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Tenant Star

Congress recently passed the Energy Efficiency Improvement Act of 2015 — the first bill directed at improving tenant energy efficiency. Building upon ENERGY STAR Portfolio Manager’s success getting commercial real estate owners to track and act upon energy performance, the bill grants the U.S. EPA authority to develop a similar solution for space leased by tenants – historically the black box portion of a building’s energy usage.

“There’s a lot of low-hanging fruit — this is the area where we can have the greatest environmental impact.” President Obama, April 30th, 2015

Tenant Star will look beyond intrinsic building performance, focusing on quantifying and improving the environmental performance of tenant occupation and behavior. By addressing the performance of tenant space, legislators hope to balance the efforts of building owners between leased and common spaces – the latter being the portion building owners typically control and therefore are more likely to act upon. While it’s not clear how the U.S. EPA will benchmark and evaluate performance of tenant spaces, let alone promote the idea to a fragmented user base, it will certainly be an important mechanism for increasing owner-tenant engagement and disclosure of ESG performance.