A comment letter sent Sept. 6 by the Real Estate Roundtable, a coalition group, to the Appraisal Practices Board (APB) stated concerns about its first draft of the voluntary guideline “Valuation of Green and High Performance Property: Commercial, Multifamily and Institutional Properties.”
Industry groups joining The Real Estate Roundtable in signing the letter were the National Apartment Association, the National Association of Home Builders, NAIOP, the Building Owners and Managers Association International and the National Association of Real Estate Investment Trusts.
In its letter, the coalition noted several “significant” concerns about the draft, including:
- The need for closer consultation with facilities engineering and management experts to better guide an appraisal standard based on a building’s actual energy efficiency performance;
- The need for appraisers to “dig deeper” into a building’s sustainable features instead of assuming that a LEED rating or other certification automatically serves as a proxy for higher property values; and
- The need for a thorough review of high-performance tenant-leased spaces within commercial buildings that may positively impact an asset’s appraised value — particularly considering an anticipated “Tenant Star.”