OCCUPANTS HEALTH, PRODUCTIVITY AND BUILDINGS

The purpose of a building is not only to provide shelter for its occupants, but also to provide an environment conducive to high performance of all intended occupant activities. Recent studies have shown that buildings with good overall environmental quality, including effective ventilation, natural or proper levels of lighting, indoor air quality, and good acoustics, can increase worker productivity by six to 16 percent.

An organization’s most significant financial commitment is usually to its employees. Many employers spend at least as much on salary related expenditures as they do on constructing an entire company building. In many organizations, salaries and associated benefits consume the majority of the annual operating budget. Based on, sample calculations, a typical employer could spend $233 per square foot annually for an employee.  Building construction costs generally fall below this level, often by 50 percent. In addition, annual employee salary related expenditures, using the numbers are approximately 130 times greater than energy costs. A productivity increase of six percent equates to savings to the employer of $14 per square foot eight times the cost of the building’s annual energy bill.

Given this information, an employer can decide to maximize the performance and efficiency of personnel resources through assessment of, and improvement to, the indoor environmental quality of its building. The following account of a recent renovation project illustrates this approach.

Reno Post Office

Reno,Nevada In the renovation of a U.S. Post Office in Reno, Nevada, the structure, a modern warehouse with high ceilings, was redesigned with a new ceiling sloped to enhance indirect lighting and improve acoustics. The original, harsh direct down lighting was replaced with softer, more efficient, and longer lasting lamps. The total renovation cost was $300,000. The associated annual energy savings totaled $22,400, and the projected maintenance savings, $30,000, for a combined savings of $52,400, which equated to a six-year payback. What the Post Office also discovered was that the renovation measures, which resulted in better lighting and acoustics, led to a productivity increase of more than six percent. Productivity savings alone were worth $400,000 annually, returning the entire renovation cost within the first year.

Both building owners and building tenant/employers can benefit in other ways by improving indoor environmental quality. For owners, these improvements can result in higher property values, longer tenant occupancy and lease renewals, reduced insurance and operating costs, reduced liability risks, extended equipment life, and good publicity. For tenants, benefits include reduced absenteeism and better employee morale, reduced insurance and operating costs, reduced liability risks, and community recognition.

If the building owner is also the employer, an organization can offset initial construction design and systems costs with the reduction of long term organizational and operational expenses over the building’s life cycle.

Productivity & Savings

A Typical 100,000 sq. ft. Office Building

Utility Costs Annual Utility Cost per Square Foot $1.80 Total Annual Utility Cost $180,000

Personnel Costs Average Employee Salary + Benefits $35,000 Average Employee Space per Square Foot 150 Estimated Number of Building Occupants 667 Annual Average Personnel Cost per Square Foot $233 Total Annual Building Personnel Cost $23,345,000

Savings Value of 6% Productivity Increase per Square Foot $14 Ratio of Productivity Increase to Energy Cost 8 times