he says, “when it comes to choosing survival or green building, builders will choose survival every time.”
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Given that both Simpson and Couttie are big supporters of green building, one might take their relative pessimism as a sign that the modern sustainable building movement is heading for the trash heap of history, along with the short-lived energy efficiency movement of the 1970s. Neither Simpson nor Couttie would be inclined to agree, however. They see the current downturn as just one more step on a continuum moving steadily toward ever-greener homes. “The industry has adapted faster than I thought it would,” says Couttie. “I don’t think we’re going to stop, and we’ll just keep getting better and better at this.”
One reason for such optimism in the face of an economic meltdown can be found in additions to the B.C. Building Code and the Vancouver Building By-law, both of which took effect in 2008. The B.C. code now mandates better insulation and water-saving features such as ultra-low-flow toilets in all new homes. The Vancouver bylaw takes it many steps further by calling for dual-flush toilets, heat-recovery ventilators, digital displays of real-time energy usage and cost, and future-friendly additions such as the infrastructure to recharge the electric cars of tomorrow and prepiping for roof-mounted solar energy generation. While consumers may still opt for hardwood floors and pass on recycled strawboard kitchen cabinets, government is stepping in and making sure that all new construction meets a higher standard of energy and water efficiency.
Perhaps to take the sting out of such eco-paternalism, various levels of government across B.C. are setting the bar even higher for themselves. The provincial government, the City of Vancouver and no fewer than eight other municipal governments have all stipulated that any new government buildings must meet LEED standards. In the case of the province and the City of Vancouver, LEED gold is the minimum standard – a certification level that has so far only been achieved by 60 buildings in all of Canada.
According to Brenda Martens, co-founder of the Vancouver green-building consulting firm Recollective, government has long been the one pushing the envelope. “The province was one of the first adopters of green building, and Metro Vancouver was another early adopter. The private sector has followed them in order to remain competitive.”
This level of government involvement has been a good thing for companies such as Recollective, providing them with a bit of a cushion during recessionary times. “We’ve experienced the same downturn as everyone else,” Martens says, “except that it hasn’t been as bad for us.”
Because governments have mandated LEED standards for themselves, any government buildings necessarily flow through a company like hers. “In that sense, we’ll do better than our non-green counterparts in this industry.” What’s more, many of the private green-building projects already underway have agreed to LEED certification in exchange for some kind of relaxation of municipal development constraints. “So most of them are bound to remain green,” says Martens. As for new projects, she is less optimistic, and Recollective has already had future projects either put on hold or cancelled outright.
While no one seems to doubt that the total number of green-building projects breaking ground in the next year or two will be lower than in the previous few years – and that companies such as Recollective and Adera will suffer as a result – there may nevertheless be room for optimism about green building’s future.
Helen Goodland is the executive director of the Light House Sustainable Building Centre, a Vancouver-based non-profit society that acts as a hub for a wide range of information and services related to green building. Light House provides quarterly market analysis of green-building trends, and Goodland is telling builders that green building makes more sense now than ever. “It’s more of a buyers’ market than it was. So buyers are now able to make a selection between green – which is frankly synonymous with higher quality – and non-green. The end result is that non-green builders will be out of luck.”
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Following the logic of Martens and Goodland, it will be the green builders who emerge less weakened from this recession than their non-green counterparts. And when the market rebounds, those green builders left standing will have an even greater influence over the industry as a whole.
That may be a bit too glass-half-full for the skeptics out there, but even the most jaded meat-and-potatoes builder would agree that there is one area where green building will get a boost during this recession: the green retrofit, that decidedly unglamorous world of boiler upgrades, window replacements and weather-stripping. It may lack the flash and pizzazz of projects such as Millennium Water and Dockside Green, but what green retrofits lack in glamour they make up for in government support.
In its January budget, the federal government earmarked $300 million in extra funding over two years for the existing ecoEnergy retrofit program – enough to subsidize an additional 200,000 residential energy efficiency renovations. It will also invest $1 billion over two years for renovations and energy retrofits for up to 200,000 social housing units, plus another $1 billion over five years to support the Green Infrastructure Fund.
While such funding may be a step in the right direction (and will certainly contribute to job creation), green-building advocates such as Goodland believe that the federal government has not gone far enough. “There’s still this distinction between infrastructure and green infrastructure,” says Goodland, “and there shouldn’t be. There shouldn’t be any other kind of infrastructure besides green infrastructure.” And while she commends the government of B.C. for the recent additions to the building code, her congratulations are also somewhat reserved.
“B.C. is certainly at the leading edge of jurisdictions in North America, but line it up with anything in Europe and we just pale in comparison. We have a lot of work to do to catch up to places like the U.K.” Besides, she adds, “building codes are the line below which you’re illegal; they’re not meant to be an aspirational standard.”
But despite her disappointment in various governments’ missed opportunities, Goodland believes that the overall trend toward green building is “inexorable.” And she is hopeful that B.C. will play a pivotal role in driving the green-building movement forward, benefiting from the economic gains that will inevitably flow toward leaders in the field. “British Columbia has the potential: it has some of the world-leading green-building designers, architects and technologies. But if we wait and become a follower instead, we could be facing a very expensive future.”
So where does that leave B.C.’s green-building industry now? On one hand, we can pat ourselves on the back for having more LEED-certified buildings than any other province besides Ontario (they have 51; we have 40) and for implementing some of the greenest building codes in North America.
Green builders across the province can take heart that this recession will not be the death of the green building movement and in fact may provide a kind of backhanded boost that will allow green building to flourish when the economy rebounds. On the other hand, even if green building does make it through the next few years, it still has a long way to go.
The general public may have discarded the notion that green building is only for Gulf Island hippies, but that doesn’t mean we can rest on our collective laurels. B.C.’s buildings are better than they were five years ago, and thankfully they show no signs of backsliding any time soon. But is that good enough? For people such as Helen Goodland and Brenda Martens, the answer is a resounding no.
