The Evolution of Green Building Amenities: The Case of EV Charging Stations

Abstract

The adoption of electric vehicles (EVs) by consumers has been increasing over the past years. It raises the need for charging stations in locations where EVs can be charged between uses. Office, apartment, and retail properties represent such locations. If tenants are willing to pay a premium for the ability to charge EVs between uses, a sales price premium is expected for buildings with this green building feature. This study uses commercial real estate transaction data to investigate whether the sales price premium for EV charging stations 1) varies across property types, locations, and building sizes, and 2) is distinct from the sales price premium for green building certifications (LEED or EnergyStar). Results suggest that the presence of EV charging stations adds a premium to the sales prices of 1) office, 2) suburban, and 3) medium-sized properties. The premium for EV charging stations exists independently from the premium for LEED or EnergyStar certification. However, charging stations in combination with green building certifications do not add an additional sales price premium. The findings of this study have implications for the decisionmaking of commercial real estate investors and marketing strategy of EV infrastructure service providers.

Keywords:

• Commercial real estate
• electric vehicles
• car charging stations
• green building features
• asset pricing

Notes

1 Costar does not provide information on whether these car charging stations are free of charge to drivers or not.

2 For more information on the Costar location definitions, see https://www.costar.com/about/costar-glossary.

3 For a review, see Robinson and Sanderford (2016).

4 Note that the coefficient for EV in Table 2 is 0.16, which translates into (exp(0.16)-1) = 0.17.