Green building businesses struggling

The good news is that sustainable or "green" home construction and remodeling — and the businesses making it possible — have been growing in Sacramento.

The bad news is that the recession and other factors are making it hard for those businesses to stay afloat.

Fledgling businesses that have taken off only within the last few years during a recent green building movement are being threatened by the virtual shutdown of housing projects and a lack of widespread support for ecologically friendly building materials. Businesses like Green Sacramento and GreenBuilt Construction also are suffering due to other types of income loss.

"The economy is just taking its toll," said Green Sacramento’s owner Josh Daniels. "As the housing market started to fall and as the economy started to back down, a lot of people began to see green as a luxury."

Certainly, the use of natural or environmentally friendly building materials is nothing new. Cultures throughout the world have made use of readily available materials to build and furnish homes throughout history. American settlers made homes of sod, clay or straw bales.

Mass production of construction materials in the 1950s made environmentally sustainable materials lose widespread popularity. A movement back to green building began on the West Coast in the 1960s. The movement continued to grow in the 1970s and eventually began gaining acceptance. In Sacramento, for instance, architects at Mogavero Notestine Associates, 2012 K St., started designing passive solar houses in 1979.

The nonprofit U.S. Green Building Council (GBC) introduced a pilot set of green building standards in 2000 and now oversees green building certification through its Leadership in Energy and Environmental Design (LEED) program. The program’s establishment has done much to increase green building in this country, although the focus has been on commercial construction until recently.

Sacramento now has one of the world’s largest portfolios of LEED-certified commercial projects, but environmentally conscious residential projects have not caught on here.

"I wish I could say that everybody is doing this; it is not yet the case," said Mogavero Notestine architect Renner Johnston, president of the Sacramento Chapter of the U.S. Green Building Council (GBC) that oversees green building certification for LEED.

"In the commercial realm, we’re pretty much there," he said. "Now the question is, how do we make that happen in the residential realm? To get the big builders on track with doing LEED for Homes has certainly been a challenge, but it’s partly because it’s a new process."

In spring 2008, San Francisco Bay Area developer Jeremey Drucker completed the "9 on F" townhouses in Alkali Flats. The townhouses are the first LEED-certified residential project in the central city.

The green movement and Al Gore’s 2006 movie, "An Inconvenient Truth," have helped bring environmental consciousness to the mainstream. Now homeowners are beginning to insist on green building materials in new home construction.

But the green movement has to be supported by everyone in the chain, from government officials, private investors and architects to contractors, homeowners and insurers, Johnston added.

The GBC launched the pilot LEED for Homes certification program in 2005, about the same time that two of Sacramento’s newest green building companies started.

Daniels studied eco-dwelling as part of a program on culture, ecology and sustainable living at New College of California. He then moved to Sacramento and remodeled his house. The difficulties he encountered trying to find people knowledgeable about healthy and sustainable products and to find the products spurred him to open his environmentally conscious building materials store in 2005.

The store was located in the Arden-Arcade area for three years. Business was going so well, growing about 25 percent in sales each year, that Daniels moved his store to 1931 H St.

"When we started, it was at the beginning of a movement for green building products in the residential market," Daniels said, 37. Soon, "the idea of green building went from radical and on the fringe to at least accepted and interesting to people pretty much across the board."

Unfortunately, the city’s planning and building departments took four months to okay his permits. The permits cost $5,000, although very little changes were made to the building. Daniels said the $10,000 he had to pay for double rent almost killed the business as he waited to move into the new space in April 2008.

Shortly after, the housing market and economy really nosedived. Paying $1,400 a month in increased rent for the Midtown location, Green Sacramento held even in 2008. But fewer people are buying now, so business has dropped 20 percent this year. A similar store named Casa Verde that opened more recently in Davis took 10 percent of his business.

To weather the financial storm, Daniels must get rid of his inventory of mostly finish products: materials ranging from high-quality, durable, non-toxic paints and paint colorant systems free of volatile organic compounds to Forest Stewardship Council-certified wood cabinetry and 100 percent-recycled glass tiles. Most of the business’ cash is in inventory, so he’s holding a summer sale that he hopes will help keep his store open.

As the only store of its kind in the city, Green Sacramento’s closure would be a blow to green building and remodeling in Sacramento. Before the store opened, builders, contractors and homeowners had to go to the Bay Area or buy products unseen and untested over the internet.

Daniels has also gotten creative about subleasing sections of the building after GreenBuilt Construction moved out due to the economy.

The environmentally sustainable contracting company owned by Daniels’ friend, Scott Blunk, hasn’t been as lucky during the recession. He opened his remodeling and retrofitting business (initially called Green Tree Homes) at the same time that Green Sacramento began. His business grew by 200 percent each year.

In January, a lot of people cancelled projects. Other people want to go green but ended up not doing it, partly due to cost for some products, he said. Blunk had to lay off his entire five-person staff in February.

"All my employees would show up for work even though they knew they wouldn’t get paid — for months. It shows how dedicated a staff I had," said Blunk, 40.

"I haven’t been able to pay myself since February. Essentially, I’ve been laid off, too. But I’m still showing up for work," he said. "I don’t know what else to do. It’s going to come back."

Blunk got into green remodeling work while getting his Ph.D. in economics at the University of California, Davis. He started buying and fixing up homes because "that paid a lot better than TAing," or working as a teacher’s assistant.

Now he’s a LEED-accredited professional, but Blunk will soon become one of about 70 people across the country certified by the GBC as LEED faculty. Then, he’ll teach green building workshops throughout California, the West Coast and Hawaii.

To keep his business going, Blunk moved back into a home office, then recently merged with Treasure Homes in Folsom. He and Treasure Homes are currently working on a model green home project for the Sacramento Municipal Utility District. The four-bedroom, two-bath California ranch house will demonstrate green technologies, including energy systems, appliances and some materials, when it opens to the public in August.

Daniels and Blunk both have green remodeling experience and knowledge that is hard to find in Sacramento, Johnston said. Most people selling green building supplies don’t know anything about the products. And most contractors are just now trying to learn how to build sustainably, he added.

That expertise will be in demand again if they can survive the recession.

"Everybody talks about green and knows about green now," Johnston said. "Few of them really understand what green is. But they know they want it and they want to do what’s good for themselves and the environment."

Suzanne Hurt is a staff reporter for The Sacramento Press. She can be reached at 804-2856 or suzanne@sacramentopress.com.

Conversation Express your views, debate, and be heard with those in your area closest to the issue. RSS Feed

July 9, 2009 | 7:47 PM

“the city’s planning and building departments took four months to okay his permits. The permits cost $5,000, although very little changes were made to the building.”

Wow!!! What happened Planning and Development Department manager, city manager and Development Oversight Commission?? You’ve been blaming neighborhood folks for all the delays and adding costs to the applicants!!!! You were brought down here from Portland to get those pesky neighbors out of the way in order to approve these projects like greased lightning, and you’ve been working very hard at that. BUT neighbors weren’t involved in this one, so what is your excuse for bumbling this one so badly and costing him so much???

Oh yes, and obviously this applicant received no approval for fee postponement or waivers like the controversy swirling at council over the big developer fees was about?

Could it be that the applicant was not a big name wealthy developer and could not afford to wine and dine in grand style? Daniels might want to know that he is not the only small businessman to experience permit delays and high costs. I know of a neighbor just a couple of blocks away who went through the same expensive delay process.

July 10, 2009 | 4:03 PM

Do you think the cost and delays could have anything to do with the 35+ employees (mostly planners) that have been laid off in the last 2 years? It seems to reason that when you have fewer people to do a job, money talks.

July 10, 2009 | 7:22 PM

Possibly but the delay for small businesses and residents remodeling their properties has long been slow and costly and what’s worse, contradictory, with one staff person giving one set directions with another coming to check later and giving another set of directions. But current management makes sure the big developers get super-fast service–lack of staff or not.

July 11, 2009 | 8:48 PM

I see. I’m not really sure I understand the complexity of this specific issue, but it is unfortunate when a government institution lacks cohesion and consistency. We are certainly missing effective leadership on a grand scale all through government today. I wish we had better leadership and mentoring offered to government employees. But we as citizens don’t really think about how good leadership in local government could ultimately affect us. But that’s the big picture from the government point of view.

As a citizen and homeowner who pays regular taxes to my local government, I am definitely concerned when a fly-by-night big business gets favor over the local developer working on a small scale for citizens. Do I kinda get what you’re saying??

Leave a Reply