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Monday, June 21, 2010
Companies Factor in LEED
By Richard Metcalf
Of the Journal
LEED certification hasn't lost allure despite the sluggish economy and all its attendant ills.
Miller Bonded, a locally owned mechanical contractor, is going for gold certification of its 16,000-square-foot pipe fabrication shop and warehouse in the North I-25 corridor. Likewise with locally owned Queston Construction, which is seeking silver certification of its planned 6,696-square-foot office and warehouse in the North Valley.
And Molina Healthcare has gotten final gold certification of its 26,170-square-foot data center at Mesa del Sol through the U.S. Green Building Council's Leadership in Energy and Environmental Design program. Featuring a rating system and third-party verification, LEED sets the standard for the energy efficient and environmentally friendly construction and renovation of buildings.
Molina's gold is especially noteworthy because energy savings are a challenge in the climate-controlled environment of a data center packed with computer servers, said Chris Wilson of St. Louis, Mo.-based Arco National Construction Co., the building's general contractor.
"This is probably the hardest building type to get the certification," he said.
The data center, which has been open for a year or so, is saving about $100,000 a year on utility bills through a myriad of energy-saving steps, said Joe Layman, who was hired locally as the data center manager. In four years, the annual savings will pay back the additional cost of LEED certification, he said.
"One of the things I enjoy is that any money we save goes back to helping our members," he said.
Long Beach, Calif.-based Molina primarily administers Medicare and Medicaid health care plans, currently with about 1.5 million members, in 10 states including New Mexico. It has about 92,000 members here. The data center houses all of the company's data functions, including 1,000 servers.
At Miller Bonded, which has 175 employees in Albuquerque and Glendale, Ariz., president Ken Otteni said, "We're seeing more and more private and public projects going through with LEED certification. It's the right thing to do."
When plans were being drawn up a year ago with NCA Architects-Planners, the pipe fabrication shop had a green design but wasn't lined up for certification, said company CEO Keith Wilson. When the design was compared to LEED criteria, he said the building met the specifications for silver certification. The decision was made to adjust the plans and go for gold certification.
"It became a no-brainer at that point," Wilson said. "We were committed to doing those things anyway."
The design emphasizes air quality and required the purchase of new welding equipment with low gas emissions as well as a recirculating air filtration system. The result will be a healthier work environment for employees and no untreated exhaust released into the neighborhood, Otteni said.
Solar panels on the rooftop will generate power to provide hot water for the building, including its radiant floor heating system. The panels will provide about 10 percent of the building's energy, said Bill Chandler, who is Miller Bonded's LEED expert.
As would be expected with gold certification, the building will be loaded with green elements. The additional cost to achieve gold is 10-15 percent of the total $1.6 million project cost, which will be at least partially offset by state incentives like the Sustainable Building Tax Credit and Solar Market Development Tax Credit, Otteni said.
The building at 4420 McLeod NE is expected to be ready for production by January, allowing for the expansion of the sheet-metal shop and tool storage in the existing 20,000-square-foot office, shop and warehouse next door at 4538 McLeod, Wilson said.
For Queston Construction, construction of its own building coincides with the company's 20th anniversary. Currently with 32 employees, Queston does roofing and general contracting on projects ranging from residential to industrial all over the state.
The $400,000 building will go up on a 0.7-acre lot that has an address of 2212 4th NW, but is actually on the frontage road on the north side of Interstate 40, said president and CEO Tina Cordova. "This is a premier location for us," she said. "There's huge visibility here."
The goal is for silver certification through the LEED program. The green design incorporates solar panels, wind turbine, used and recycled construction material and "as many of these types of features as possible," she said. The project is being financed by a Small Business Administration guaranteed loan through First Community Bank.
The building will have amenities that the Queston staff has wanted for years, such as a locker room with showers, full kitchen in the break room and a children's play room, Cordova said. The exterior will be dressed up with architectural metal wall panels.
CB adds brokerage
CB Richard Ellis has become what is likely the first local commercial real estate services firm to set up a mortgage brokerage arm.
Albuquerque native Peter Gineris, who previously worked for Charter Bank and Sunrise Mortgage & Investment, will head the local office of Los Angeles-based CB Richard Ellis' Capital Markets Group. In the past, the Albuquerque office had debt and equity financing available through the company's offices in Denver and Phoenix.
"This model has been the norm for CBRE's larger offices," said Jim Chynoweth, managing partner of the Albuquerque office. "It's something that we feel makes sense for the Albuquerque office at this time."
The addition of a mortgage brokerage would probably have happened sooner if CB Richard Ellis' local office had been corporate owned from the start, he said. The local office operated as a franchise for nine years before going corporate in early 2008, just as a slowdown in commercial real estate activity was taking hold.
Investor interest in buying commercial properties has been picking up, Chynoweth said, adding, "We're even getting some deals done."
The Capital Markets Group is geared to investment purchases, rather than so-called "owner/user" purchases where a company buys its own building to occupy. As elsewhere in the CB Richard Ellis network, the local capital markets office is a separate business line from the real estate brokerage. As a result, it isn't restricted to just CB Richard Ellis deals.
"Other brokerages could be associated with the transaction," he said. "Where appropriate, there's information sharing."
The Albuquerque office also has its own in-house appraiser, Andrea Applegate, who can tap into the CB Richard Ellis database of deals for up-to-date "comps" or comparable sales in property type and size.
Richard Metcalf covers commercial real estate for the Journal. You may reach him at 823-3972 or rmetcalf@abqjournal.com.
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