Regardless of whether former President Donald Trump or Vice President Kamala Harris wins the presidential election in November, a coalition of green building advocates is calling on the next administration to help address several commercial real estate (CRE) challenges.

The U.S. Green Building Council (USGBC), New Buildings Institute (NBI), Institute for Market Transformation (IMT), and Carbon Leadership Forum (CLF) partnered to release a detailed agenda for the next administration, aimed at helping commercial buildings recover from the current downturn and better prepare for the future. The coalition strongly urges the presidential campaigns to consider these policy solutions as part of their economic platforms.

Challenges

Following a global pandemic, the CRE sector is grappling with a growing number of challenges. According to the coalition, high interest rates, declining occupancy rates, and soaring insurance and construction costs have placed significant pressure on property owners and developers. These issues have resulted in widespread financial strain, not only in large urban centers but also in rural communities, leading to shrinking tax revenues and struggling business districts. At the same time, increasing climate threats present risks to real estate owners, insurers, and lenders that are destabilizing CRE finance and insurance markets.

While local governments and private-sector leaders are taking steps to address some of these issues, the coalition says the federal government has a critical role to play in revitalizing the CRE sector. Regardless of party, the next administration can implement policies that strengthen the sector’s resilience and enhance environmental sustainability, public health, and U.S. economic competitiveness.

Policy Recommendations

Specifically, the agenda calls for expanding the Sec. 48E Clean Electricity Investment Tax Credit (ITC) to cover energy efficiency investments. The ITC currently covers only electricity-generating technologies, such as on-site solar, even as energy efficiency is widely viewed as a foundational solution to energy and climate challenges. According to the coalition, this expansion would drive significant economic activity in retrofitting buildings to be more energy efficient and provide parity under the tax code for energy efficiency as the ITC transitions to a technology-neutral structure in 2025 while reducing demand on the power grid and accelerating the ability to meet clean energy targets.

Additionally, the agenda calls for tax incentives for office-to-residential conversions to address the high office vacancy rates and a strong need for more housing. It also offers a suite of initiatives to help construction markets transition to low-embodied carbon materials and improve indoor air quality, among other provisions.

“These policy recommendations outline steps the next administration can take to help struggling downtowns overcome current challenges and emerge better prepared for the future,” said Peter Templeton, president and CEO of USGBC. “This means buildings that are more resilient in the face of disasters, offer healthy indoor air quality, and incorporate energy efficiency, sustainable materials, and clean energy technologies that generate fewer carbon emissions and lower operating costs.”

Read the full policy brief here.

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