Structural Investments Take Time To Pay Off
By: Steve Hendershot July 20, 2009When the dining room at Uncommon Ground's Edgewater restaurant hits its mid-afternoon lull, owners Michael and Helen Cameron climb to the rooftop. There they study the progress of their vegetable farm not a garden, but a certified production farm that will yield more than a thousand pounds of food this year and lament the cool, windy June afternoon that prohibits the solar thermal panels on the rooftop's north edge from operating at peak efficiency.
The Camerons' restaurant is both a testament and proving ground for their belief in everything green. They've done it to show that sustainability can be, well, sustainable that investing in green technology can help a business run profitably and efficiently.
But while making major investments in green tech can serve the environment and also yield dividends, making those investments isn't a simple decision. For one thing, the payback periods can be lengthy, which is an especially important consideration during a recession. And because much of the technology is new, performance can be hard to predict.
In fact, that's one of the Camerons' motivations: to get some data on the books that can benefit other business owners.
"We don't make these investments unless we think they're sure things in terms of savings," Ms. Cameron says. "We did some extreme things here, and we want to show other businesses that they make sense."
Those extreme things include spending more than $120,000 to make the rooftop farm-ready and more than $20,000 to install the solar panels, which heat the restaurant's water.
The Camerons are on
pace to recoup their investment in 2010. And then there's the bottom line:
The restaurant, which opened in December 2007 as the economy was faltering,
is operating profitably.
"Companies have been in a testing-ground phase, trying to figure out what's possible, what's replicable. If these buildings reduce their environmental impacts but cost them money, then businesses don't keep building them," says Marc Heisterkamp, director of commercial real estate for the Washington, D.C.-based USGBC. "But companies are finding that there is a payback. It may take three years to realize, but it's there. And we're seeing companies that have done this once are doing it a second time, and then they're looking to scale up."
Business owners who are watching their peers for signs that green investments will pay off can be grateful for early adopters like the Camerons and Michael Abt, president of Abt Electronics in Glenview. He has invested in an array of green technologies, ranging from urban windmills to biodiesel-powered delivery trucks. The windmill has a 15-year payback period, which Mr. Abt acknowledges is too long for most businesses. But for him, the chance to evaluate new technology supersedes strict business analysis.
"We're not looking for return on investment. We're looking for the next cool thing," he says, though he also says most of the company's investments have been profitable.
Copyright © 2009 Crain Communications, Inc.