As it nears completion of a major restoration project, the Pac Mutual building in downtown Los Angeles has reached an unexpected milestone: Earlier this month, the historic property was certified LEED Platinum, the highest sustainability ranking given by the U.S. Green Building Council.
The building, constructed in 1908 with major additions in 1921 and 1928, is now the oldest and only historic building in Los Angeles to be designated a Leader in Energy and Environmental Design at the platinum level.
Downtown L.A. real estate company Rising Realty Partners bought the Pac Mutual building, at 523 W. Sixth St. and overlooking Pershing Square, for $60 million in 2012. Since then, it has spent nearly $25 million to reposition and upgrade the building.
Christopher Rising, the company’s president and chief operating officer, said that from the outset of the pricy renovation process, one of the company’s biggest goals was to improve the property’s environmental standing. Still, he was surprised by the outcome.
“Quite frankly, we were hoping for LEED Gold,” he said, the second-best ranking in the certification spectrum. “We weren’t sure it was possible to take a 100-year-old building and make it LEED Platinum.”
The milestone for the Pac Mutual building comes at a time when California landlords are increasingly working to improve the energy efficiency of their buildings, spurred in large part by the state’s stringent energy codes. Last week, the Green Building Council ranked California fifth in the nation – tied with New York – for LEED certification on a per capita square-foot basis. In 2013, nearly 73 million square feet of real estate was certified in California, of which more than 20.6 million square feet was for buildings in Los Angeles County.
It was not possible to extract the added cost of platinum LEED certification from the $25 million Rising spent on the rehab, though seeking certification certainly came at a premium.
“The building went through a comprehensive energy audit and also an assessment of the indoor air quality,” said Seth Strongin, sustainability manager for Leading Edge Consultants in Tarzana who worked with Rising to help certify the Pac Mutual building. “Those are expenses they arguably did specifically for LEED certification.”
But however popular it might be to certify buildings – 253 in Los Angeles gained or upgraded certification last year – could it possibly be worth the expense?
Mario Camara, a real estate attorney at Cox Castle & Nicholson in Century City, said most landlords find that having some level of LEED certification can prove financially beneficial for reasons beyond saving on water and power bills. It’s also a marketing tool that is a proven way to attract and retain tenants.
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