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ILFI to Study the Cost of Green Building
Jennifer Goodman / ECOBUILDING Pulse / May 30, 2013
The International Living Future Institute (ILFI) has received funding to support a research project dedicated to developing a new financial model for advanced green building and infrastructure projects.
The “Economics of Change” initiative will work at local, state, and federal levels to examine accounting practices, valuation policies, regulatory structures, and green building incentives. The ultimate goal of the project is to develop a new model for real estate investment that will remove the artificial financial disincentives for deep green buildings, according to a press release from ILFI, which also operates the rigorous Living Building Challenge performance standard.
“It’s time for our economic models and valuation methods to expand in the same manner and pace as has our knowledge of sustainable design and clean technologies,” says Jason Twill, the project’s originator and chair of the Institute’s board. “It is not a design or technology challenge that we are currently faced with, but one of value and full accountability. This project will create new paradigms for valuation and financing of our built environments that will benefit all bottom lines.”
The combined funding from the John D. and Catherine T. MacArthur Foundation, the Bullitt Foundation, and the Russell Family Foundation will allow the Institute and its research team to focus on both local case studies and national-level policies. The multidisciplinary research team behind the project is composed of experts in the fields of ecosystem services, real estate finance, appraisal, and sustainable design. By integrating practical knowledge of the real estate market with expertise in complex systems analysis and ecological economics, this group will aim to catalyze a shift in both theory and practice, the release says. An advisory board of leading thinkers in financing, appraisal, development, policy, and ecosystem services will provide support to the research team.
According to ILFI executive director Richard Graves, the project will focus on helping to shift hundreds of billions of dollars of real estate investment towards restorative buildings. Efforts to address structural change in the financial industry have been piecemeal to date, he says.
“Without an overarching plan for rapid and holistic transformation,” he adds, “the ‘green premium’ will continue to slow the uptake of emerging best practices.”
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