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Buildings emerge as drivers of health and profits
Corporate Real Estate Journal,
7
(2),
177-193
(2017)
Abstract
A confluence of factors has moved buildings to the forefront of efforts to promote the health and wellness of employees. This paper addresses why this has occurred, and how it will influence corporate real estate (CRE) and human resource decisionmaking in the future. The paper continues by describing and documenting a methodology for assessing the financial performance of health and wellness investments that can be used to analyse property and portfolio decisions (Property Health and Wellness ROI Model [The ROI Model]). The ROI Model is then applied to a hypothetical investment in the WELL Building StandardTM for a 200,000 sq.ft office building to demonstrate the sensitivity and substantial profit potential of building level investments in health and wellness. Proper financial assessment of health and wellness investments can enable dramatic improvements in occupant health and productivity, and provide a strong financial foundation for other energy and sustainability investments.3
Keywords: corporate real estate; health and wellness; human resource management; WELL Building StandardTM; sustainability; decision-making; capital budgeting; facilities management
The full article is available to subscribers to the journal.
Author's Biography
Scott Muldavin CRE, FRICS, is President of The Muldavin Company, a real estate strategy consulting firm. For the previous 10 years, as a Senior Advisor to Delos, creator of the WELL Building StandardTM, Executive Director of the Green Building Finance Consortium and a Senior Fellow with the Rocky Mountain Institute, he has led the movement to scale sustainable property investment through improved financial analysis that fully integrates health, wellness, productivity and energy benefits into sustainable property investment decisions. In addition to leading The Muldavin Company, Scott cofounded Guggenheim Real Estate, a US$ 3bn private real estate company, was a lead real estate consulting partner at Deloitte, and has completed over 300 consulting engagements involving corporate real estate, investment, and valuation. He has authored over 225 books and articles on real estate finance, investment and sustainability, and was 2017 Chair of the Counselors of Real Estate.1
Chris R. Miers CRE, FRICS, is a Principal at Bard Consulting, providing strategic real estate solutions to institutional clients. For the past eight years, he has focused his practice on investment and manager due diligence, the workout of distressed assets and portfolios, transaction structuring, and quantitative analysis. Prior to joining Bard, he was an Asset Manager for Babcock & Brown, a global investment and advisory firm, where he identified and invested in target markets, performed due diligence, originated new and restructured existing investments, and managed investment partner relationships. He also was in the Investment Management group at the Shorenstein Company where he performed fund management services. Prior to that, he was at AMB Property Corporation (now Prologis) where he worked in various roles.2
Ken Mcmackin is a candidate for a Master’s in Business Administration from the Haas School of Business at the University of California, Berkeley. He specialises in real estate valuation for financial reporting purposes. In addition to valuation work, he has also performed due diligence and a variety of consulting engagements. His clients include corporations, equity funds, private owners and financial institutions.
