Introduction to Building Economics

Lecture# 1

LECTURER : SANA ALEEM

MSc Architecture and Environmental
Design
BSc Architecture Engineering
Introduction

Buildings
-Role and Importance
-Built Environment
-Significance
Introduction

Building owners generally wish to lower costs or increase profits.

To accomplish this, buildings must be located, designed,
engineered, constructed, managed, and operated with an eye to
the economic consequences of these decisions.
Introduction

• Owners need to select locations which enhance revenue

opportunities, or lower costs, or both.
• Architects need to consider the owning and operating costs of
alternative building designs.
• Mechanical and structural engineers need to take into
account the economy of alternative designs and sizes of
building systems and components.
Introduction

• Architects and engineers need to work together to make

economic tradeoffs between the building envelope and
mechanical systems.
• Construction companies and builders need to select cost-
effective materials, equipment, and construction techniques.
• Building managers and operators need to establish cost-
effective maintenance, repair, and replacement policies, and
to decide when and what to renovate.
• In short, those who design, engineer, construct, manage,
operate, and own buildings are faced with numerous
decisions which affect the economics of buildings
Principle

• A building decision is "economically efficient" from the

standpoint of the decision maker if net benefits (profits) are
maximized as a result of the decision.?
• For example, if investing in an office building is both
• (1) profitable
• (2) more profitable than other available options for an
investor, it is the economically efficient investment choice for
that investor. If a building location will yield greater revenue
but will cost the same or less than alternative locations.
Principle

• There are three purposes for constructing buildings—

1 Build & sell
2 Build & retain:
self use
Lease/ rent
3. Build on behalf of others
Principle

• Buildings as consumers of Resource & money

• Shell & core concept
• Cost effective Building

• Cost of building
1-Life cycle cost
2-Initial Cost
3-Operational Cost
Linear Economy & Circular Economy
Principle

• The Construction Industry is responsible for over 30% of the extraction of

natural resources, as well as 25% of solid waste generated in the world.
This happens because the construction sector mostly adopts a linear
economic model of “take, make, dispose”, using materials to the
construction of buildings and disposing them at the end of life, since they
are assembled for one time use and don’t retain potential for reuse.

• Over the last decades, a paradigm shift has been occurring in the industry
at large, with the adoption of a Circular Economy model, that aims at
keeping the materials in a closed loop to retain their maximum value,
therefore with a greater potential of reducing the waste generation and
resources extraction for the Construction Industry
Watch the following
https://www.youtube.com/watch?v=8XYbqLbeiL8
IMPLICATIONS OF ENERGY, ENVIRONMENT / RESOURCES ON
BUILDINGS
Example
Example
Example
US GREEN BUILDING COUNCIL HEADQUARTERS
WASHINGTON , D.C
INTRODUCTION

• Our built environment is all around us. The built environment provides a context
for facing and addressing humankind’s greatest contemporary challenges. Built
environment is an environment that is man made and provides a structure for
human activity .
• Green building is fundamentally a process of continual improvement.
• A process by which todays’ “best practices” becomes tomorrow’s standard
practices, a rising foundation for ever higher levels of performance.
• Green building can help us create more vital communities.
WHY GREEN BUILDING NECESSARY?
GREEN BUILDINGS

• Building and communities, including the resources used to create them

and the energy , water , and materials needed to operate them, have a
significant effect on the environment ad the human health . In the US,
buildings account for
• 14% of portable water consumption
• 30% of waste output
• 40% of raw materials use
• 38% of carbon dioxide emissions
• 24% to 50% of energy use
• 72% of electricity consumption.
ISSUES- HABITAT
ISSUES- AIR AND WATER POLLUTION
ISSUES- WASTE
ISSUES- TRANSPORTATION
GREEN BUILDINGS

• The cumulative effect of conventional practices in the building industry

has profound implications for the human health, the environment and the
economy .
• Clearing of land for development often destroys wildlife habitat
• Extracting , manufacturing and transporting materials may pollute water
and air.
• Building operations require large inputs of energy and water and generate
waste streams
• Transportation to and from buildings by commuters and services
providers compound harmful environmental effects
GREEN BUILDINGS

• By building green we can reduce the environmental damage

• A study by New buildings Institute found that in green buildings, average
energy use intensities ( energy consumed per unit of floor space) are 24%
lower than in typical buildings.
WHAT IS GREEN BUILDING?
GREEN BUILDINGS

• Green building is a process that applies to buildings, their sites, their

interiors , their operations, and the communities in which they are
situated
• The process of green building flows throughout the entire life cycle of a
project , beginning at the inception of a project idea and continuing
seamlessly until the project reaches the end of its life and its parts are
recycled or reused.
GREEN BUILDINGS

• “Sustainability” and “Green” , often used interchangeably, are about more

than just reducing the environmental impacts. Sustainability means
creating places that are environmentally responsible, healthful , just ,
equitable, and profitable.
• Greening the built environment means looking holistically at natural ,
human and economic systems and finding solutions that support quality of
life for all
GREEN BUILDINGS- TRIPPLE BOTTOM LINE

Triple Bottom line is often used to refer to concept of sustainability

. The term was first coined by John Elkington . The triple bottom
line concept incorporates a long term view for assessing potential
effects and best practices for three kind of resources:

• PEOPLE ( SOCIAL CAPITAL). All the costs and benefits to the

people who design , construct, live in , work in , and constitute
the local community and are influenced , directly or indirectly ,
by a project.
• PLANET (NATURAL CAPITAL) All costs and benefits f a project
on the natural environment, locally and globally
• PROFIT (ECONOMIC CAPITAL) All the economic costs and
benefits of a project for all the stakeholders ( not just the
project owner)

The GOAL of Triple bottom line , in terms of environment, is to

ensure that buildings and communities create value for all
stakeholders.
GREEN BUILDINGS- LEEDS

LEED
• Leadership in Energy and Environmental Design program is green building
certification program
• It is applicable to buildings at any stage of their life-cycle.
GREEN BUILDINGS- LEEDS

There are many ways to organize green building projects, This section uses some of the
major categories associated with the LEED rating systems for the organization :
A- Location and transportation
B- Sustainable Sites
C- Water efficiency
D- Energy and Atmosphere
E- Materials and Resources
F- Indoor Environmental Quality
G- Innovation
LEEDS- LOCATION AND TRANSPORTATION

Good project develops into paces where it will improve, rather than degrade.

STRATEGIES TO ADDRESS LOCATION:

• CHOOSE REDEVELOPEMENT AND INFILL DEVELOPMENT. Build on previously developed land

and brownfield sites
• PROTECT HABITAT. Give preference to locations that do not include sensitive sites elements
and land types
• INCREASE DENSITY. Create a smaller footprint and maximize the FAR(floor area ratio) or
square footage per acre
• INCREASE DIVERSITY OF USES. Provide the services that are most needed within
communities and support a balance of jobs and housing
• ENCOURAGE MULTIPLE MODES OF TRANSPORTATION .Enable occupants to walk , bicycle
and use public transit .
LEEDS- LOCATION AND TRANSPORTATION

According to US energy administration , transportation accounted for 33% of the total

US greenhouse gas emissions in 2008. Globally, transportation is responsible for 13.5%
of the total carbon dioxide emissions. Generally this is a result of three fundamental
factors
• Land use
• Vehicle technology
• Transportation fuels
LEEDS- LOCATION AND TRANSPORTATION

STRATEGIES TO ADDRESS TRANSPORTATION IN DESIGN AND PLANNING

• LOCATE NEAR PUBLIC TRANSIT. Select a project site within easy walking distance of an existing
transportation network
• LIMIT PARKING. The lack of parking spaces on the project site will spark interest in alternative
transportation options
• ENCOURAHE BICYCLING . Install secure bike racks and showers for the commuters.

STARTEGIES TO ADDRESS TRANSPORTATION IN OPERTIONS AND MAINTENANCE

• ENCOURAGE CARPOOLING . Designate preferred spaces for carpool vehicles in the parking area
• PROMOTE ALTERNATIVE-FUEL VEHICLES. Provide a convenient refueling station on the site
• OFFER INCENTIVES. Develop an alternative commuting incentive program for the building occupants
• SUPPORT ALTERNATIVE TRANSPORTATION. Promote alternatives to single occupant car commuting at
the building and/ or city level.
LEEDS- SUSTAINABLE SITE

STARTEGIES FOR DEVELOPING A SUSTAINABLE SITE DESIGN

• MINIMIZE HARDSCAPE. Substitute previous surfaces for traditional paving

• USE NATIVE LANDSCAPING. Select plants that are native to the area both to reduce water
use and to provide habitat for local birds and other species. Incorporate mulch into the
landscape to build the soil and naturally suppress weeds
• PREVENT LIGHT POLLUTION . Avoid up-lighting , glare and the trespass by using shielded
fixtures and strategic lighting design
• PRESERVE OPEN SPACE AND SENSITEVE AREAS. Consolidate the development of footprint
and protect and restore natural vegetation, wetland area and bodies of water
• PROTECT AND RESTORE HABITAT. Designate areas as protected habitat and open space for
the life of the project.
LEEDS- WATER EFFICENCY

• STARTEGIES FOR REDUCING INDOOR AND OUTDOOR WATER USE.

• Install efficient plumbing fixture

• Use non potable water
• Install Sub meters
• Choose locally adapted plants
• Use xeriscaping
• Select efficient irrigation technologies
LEEDS- ENERGY AND ATMOSPHERE

STARTEGIES FOR REDUCING ENERGY DEMAND IN DESIGN AND PLANNING

• Establish design and energy goals

• Size the building appropriately
• Use free energy
• Insulate

STRATEGIES FOR ACHIEVING ENERGY EFFICIENCY

• Address the envelop

• Install high performance mechanical systems and appliances
• Use high efficient infrastructure
• Capture efficiencies of scale
• Use energy simulations
• Monitor and verify performance .
LEEDS- MATERIALS AND RESOURCES

STRATIGIES FOR CONSERVING MATERIALS THROUGHOUT A PROJECT’S LIFE CYCLE

• Reuse existing buildings and salvages materials
• Plan for smaller, more compact communities
• Design smaller , more flexible homes and buildings
• Use efficient framing techniques
• Promote source reduction in operation.

STRATIGIES TO REDUCE WASTE DURING CONSTRUCTION

• Design buildings that produce less waste
• Develop a construction waste management policy
• Establish a tracking system
• Provide recycling for durable goods
LEEDS- INDOOR ENVIRONMENTAL QUALITY

STRATEGIES FOR DESIGNING GOOD INDOOR AIR QUALITY

• Prohibit smoking
• Design for proper ventilation
• Protect air that comes into the building
• Test for on site contaminants
• Design for entryway systems
• Specify low emitting materials
• Calibrate sensors
LEEDS- INDOOR ENVIRONMENTAL QUALITY

STRATEGIES FOR IMPROVING OCCUPANTS’ COMFORT AND CONTROL

• Use day lighting
• Install operable windows
• Give occupants temperature and ventilation control
• Conduct occupants surveys
• Provide ergonomic furniture
• Include appropriate acoustic design
FOR ANY QUESTIONS ,
comment in Google classroom, or drop an email @
sanaaleem7@gmail.com