LEED / Green Building Certification Market

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LEED / Green Building Certification Market

Key Takeaways

  • The new state requirements and regulations include certification points; Certified 40-49 points, Silver50-59 points, Gold 60-79 points, and Platinum 80+ Points
  • LEED-certified buildings are impacting related markets because of the value they add. Interested buyers and investors are impressed by how these buildings are environmentally friendly as they are more efficient on energy and resource-saving.
  • Resources Defense Council (NRDC) and non-profit organizations such as the USBGC, which offers accreditation and program development, are some lobby groups that campaigned to credential individuals involved in design and construction.
  • According to the US Green Building Council (USBG), Massachusetts is the leading state of 10 top states for LEED green building based on the certified square feet per capita. Across the top ten states, more than 60% accounted for certifications for K-12 projects, healthcare, office, and higher education.
  • In 2020, there were 100,015 LEED professionals within the top 10 states for LEED.

Introduction

  • More product transparency, technological advancements, and more stringent state rules and requirements are new trends in the US LEED / green building certification market. There are varying market drivers for each of these trends, which is evident in the changes and new forms that are reshaping this market. More developers, architects, and stakeholders are changing their attitudes and adapting to these recent trends by prioritizing LEED-certified constructions and buildings.

Trends In The US LEED /Green Building Certification Market

More Product Transparency

  • The US LEED / green building certification market has promoted more transparency and accessible products' sustainability information by manufacturers. Sustainability lobbyists have been a driver for this trend. They have played a part in ensuring that transparent information on environmental and health impacts is availed to stakeholders in the design and construction marketplace, especially with planning green construction projects. Actual environmental performance has significantly continued to be prioritized in the product specification.
  • Manufacturers have been tasked with disclosing products and ingredients to give professionals and stakeholders a fair opportunity to choose the products that meet the established standards. Architects, designers, and specifiers are also required to show their documentation. Transparency documents provide assurance and disclosure of materials, ingredients, and environmental impacts in selected products.
  • The three most important Declare labels required today include the Red List Free products, the Red List Approved products, and Declared products. The Red List Free products disclose 100% of any ingredients above 100 ppm or 0.01%. The Red List Approved products declare compliance of written requirements and at least 99% of products above 100 ppm or 0.01% in the final product, while claimed products disclose 100% of product ingredients with 100 ppm or 0.01%.

Technological Advancements in Operations and Ratings

  • The evolution of technology is an evident trend in the US LEED certification market, which has prompted advancements in different aspects such as supply chain sustainability. Technology advancement has also continued to define healthy and competent constructions, embodied carbon, use of restorative materials and tools. As a result, USGBC has honed the LEED v4.1 rating system even further to match technology evolution in the certification market.
  • The availability of efficient green building tools has been a key market driver for technological advancement in the US LEED certification market. These tools play a significant role in improving the green building process, and they also promote environmental consciousness. The Embodied Carbon Construction, for instance, is a great tool that allows stakeholders and professionals to analyze different carbon impacts of products and make more informed decisions.
  • The technological advancements in the green building certification market have impacted building efficiency in the US. In 2020, for instance, the market generated annual revenue of approximately $94.5 billion.

State Requirements and Regulations

  • LEED certification state requirements and regulations include; compliance with environmental laws and standards, meeting the floor area requirement threshold, meeting the minimum number of building occupancy users, being a permanent building, and sharing water and data usage. The requirements and regulations include certification points; Certified 40-49 points, Silver 50-59 points, Gold 60-79 points, and Platinum 80+ Points
  • With time, these regulations have yielded the current LEED v4.1 reviewed rating system. This rating system has positively impacted Building Design and Construction (BD+C) as well as Interior Design and Construction (ID+C). As a result, there has been a notable advance in sustainable transformation, particularly building materials and comprehensive reports from stakeholders and project teams to meet the growing demands in this market.
  • Accessibility of certification institutions such as the Green Building Certification Institute has been a significant driver for reviewing and approving the new laws and regulations. Professionals and stakeholders are encouraged to use the newly announced Better Materials search function across databases to meet the set standards, such as buying the approved products.

Impact on Related Markets

  • The US LEED / green building certification market has impacted related industries such as real estate. The volume of new constructions has increased, and LEED-certified homes in various states have continued to grow. For instance, in Austin, Round Rock area, there has been an 8% boost in value in eight years. More industry reports indicate that LEED-certified homes can boost a home’s resale value. This has been a significant driver in increasing LEED-certified homes in real estate and has seen a growth of up to 19% in single-family homes and multifamily buildings since 2017.
  • LEED-certified buildings are impacting related markets because of the value they make. Interested buyers and investors are impressed by how these buildings are environmentally friendly as they are more efficient on energy and resource-saving. These buildings also have efficient systems such as storage and collection recycling, use of renewable energy, and less water waste.
  • The US LEED / green building certification market has seen traditional rating systems such as FitWell and WELL. FitWell and WELL stakeholders have been challenged to create healthier buildings and accelerate technological adoptions in their construction and design as they strive to build more structures. These bodies have adopted easier, faster, and cheaper methods through the green building certification than in the past.

The US LEED / Green Building Certification Market

  • Leadership in Energy and Environmental Design (LEED) is the most reliable rating for green building systems in the US and worldwide. US LEED is available for virtually all building types as it includes a healthy and highly efficient framework that is cost-effective for green buildings. A wide variety of strategies are used to construct sustainable buildings under LEED. Some organizations that lobby for credentialing design and construction professionals include the Natural Resources Defense Council (NRDC) and non-profit organizations such as the US Green Building Council (USBGC). USBGC offers accreditation and program development, are some lobby groups have campaigned for credentialing of individuals involved in design and construction. Since the LEED certification was established, the number of green building certifications across the US has increased. LEED designation for new buildings and construction is a performance-based rating system where projects earn points based on how they have met the criterion through these lobby organizations.
  • Currently, there are over 203,000 professionals with a LEED certification, which proves that more Americans are interested in gaining knowledge, experience, and credibility required in the green building marketplace. The building professionals enter the green building marketplace in two main categories; LEED green associates and LEED AP with a specialty. LEED green associate professionals are competent in green building principles and practices, while AP with specialty professionals are equipped with LEED rating system.
  • According to the US Green Building Council (USBG), Massachusetts is the leading state of 10 top states for LEED green building based on the certified square feet per capita. Across the top ten states, more than 60% accounted for certifications for K-12 projects, healthcare, office, and higher education. The report further provides that California has the highest number of LEED professionals. Collectively, the rankings in 2020 represented 1,171 certified buildings and spaces and over 100,000 workers in green buildings in the top ten states.
  • While Massachusetts has always made the top 10 list each year, it has not held the top position since 2017. As the leading state in LEED, the state-approved 76 projects in 2020, representing 2.91 square feet of LEED-certified space for every resident. Washington made the most remarkable leap by joining the top 10 list from outside to number two. Other states such as Nevada and Texas also returned to the top 10 list after being outside since 2019. The top 10 list are also areas with the highest demand for LEED professionals.
  • Massachusetts, Washington, and Illinois are some states where professional credentials are more valued. These states also have stringent requirements for the profession. These requirements look into the levels of education, training, and skills that the professionals have. The training and skills are meant to promote various benefits of LEED-certified projects, including cost-saving for households, businesses, and taxpayers and a healthier environment due to reduced carbon. Investors are also likely to invest more in these states as they have critically demonstrated progress aligns with Environmental Social and Corporate Governance (ESG) commitment. These professionals must have the US LEED certification such as certificate, silver, gold, and platinum. These levels ensure thorough and stringent application of various green techniques right from the planning, construction, and operation phases.

Number Of Professionals With LEED Certification In The US

Research Strategy

This research has relied on publicly available sources such as Construction Exec, Living Future, and Statista to provide information on the new trends in the US LEED / green building certification market. With the help of these sources, we have provided the varying market drivers for each of these trends and how these drivers are reshaping this market. This research also includes in-depth information on why more developers, architects, and stakeholders are changing their attitudes on LEED-certified constructions and buildings.

To provide an overview of the US LEED / green building certification market, we relied on publicly available data such as the official website for the US Green Building Council (USBG), Statista, and Ever Blue Training. These sources have helped establish information on the industry overall and the workforce. We could not find separate data and statistics for various LEED-certified professionals such as architects, engineers, and construction professionals. We, therefore, relied on data covering overall professionals in this market.

We could not find any publicly available data on the number of workers leaving the LEED industry. The research provides information on states with higher professions and where professional credentials are more valued. However, we could not find any data on any of the states with lower demand for people in the professions or states where professional credentials are less valued. We have also highlighted the trends in requirements for LEED, such as education, training, and skills. While we could not find quantifiable data on the indication of the direction of this designation for new buildings, we provided qualitative data and included examples of organizations lobbying for credentialing of individuals involved in design and construction. For the unavailable information, we combed various industry reports and sources such as the US Green Building Council (USBG), Statista, Mannington Commercial, TSG Construction, government official websites, and Construction Review.

Information about the number of LEED professionals in individual states was not available. We searched each state for this information, but the latest publicly available information was last updated in 2018. This data was not included in this project owing to the huge number of LEED professionals joining each year. In this research, we only included the number of LEED professionals within the top 10 states for LEED, with the latest information being in 2020.

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