Heterogeneous Price Premiums in Sustainable Real Estate? An Investigation of the Relation between Value and Price Premiums
Focusing on the voluntary LEED and ENERGY STAR environmental certification schemes in the United States, we investigate whether price premiums exist across all building value categories or are localized to specific value segments. We find that the largest value building segment does not demonstrate any price premiums, while the smallest value categories do. The concentrated supply of eco-labeled offices in large, high-quality buildings likely contributes to this phenomenon.