The economics of green building

P.M.A. Eichholtz*, N. Kok, J.M. Quigley

*Corresponding author for this work

Research output: Contribution to journalArticleAcademicpeer-review


We analyze the economics of green building, finding that recent increases in the supply of green buildings and the volatility in property markets have not affected the returns to green buildings. We then analyze a large cross-section of office buildings, demonstrating that economic returns to energy-efficient buildings are substantial. Finally, we relate the economic premiums for green buildings to their relative efficiency in energy use-the attributes rated for thermal efficiency, as well as sustainability, contribute to premiums in rents and asset values. Among green buildings, increased energy efficiency is fully capitalized into rents and asset values.
Original languageEnglish
Pages (from-to)50-63
JournalReview of Economics and Statistics
Issue number1
Publication statusPublished - 1 Jan 2013

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