LEED Certification of Commercial Properties Sees Big Post-Covid Increase

By Lindsey Coulter 

The Covid-19 pandemic changed the way many people in the United States work, shifting numerous companies to remote and hybrid operations and—for a time—pushing commercial real estate vacancies (specifically office buildings) to nearly 20% at the end of 2023. However, as companies begin to rebalance hybrid work and bring more operations back to the office, the U.S. Green Building Council (USGBC) reports that interest in its LEED for Operations and Maintenance (O+M) certification has increased significantly.  

Between 2019 and 2024, the USGBC saw a 79% increase in O+M certifications across 215 million square feet of office space. According to the USGBC, the average project size in 2023 was 173,285 square feet, a bit smaller than 2019, when the average project size was 181,730 square feet, which reflects remote work trends. 

In a post on the USGBC website, Lisa Stanley, director of client solutions, noted that developers in the office space market appear highly motivated to address sustainability in the built environment. Stanley pointed to a 2021 report from Cushman and Wakefield that analyzed LEED certifications of office buildings in the decade leading up to the Covid-19 pandemic. The report, “Green is Good, Sustainable Office Outperforms in Class A Urban Markets,” found that properties that had achieved certification saw clear economic benefits. Not only were rents 11% cheaper on average, but certified buildings also saw lower vacancy rates and, across the decade studied, proved to be more resilient in periods of economic downturn.  

A similar 2022 CBRE study of approximately 20,000 office buildings across the country found that LEED-certified spaces commanded 31% higher rent rates compared to non-certified counterparts. The CBRE report also noted benefits of LEED certification for all parties: tenants appreciated lower energy costs and increased productivity; owners saw higher asset values; and certified buildings offered investors a lower risk of mortgage default. 

“When we look to the future, we see these trends not only continuing, but accelerating,” Stanley wrote. “In addition to having healthy, high-performing office spaces, we are now focused on meeting critical demands to decarbonize. The commercial real estate market is successfully working on incorporating low-carbon strategies for their existing buildings.”  

For example, this week the national firm Vornado Realty Trust became the first major real estate owner, operator and developer to achieve 100 percent LEED certification across its entire portfolio of in-service buildings. Over the past two years, the company has submitted its entire 26.1-million-square-foot in-service portfolio for USGBC review and recertification. Of those, 24.8 million square feet across 25 buildings achieved the highest LEED Platinum or Gold ratings. The company’s decades-long commitment to responsible development applies to design, construction and retrofits to maintenance, operations and tenant improvements as well as collaborating with tenants to reduce consumption through the implementation of submetering, real-time monitoring of energy use and other energy curtailment measures. 

Michael Franco, president and chief financial officer of Vornado, says the company is focused on technology, resilience and health, and credited the USGBC benchmarks, tools and support for helping the company achieve its sustainability goals. 

“We are dedicated to consistently being at the forefront of sustainability by making smart infrastructure improvements, investing in sustainable technologies, employing best practices for building operations and establishing partnerships with our tenants,” Franco said in a statement. “This creates lasting value for our investors, tenants, employees and communities.” 

The USGBC also commended Vornado’s achievement, which marks the first of its kind in the country at this large a scale. 

“Vornado is maximizing performance and sustainability across its entire portfolio, demonstrating the benefits and value of green building and setting an example for the entire real estate industry,” said Peter Templeton, USGBC president and chief executive officer, in a statement. 

In considering drivers behind the increased interest in LEED certification for commercial and office spaces, Stanley also points to occupant health and broader awareness of environmental impacts. As communities grapple with diminished air quality due to wildfires and the impacts of extreme weather, LEED projects can offer improved ventilation and air filtration systems and help companies meet carbon-reduction goals.  

“We faced challenges during the pandemic, and we came out stronger, with a more targeted focus on sustainability,” Stanley wrote. “This optimism is motivating and will fuel the momentum behind LEED v5 in 2025. This rating system brings a road map to the market for existing buildings that will propel us forward into a low-carbon and resilient future.”