Smart Investments in Energy Efficiency

A Look At The Portrait Building in Washington, D.C.

How can energy upgrades enable forward-thinking building managers to provide considerable value to both owners and tenants? This case study examines recent energy improvements to The Portrait Building in downtown Washington, D.C. as a real-world example of the potential gains. Three efficiency measures, completed for a total of $169,946 (or $1.27 per square foot) will pay back in a little over two years and, over an assumed 10-year useful life, offer a cumulative net present value of $578,248 and a 49 percent internal rate of return. Their total return on investment (ROI) is estimated to be 440 percent, equivalent to a 44 percent annual ROI. With projected annual cost savings of $75,252, this project show how modest investments in energy efficiency can have large impacts on a property's bottom line while benefitting tenants and the environment.

This work is complementary to IMT's recent Valuing Energy Efficiency case study series, which examines the financial outlay and impact of energy efficient retrofits on a range of building types across the U.S., to show that building owners do not need a billion dollar budget or a large floorplan to reap all the benefits of energy efficiency. In addition, more information on green building and its effects of property value can be found here.