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Certifying LEED Certification: What Does That Mean?

As users of commercial real estate become more interested in sustainable practices, buying or leasing a LEED®-certified building becomes a business deal point.  How does an attorney or real estate manager determine if a particular target was properly LEED certified or has kept the certification status as advertised?  The U.S. Green Building Council (USGBC) continues to evolve its LEED certification process and increasingly is focused on how a building performs over the longer term after the paint has dried and the grass grown in.  There will come a time, in my opinion, that to keep the most coveted LEED Certification status, periodic re-submission will be required to confirm the original energy and resource efficiency of a building, site or development. So, is there a cost-effective due diligence process to understand that in a lease or acquisition setting?

Besides relying on representations of the seller or landlord, you could hire an architect for an opinion.  Or, you could rely on the plaque on the wall.  Or, you could check the USGBC website database (if you are a member). Or, you could hire Fidelity National Financial (FNF), which has rolled out a due diligence certification product to answer the need.  Depending on the magnitude of the subject project, it is not cheap like a flood zone certification.  Pricing is $1,500 per certification.  I have not used it yet to determine if it is worth the price.  But it seems unique and may be a good solution if other alternatives are unavailable.  It may be particularly useful in REO property situations where there is no party willing to make any representations about the assets.  FNF has apparently gotten inside the USGBC database and will combine that access with its own acumen gained from a century of title insurance experience to make this product available.  As I stated, I have not used this product yet, and this is not an endorsement.  There certainly are other ways to conduct the due diligence, but in certain situations, this might be an appropriate tool.

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