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ESG Real Estate: Green Buildings Now Command a 12% Rent Premium
Tenants and lenders increasingly favor certified sustainable properties. Retrofitting may be the highest-ROI play of the decade.
SM
Sarah Mitchell
May 18, 2026 · 9 min read
LEED Platinum and BREEAM Outstanding buildings now command rent premiums of 8-12% and exit cap rate compression of 50-75 bps versus comparable non-certified assets. Lenders offer green loans at 25-50 bps below conventional rates. For value-add investors, deep-energy retrofits of 1980s-90s office and multifamily stock are delivering 20%+ IRRs when paired with rebranding. We share our scoring rubric for identifying the best retrofit candidates.