The Related Companies, which owns Time Warner Center and 26,000 apartments across the country, expects a few years of economic uncertainty and plans to respond by cutting long-term energy costs.
At a discussion on green building last night, Related executive Jeffrey Brodsky said a national recession could sap rental income while rising oil prices inflate energy bills. So Related plans to generate electricity on-site at some properties while enlisting property managers to figure out other ways to avoid waste.
Speaking before the United States Green Building Council’ local chapter, Brodsky outlined plans for big changes in Related’s approach to existing buildings. While the company has sought to showcase energy efficiency in new projects, he said, it will hunt more aggressively for savings in older properties.
He said that long-term concerns about oil-price manipulation and global political risk “mean that even with a cap on growth in rents, we’ll be looking at significantly increased energy costs.”
So Related plans to fine-tune its portfolio. Brodsky said that the company plans to pursue a co-generation plant at one of its Manhattan properties “within the next thirty days.” Co-generation — when a building uses a small power plant to produce and consume exactly as much electricity as it needs — also figures in Related’s proposal for developing the Hudson Yards.
Spokeswoman Joanna Rose said that it would be “premature” to discuss the co-generation plans before permits clear.
Related’s moves sync with Mayor Michael Bloomberg’s PlaNYC agenda, a 127-point program that aims to reduce greenhouse-gas emissions from buildings by 30 percent over the next 22 years. Today’s buildings will make up 85 percent of the city’s buildings in 2030, so emissions cuts will require retrofits and new technologies at existing sites.
While some real estate executives have called Bloomberg’s energy agenda too aggressive for landlords to manage, Brodsky said retrofitting could look more attractive as the pace of rental growth slows.
“There’s been resistance to greening existing office buildings because a building’s energy savings go to the tenant,” he said, “but when tenants are worried about pass-through costs, tenants will be able to work in alignment with owners.”
Brodsky also said that Related would move to save energy nationwide by training employees to be more energy efficient. The company will rework its list of cleaning supply products to screen out toxic or environmentally unfriendly products.