Willingness to Pay for Green Buildings: Empirical Evidence from Switzerland
Taylor and Francis Online
The demand for green buildings and to what extent firms will pay a premium price compared to conventional buildings is a lively debate. Policy instruments like the Swiss CO2-enactment and the Swiss Building Program encourage and incentivize investments in energy-efficient properties. Based on a corporate real estate survey, I investigate the premium percentage price firms are willing to pay for green buildings. On average, Swiss corporations are willing to pay a premium price of 3.0% for leasing, 4.75% for purchasing, and 5.0% for retrofitting. Depending on firm characteristics, the premium price ranges from 1.3% to 7.9% compared to conventional properties. Firms from the building and financial service industries, as well as public corporations and authorities signal the highest willingness to pay.