Dropbox Lease's Special Language
As you know, Kilroy inked a major lease with Dropbox for 100% of 333 Brannan St earlier this year. And the green language it contains is popping up in other Kilroy deals, we learned from the firm's VP of sustainability Sara Neff. Every lease Kilroy has signed since last summer has contained at least some green language, she tells us; they align the landlord and tenant's financial and environmental interests. Standard lease language is a major barrier to sustainability in real estate, she says. You can buy a high-performance building, but if your leases prevent you from operating it sustainably, it's not a sustainable building. (Sort of like filling up your Prius with leaded gas.)
Sara (with some of the firm's awards for sustainability) says the only push-back has been on a clause requiring tenants to disclose their utility use data to the landlord. But, she notes, landlords are required in certain instances to report their buildings' energy usage under AB1103. Plus it starts a conversation on reducing consumption. Kilroy recently was named a Green Lease Leader—a new recognition program launched by the Institute for Market Transformation and the US Energy department's Better Buildings Alliance. Collectively, the 14 inaugural Green Lease Leaders own or manage 400M SF on four continents.