Panel Paper: Spatial Spillover On Signaling-Effect of LEED Certification

Saturday, November 9, 2013 : 8:20 AM
Plaza II (Ritz Carlton)

*Names in bold indicate Presenter

Lin-Han Chiang Hsieh1, Douglas Noonan2 and Daniel Matisoff1, (1)Georgia Institute of Technology, (2)Indiana University-Purdue University Indianapolis
The benefit of pursuing green building certification mainly comes from two aspects: the cost-effectiveness on energy efficiency, and the signaling consideration, including premium on property values, benefits from better reputation, morality values, or purely pride. By analyzing all new constructions that receive LEED certification from 2000 to 2012 (LEED-NC v2.0 to v2.2), this study tries to identify the size of signaling effect, as long as the spatial spillover of signaling, in the pursuit of LEED. The result shows that the signaling effect does affect the decision making in pursuing LEED certification, especially at scores around thresholds. The size of signaling effect differs among different owner types and different certificate level. For Gold level or below, government and non-profit-organization owners value signaling more than profit-seeking firms. At Platinum level, there is no significant difference among owner types. Also, this study finds that the signaling effect clusters spatially for government and profit-seeking firms. Finally, the result shows that the cluster of signaling is independent from the cluster of LEED buildings, indicating that mechanisms behind the cluster of signaling is different that of LEED constructions.