For years, warehouses have lagged offices and retail properties in adopting energy-efficient, low-carbon design. After all, why bother? The simple box structures, popular in the current pandemic-fuelled rise in e-commerce, are away from public view and under less pressure that other commercial real estate to demonstrate sustainability credentials.
But in 2017, determined to build a better box, executives at East Port Properties, a development, leasing and property management company in Dartmouth, N.S., asked a different question: Why not? The result is three fully occupied warehouses – one of them the first to achieve Canada Green Building Council certification for zero-carbon design and performance – built to limit their environmental footprint.
“It’s just the challenge of always doing better; if we can do something better and pay less, why not?” says East Port president Judy Wall, whose company portfolio includes several properties certified for Leadership in Energy and Environmental Design (LEED). “Even if you don’t believe in climate change and don’t believe in a green economy, why would you want to pay more for something if you could pay less?”
It is a looming question for warehouse owners, one industry analyst says.
The sector is “prime for change,” says Roelof van Dijk, senior director, national research and analytics for Colliers International in Canada, adding that East Port is “ahead of the game, for sure.”
Rising federal government carbon prices and growing corporate commitments to environmental, social and governance standards add to the momentum.
With low vacancy rates, “there hasn’t been a huge push because people are taking the space they can get,” Mr. van Dijk says, but adds “if you can build zero-carbon, energy-efficient buildings, there is a demand for it.”
Four years ago, Ms. Wall knew what she wanted – a low-carbon, energy-sipping warehouse – but not how to achieve it. With that end-goal in mind, she convened a meeting of company officials, consultants and a couple of retired engineers for one hour a week over six weeks to draft ideas.
The result is that 355 Wilkinson Ave. East Port, the first of three East Port warehouses built so far (with a fourth expected this year and possibly two more later) in northwest Dartmouth, won certification for zero-carbon design and performance. The tight building envelope for the 65,000-square-foot warehouse includes concrete walls with above-average insultation to limit unwanted air from outdoors.
Heat pumps transfer thermal energy from cooler to warmer spaces and a heat recovery ventilation system reduces demand for heating and cooling.
Instead of a conventional bay loading dock, East Port installed vertical storing dock levellers, typical for cold storage lockers, to seal overhead doors when not in operation.
“It was a win-win from an energy point of view, and it keeps the building very tight,” says engineer Gary Ruitenberg, president of Ruitenberg Inc., a consultant who joined the weekly brainstorming sessions led by Ms. Wall.
“I do a lot of industrial buildings and by the time owners get to my doorstep, they are panicked,” Mr. Ruitenberg says. “But Judy had foresight and challenged everyone to think outside the box.”
A concrete slab floor stores thermal heat while radiant heating close to the walls keeps the interior space at a uniform 17 C.
Solar roof panels generate renewable energy, while skylights with special diffusers add non-glare natural light. Inside, motion-sensor LED lights are activated when needed.
East Port purchases about $600 worth of carbon offset credits a year to retain the building’s zero-carbon performance, Ms. Wall says.
Unlike other property managers, East Port includes central heating in common operating costs, aiming for heat costs of zero dollars using renewable energy from the solar panels or renewable energy sold to the provincial grid, Ms. Wall says.
Tenants pay for heat they generate, such as when loading docks are left open to the elements. Then, the central heating system shuts down and individual metering kicks in when tenants turn on overhead heaters.
Since moving into a 30,000-square-foot space at 495 Wilkinson Avenue three years ago, the Thales Group has not paid for heating, says Richard Gravel, coastal operations and Halifax manager for the French technology company that supplies electrical systems and services for Coast Guard and other new vessels through the federal government’s shipbuilding strategy.
“I think it is magnificent,” Mr. Gravel says. “It gives cost stability for us and for our client, and we know there is not a surge in cold times of the year.”
His company, which pursues ESG practices, “looked at a lot of old places” but none offered the space, truck access or environmental attributes of 495 Wilkinson, he says. “It was so great to find a place that had a zero-carbon footprint, was environmentally sound and technically smart.”
East Port charges a 10-per-cent to 15-per-cent leasing premium a square foot, but has fully occupied warehouses, Ms. Wall says.
Still, East Port had no guarantee that its innovations would pay off.
The initial results of a third-party energy model of its plans, required to meet the green building council’s zero-carbon standards and energy-reduction incentives from Efficiency Nova Scotia, a provincial energy efficiency utility, were not encouraging.
Undeterred, East Port plugged in data from its LEED-certified buildings that showed the model, based on standard industry assumptions, overestimated the level of air infiltration at 355 Wilkinson. “If we didn’t have the hard data and just took the model, which is what most developers would look at, we would not have been able to build the building,” Ms. Wall says, emphatic about assessing data to make decisions.
For 355 Wilkinson, East Port estimates energy use of 3.2 electrical kilowatts a square foot from all energy sources, well below the 2018 Canadian mean of 16.3 electrical kilowatts reported by Energy Star Portfolio Manager, a tool for tracking energy and water consumption.
In the end, East Port delivered bottom-line gains and lower-carbon buildings, says Donald Dodge, business development manager at Efficiency Nova Scotia, a selling point he makes to property owners.
“You are going to be more competitive, which means you are going to be more profitable, and your properties are going to be more valuable,” he says. “It is a net positive asset.”
Fin MacDonald, manager of the green building council’s zero-carbon building program, shares that assessment. “E-commerce has grown fast since the pandemic and the warehouse sector is booming,” he says. “The buildings are going to be around for a long time; why not build them, right?