The Business Case for Resilient Buildings

The Miami-Dade County building code requires commercial buildings to enclose their first 30 feet in impact-resistant glass so as to withstand damage from high winds and flying objects during a hurricane.

The developers of Miami’s 1450 Brickell office tower decided to go one better, enclosing the entire 35-story building in impact-resistant glass. According to a 2015 report from the Urban Land Institute, when the tower was finished in 2010, it had “the strongest curtain wall window system of any commercial building in the nation.”

That extra level of precaution didn’t just make for a safer structure. It also provided a boost to the building’s bottom line, says Sarene Marshall, executive director of the ULI Center for Sustainability and an author on the report.

“That building leased twice as fast as its competitor buildings that were going up at the same time,” she says.

Not only that, but the development was able to draw a number of “highly sought-after tenants,” notes CBRE’s director of research and analysis for the state of Florida, Quinn Eddins, who authored a recent report looking at the business case for resilient buildings.

In particular, 1450 Brickell attracted “global financial institutions for whom continuity of operations is very important,” he says. “I believe that property was nearly fully leased at a time when other buildings finished around the same time were still 40 percent leased.”

Concern is growing around the world about issues like climate change and rising sea levels, and with hurricane season approaching, the notion of resilient building is especially relevant, particularly in areas most likely to be affected. It’s a trend that’s on the rise, Eddins says, as developers are realizing it’s not just a necessary safeguard, but also a potential business advantage.

Due to its hurricane history, the Miami area has long prioritized resilience in its buildings. But recent weather events, most notably Hurricane Sandy, which in 2012 devastated large portions of the New York-New Jersey region, have generated interest in resilient building in other parts of the country, says ULI’s Marshall.

“Some very high-profile events have happened in key places in the world, mainly New York City with Superstorm Sandy, that I think have catapulted the issue of resilience onto the radar of many people in the real estate industry,” she says. “You see a major real estate market being really decimated by an event like that, and you go, ‘Hmmm, I wonder what might happen to us.'”

And, as the example of 1450 Brickell shows, by protecting their investments, developers are also making them more valuable. Money spent on upping a project’s resilience can come back to property owners in a variety of ways, Marshall notes.

Resilient buildings can reduce operating expenses due to features like improved insulation and more efficient energy systems. Such buildings can also enjoy lower insurance costs, Marshall says. And, in the case of a major hurricane or other event, recovery can be faster and cheaper than in a less resilient building.

Looking forward, developers are trying a number of new approaches to increasing their building’s resilience. Some of the most interesting, Eddins says, focus less on fighting the winds and flooding associated with hurricanes and other extreme weather, and more on accommodating them.

“One of the coolest things I have seen is the floodable first floor,” he says. “The idea that you build your first floor so that in severe storms you will get flooded. So you put vital building systems on higher floors, less carpet on the first floor, more tile and concrete.”

Another similar notion involves an increased emphasis on the design of building sites, Eddins adds.

“You see sites designed so that the water has places to go,” he says. “So, building to accommodate the water, not just repel it.”

If you can’t beat them, join them, in other words. And maybe make a little extra money doing it.