- Richard M. Gatto
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How Electronic Vehicles (EV) Are Presenting New Opportunities for CRE
Electric vehicles, or EV, are quickly becoming more and more popular across the United States with 2016 seeing a whopping 25% increase in EV sales from the previous year. Today, more than 360,000 EVs are on the road.
Every major car manufacturer now offers an EV, and there are more than 26 different models from over a dozen brands to choose from. There are several reasons why consumers are showing more interest in electric: growing concern for preserving the environment and preventing further global climate change, the allure of glamorous new models from renowned brands like Tesla, and the cost-saving benefits of a fuel-efficient car. However, one of the more unexpected results of EV is the effect it is having on the commercial real estate landscape.
Though nearly half of all EV sales in 2016 were in the state of California, this market serves as a model for other locations across the U.S. as the EV trend continues to expand. As more drivers switch to EV, there is an increasing need for charging stations at offices and business parks as well as at home and retail centers. This puts the pressure on real estate developers to provide these amenities on their properties, in order to show that they are up-to-date on new technology and that they cater to this growing sector of the workforce.
Because of this, the most highly-valued office spaces now exhibit many new charging stations to accommodate electric vehicles. There are a few different options that developers have for installing these types of stations on their properties. The first is to outright buy the charging stations and pay to have them installed, and then manage the stations themselves. This is the more cost-efficient option, but can be tricky if the stations need frequent maintenance. The second option is to contract with an outside company that specializes in providing charging stations. Though this option is generally more expensive, it can be worth it to have on-call specialists at the ready to deal with any issues or changes to the stations. Some companies also allow blended packages with various combinations of these two options.
Installing EV charging stations on CRE properties can facilitate valuable opportunities for developers in a couple of different ways. Market leader, ChargePoint, for example cites the many benefits of EV stations within master-planned properties: attracting and retaining tenants, increasing property value, meeting emerging state and city regulations, future-proofing your property, and establishing your brand as a green leader.
Another benefit that EV charging stations bring to commercial properties is that they require a certain amount of time to actually use. The average EV takes around thirty minutes to completely charge up, allowing plenty of time for drivers to explore their surroundings and enter businesses in the vicinity. This is an especially valuable opportunity for retail centers and for offices seeking new tenants. Again, here’s how ChargePoint puts it: “EV drivers choose their destinations based on the availability of EV charging from their preferred network—and they tend to base their shopping routines on those destinations, so they can charge the car while they shop and dine. EV charging helps your tenants attract new customers, and build a steady revenue stream from repeat buyers with higher spending capacity.”
Sustainability and environmentally-conscious initiatives in real estate development are more important than ever, and EV is one of the many ways that these types of values are changing the look of CRE.