Page 312 - The Green Building Bottom Line The Real Cost of Sustainable Building

290 CHAPTER 9

TABLE 9.1 LEGAL FEES FOR A CONVENTIONAL PROJECT

ASPECT OF WORK PROJECTED LEGAL FEES
Acquisition and Financing $0.43 per square foot ($30,000)
Design, Construction, and $0.30 per square foot ($21,000)
Entitlement
Leasing $1.20 per square foot ($84,000)
Total $1.93 per square foot ($135,000)

and tenants can be expected to resist or negotiate provisions related to the green fea-
tures and operations of the building.
Applying these percentages to the numbers in the previous example, the budget for
legal fees changes as shown in Table 9.2.
The total increase in legal fees in this example is $12,000, or 8.88 percent greater
than fees anticipated as part of a conventional non-green development project. In the
overall scheme of our fictionalized green development project of $15 million, the
added cost amounts to eight basis points, or less than one-tenth of one percent.
The benefits of these increased legal costs, though difficult to quantify, can be sig-
nificant, and include the successful construction, certification, leasing, and sale of a
project; the avoidance of violations of law; the achievement of tax credits and other
incentives; and the prevention of lawsuits.

Concluding Remarks

The development, financing, operation, management, and leasing of a commercial
building is a complex process; this is especially true in the case of a green building
project. There are a large number of stakeholders involved in and affected by a devel-
oper’s decision to develop a green building. Underpinning the relationships between

TABLE 9.2 PROJECTED LEGAL FEES FOR A GREEN PROJECT

PROJECTED GREEN BUILDING NEW PROJECTED
ASPECT OF WORK LEGAL FEES PREMIUM LEGAL FEES
Acquisition and $30,000 5% ($1,500) $ 31,500
Financing
Design, Construction, $21,000 10% ($2,100) $ 23,100
and Entitlement
Leasing $84,000 10% ($8,400) $ 92,400
Total $147,000