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The Future of Sustainability in NYC

Jul 20, 2023

Look into Local Law 97 and Its Implications for Building Owners and Managers

In this webinar, the speakers addressed Local Law 97 including the overview of the law, how emissions will be measured, strategies to achieve compliance, penalties for noncompliance, best practices for reporting, timeline for implementation, and legacy leases.


Amy Menist:Thank you, German, and thank you to the marketing team for helping us put this webinar together today. So hello everyone. Welcome to today's webinar, The Future of Sustainability in New York City, where we will be addressing Local Law 97 and its implications for building owners and managers.

As mentioned before, my name is Amy Menist. I'm a senior auditor with EisnerAmper's Real Estate Services Group. As commented, feel free to ask questions in the comments throughout the session, and we'll try to address them during our Q&A.

So I'd like to start out by emphasizing that the real estate sector is currently under scrutiny for being one of the leading contributors to greenhouse gas emissions. Currently, the total greenhouse gas emissions attributed to the construction and operation of real estate account for almost 40% of total global greenhouse gas emissions, outweighing both the transportation and the industrial industries.

Additionally, the real estate industry consumes over 40% of global energy annually. As a result, New York City has elected to implement Local Law 97 to improve energy efficiency and limit greenhouse gas emissions.

So joining me today to explain Local Law 97 is our panel of experts, including Charles with EisnerAmper, as well as Anthony Bonan, a partner at Hunton Andrews Kurth, and Lisa Grayson Zygmunt, a manager at New York City Accelerator Program.

So before we get started, I'd like to have each of our panelists briefly introduce themselves. So let's start with Lisa. Lisa, would you mind giving the viewer some background on yourself?

Lisa Grayson Zygmunt:Sure. Thank you, Amy. I am the outreach manager for the New York City Accelerator. I've been with the program for about two and a half years. Prior to that, I served in two different utility programs as outreach and program manager.

My earlier professional work was really focused around sustainability in green building and worked many years with the US Green Building Council, helping launch, lead a number of other green building and sustainability programs. I'll turn it back to you, Amy. Thank you.

Amy Menist:Perfect. Thank you so much, Lisa. And now you, Anthony?

Anthony Bonan:Sure. I am an attorney. I'm a partner in the New York Real Estate Practice Group at Hunton Andrews Kurth. I represent owners, operators, developers, and capital partners on all transaction types, including acquisitions, dispositions, financings, and JVs. I also do a fair bit of office and retail leasing, which is the area of my practice that's most impacted by Local Law 97 and what we're going to be talking about today.

Amy Menist:Fantastic. Thank you for sharing, Anthony. And now, Charles.

R. Charles Waring:Thanks, Amy. Charles Waring. I'm a partner at EisnerAmper here. I'm in our ESG practice, but have been in the space for about two and a half, three years. I'm an auditor by trade, so I approach the ESG discussions and the compliance-related discussions from more of that perspective. But happy to be a part of our conversation today.

Amy Menist:Fantastic. Thank you. All right. So while the demand for real estate continues to grow, the need for environmentally conscious efforts and sustainable innovation have become ever more prevalent. So one way that New York City is making strides towards a more sustainable future is with this implementation of Local Law 97 and efforts to achieve the city's carbon reduction goals. So, Lisa, could you please explain for our viewers what Local Law 97 is and who it does and doesn't apply to?

Lisa Grayson Zygmunt:Sure. LL97 is part of New York's Climate Mobilization Act. The CMA is the largest climate solution put forth by any city enrolled. It consists of a slate of climate laws designed to dramatically cut carbon in New York City. Central to the CMA is Local Law 97, as you noted. First-of-a-kind legislation placing emission limits on New York City's largest building that are privately owned, multifamily, and commercial over 5,000 square feet.

So there are some other smaller nuances where there may be two or more buildings owned by the same condo association that exceed 50,000 square feet. But again that's the general compliance category.

Amy Menist:Great. Okay. So with that being said then, what is the timeline? When is Local Law 97 set to take effect and what's the overall goal? Oh, wait, hold on one second. Lisa, you might be a little bit ... Are you muted?

Lisa Grayson Zygmunt:I am. I put myself on mute. Apologies.

Amy Menist:Oh, my apologies.

Lisa Grayson Zygmunt:So let me start again. It was my fault.

Amy Menist:Great. Thank you.

Lisa Grayson Zygmunt:No, no, no, my fault. I took myself off. So the first carbon emission limits will start in 2024 and run through 2029. They ratchet down again in 2030 to 2034, and then they'll ratchet again. So it's a progression of lowering the emission threshold.

As we're looking at the 2024 timeframe, about 70% to 80% of the buildings impacted by LL97 are already in compliance. So it's a small percentage that are going to be affected this first time around. But as we head into the next tier of the 2030 to 2034 period, it flips, and 70% to 80% will be out of compliance at that timeframe.

Amy Menist:Okay. So with that said then, how are the penalties actually going to be calculated?

Lisa Grayson Zygmunt:So the penalties are calculated based on actual emissions that are compared to the target emissions for the building type. The building type has just been transitioned to the Energy Star portfolio categories of building types, and there's an algorithm that will look at the building size and type, and then set that limit, measure, take your actual emissions, compare it to the target emissions, and the difference, the delta is what the penalty is calculated on. So if you are ... It's based on metric tons. So the fee is at $268 per metric ton that you're exceeding the limit.

Amy Menist:Very interesting. I could definitely see how this might be an incentive and work towards the city's carbon reduction goals.

Lisa Grayson Zygmunt:Absolutely.

Amy Menist:Now, Charles, how would a property owner identify how emissions will be measured and assessed?

R. Charles Waring:Right. So I think that the first piece is understanding what is their primary source of energy use? So is it coming from electricity, natural gas, oil, or steam? Understanding that is ... It sounds simplistic, but it's important components for a property to understand. If you're unsure, that's the first piece to start with.

The second aspect is understanding how that is being measured. The key thing there is getting accurate data from ... Now oftentimes this is coming from your utility provider, but it needs to be obtained ... Sometimes this stuff is ... Depending on the level of sophistication of all parties involved, it's something that can easily flow in through systems or through collections there. But it's an important aspect to gather that information, have that accessible, review it, understand it, and having that ... If there's any questions around is that complete, is it accurate, those are the things that need to be obtained first and foremost.

So they sound basic, as basic steps, but we find that for many companies, many owners that haven't necessarily gone through that process before, it's not something that is easily performed on an initial offset.

Amy Menist:Right. Very interesting. Now, Lisa, is there anything you want to contribute to Charles's remark?

Lisa Grayson Zygmunt:Yes. So the baseline ... And what Charles said is absolutely correct. You've got to start with good data. Fines are based on benchmarking data that is reported on your LL87 and 84 reports. So buildings are required to benchmark. That benchmarking data is used to calculate the fine. So, again, vitally important that the data that you're reporting is accurate.

Amy Menist:True. So with that said then, Lisa, then, what are some strategies that real estate owners and managers could implement to reduce their emissions?

Lisa Grayson Zygmunt:Well, shameless plug here, I'm going to suggest that they contact the Accelerator. We will work with them to start at the very beginning with that benchmarking data and review it again, making sure the data, the inputs, the starting point is correct.

Depending on the size of your building and your systems, you may want to have a study done. There are a number of different types of studies that are available. NYSERDA offers cost share on a lot of these audits and studies. So understanding your starting point is very important.

Then start with low-hanging fruit. A lot of times just starting with some very basic energy improvements will get you over that threshold and get you into compliance. So it's really understanding how far is your reach, how far do you have to move the needle to get into compliance?

So start with the low-hanging fruit. There's a lot of things that are free and there are a lot of things that are very low cost, and retro-commissioning, make sure your systems are working as they should. So going through that retro-commissioning process.

Then develop a long-term plan. We work with buildings to help them phase it and understand what they should start with, how they should phase it, and connect them with the service providers that can offer those services, as well as connecting them with the financing options and providers to find the best fit to pay for those upgrade.

So there's a lot that can be done. We don't want building owners and managers to feel overwhelmed. There's a process, there's a system, and there's a timeline that can be developed to get them where they need to be.

Amy Menist:Perfect. Well you keep saying the word compliance and that's really ringing some bells in my ears. So actually, Anthony, what are the benefits to achieving compliance? Oh, Anthony, you might be on mute as well.

Anthony Bonan:Is that better?

Amy Menist:Much better. Thank you.

Anthony Bonan:Okay, thanks. Sure. In the context of leasing, the problem with Local Law 97 is that it's imposing a cost on the landlord that's significantly affected by how the space is being used by the tenant as the end user. So it makes sense that landlords are trying to look to pass along these costs to the tenant in order to incentivize the tenant to cut down on their emissions, whether it's electric use or something else.

That is what you're seeing today in a lot of leases. Landlords are adding provisions to their leases that require tenants to pay fines that Local Law 97 imposes due to the tenant in using their space exceeding an allocated share of that building's carbon emissions limits.

They're also looking to have the tenants pay their share through operating expense provisions of any fines that Local Law 97 is imposing on the building for the building systems and the common areas exceeding, again, an allocated share of the building's carbon emission limits. Finally, they're looking to pass along to the tenants the tenant's share of costs of capital improvements that the landlord's making in order to comply with Local Law 97.

So the problem is that your average tenant, or even a sophisticated tenant with a dedicated operations team, typically isn't going to really know how to evaluate that risk, how big that cost is going to be. So if you have a landlord who's upgraded their building and is confident that the building is going to hit the Local Law 97 carbon emission limits without having to affect the way that their tenants are using the space, that landlord can take that issue off the table for their tenant by not asking to pass along those costs to the tenant.

I think removing that unknown risk for a tenant is giving those landlords in these updated buildings a real competitive edge in leasing their space.

Amy Menist:Interesting. Okay. Charles, is there actually anything that you want to contribute to that?

R. Charles Waring:You know what? The one thing I always look at, there's always an aspect of compliance. Not incurring the fines, not incurring the penalties, meaning those reporting requirements, but trying to look at it from a strategic benefit is always something that should be considered here.

So from a standpoint of managing that and looking to speak to how the property is demonstrating and enhancing those emissions reductions, how that's being treated with the tenants and the setup there. But, overall, just ...

I mean the other component is what we don't necessarily know is to what extent that there's going to be noncompliance. One of the things is sitting there and saying, well, you know what, this is something that we're demonstrating that we're looking to be a leader in the market, in the community, and we're really trying to leverage this as a strategic component with us, not just a compliance check-the-box, not incur or incur the fine, but it's an important aspect there.

So that's the other component that I always like to mention when we're talking about compliance versus incorporating that into a strategic advantage there.

Amy Menist:Okay. So then, in addition to the fines and penalties, are there any other downfalls for noncompliance in addition with, I guess, what can be said as far as reputation and being able to bill tenant? Lisa, do you want to weigh in on that?

Lisa Grayson Zygmunt:Yeah, I'll jump in. I mean I'm going to weigh in on the benefits of compliance can be greater than obviously those of noncompliance. As mentioned, increased property value, increased marketability of your asset, increased energy efficiencies of your systems, lower energy costs, improved tenant comfort and experience, and lower maintenance costs. So there are a slew of benefits that should be factored in.

Amy Menist:Good point. So, Charles, what are some best practices that real estate owners and managers could implement for ongoing monitoring and reporting?

R. Charles Waring:Sure. So what I would say, and this is probably a theme for my area, is, first and foremost, start early. I think that whenever we ... Regardless of the situation, when we're looking at a requirement that's out there, that can be seen as, you know what ... I mean the first milestone here is 2025, but then we're seeing that 2030 is when this might affect or have an effect. But some people, some organizations see that, hey, that's many years out and we'll worry about it the year or two beforehand.

That is one approach. I won't necessarily discount that, other than saying that I've seen it time and again that the longer a company waits, it's going to just, A, put more stress on that company and the personnel that are going through that process. But, B, it also tends to be more costly because, candidly, most companies are going to need help in this space, and it's not something, unless they've got the resources on staff, that they can undertake themselves.

So you're going to need that assistance, and looking for the right advisors or resources to do that, there's more availability earlier in the process than when you're going up against the deadline there. So really start early and to try to get the pieces that you need in place there.

The other component I would say is that you need to understand what are any operational changes that are going to happen with your property, whether you've got key tenants coming in, coming out, if there's already any enhancements that are in the plan there. So understand what are operational items that you might not necessarily think might be impacted with your emissions, but it's important to really understand that because that should be factored into what are your pieces as far as related to measuring your emissions, understanding what might or may not have impact there.

So the last thing I'll say is that understanding ... And obviously this is not going away. This is something that has been in the works for a while and it's going to be coming soon to many of the companies and buildings here. And so, this should be baked into and developed into a regular reporting process for you.

We mentioned earlier about obtaining and knowing and understanding your data and ensuring that you've got the right baseline there. As you go through a continuous reassessment, build that in as a regular reporting process here. If you're looking at a pure compliance check-the-box exercise, there's going to be no value from that obtained. So in order to meet the requirements, but then also get the most value out of that, if you develop a standardized reporting process, timeline, et cetera, understanding everything else that you have going on with your operations, with your organization, that will allow you to have the most value derived from this requirement here.

So that all said, just understand that, what does it mean, how is it going to impact you, and not waiting till the last minute are going to be the key components here for monitoring and measuring all the requirements here.

Amy Menist:Absolutely. I couldn't agree with you more. So now figuring out how to get started and developing a timeline could be crucial for effective implementation. So, Lisa, do you have any guidance on how real estate owners and managers could get started and develop an effective timeline for implementation?

Lisa Grayson Zygmunt:Yeah, absolutely. Every building, every project, every portfolio, it's different-

Amy Menist:Of course.

Lisa Grayson Zygmunt:... and they have different drivers. So, again, connecting the ... The Accelerator is a great first step. We'll connect you with the service providers, the consultants, the experts in the field that can help you as well. But, again, we can help you identify the steps and the stages that you should be taking.

So, again, just to reiterate, starting with the data, capturing the reporting is really important, and there are a lot of different platforms out there for you to track your data, your energy use, and all those reporting pieces. So utilizing the systems that you have that reporting to expand that base of data is going to be helpful in the long run for you to understand what your current picture looks like, but then able to track and monitor moving forward.

So for those larger properties, really strong data and energy management systems, building management systems reporting, and having that data available to reference and pull from is very helpful.

And, again, making sure that you're clear on what your building's objectives are and looking at what kind of changes or tenant changes or renovation, long-term capital planning that you're looking at, and factoring that into some of your decisions is going to be very important as well. And working closely obviously with your facilities department, and maintenance and upgrades, so that you can phase it in with already scheduled capital and maintenance ongoing work.

So, again, looking at where your building is, where you might be even in your mortgage cycle, because if you decide to refinance that building, that's an opportunity to factor in some of these upgrades.

Like I said, starting with the low-hanging fruit, the retro-commissioning, understanding what energy sources you're currently utilizing, looking at moving your systems that do ... Equipment and systems that can't ... Move it toward electrification, it does ... We're not going to be able to flip the switch and have all buildings electrified overnight, but there are steps that we can take along the way as we're upgrading to systems to start to transition toward more electric buildings and planning for that in your capital planning budgets.

Amy Menist:Right, absolutely. All right. So now, Anthony, I'm going to pass this over to you. Can you actually explain for our viewers how Local Law 97 might be treated under legacy leases?

Anthony Bonan:Yeah, happy to talk about that. The answer is that it really depends on what types of costs the landlord's trying to pass along to the tenant and what the language of the lease in question is.

So in terms of landlords trying to pass along fines or the purchase of carbon offsets ... So for fines, there are typically in leases provisions that require tenants to comply with law in the use of their space. So what does this mean in terms of a building-wide regulation that requires the building as a whole to comply with these carbon emission limits? I'm not sure, to be honest.

Can a landlord say, "Hey, tenant. You're not complying with the law in the use of your space because you're exceeding what I deem to be a reasonable allocation of these carbon emission limits to your space"? I think a landlord could claim that. I don't know if that's a winning argument at the end of the day or not, but I think it's certainly something a landlord could claim.

There are also, in leases, operating expense provisions. So I think a landlord could certainly, depending on the language of the lease, say, "Hey, these fines that I'm having to pay are an operating expense, an expense of operating my building," and, "Hey, tenant. You're supposed to pay your share of these fines."

Tenants often, in negotiating these provisions, they try to exclude exactly that, fines for a landlord's failure to comply with law. So it really depends on, again, what your lease says for the ability to pass along these fines.

If a landlord's buying carbon offsets in order to avoid these fines, that would be a different story under the operating expense provision. So if a tenant has negotiated an exclusion for the operating expense provision for incurring fines, that wouldn't apply to carbon offsets. That's something different. So a landlord may be able to pass along that cost where it may not be able to pass along the actual fine itself.

Finally, in terms of capital improvements that a landlord may elect to do to comply with Local Law 97, operating expense provisions may allow the landlord to pass along that expense. So that's something that's usually is typically very negotiated in a lease, in a sophisticated lease, and there are certain types of capital expenses that can get included in the operating expense that is passed along to the tenant.

There are exclusions in whether or not the ... In addition to whether or not a capital expense can get included or not, is how much of that capital expense can get included in each year. Typically, capital expenses that are includable in operating expense provisions are ... They're amortized over either the useful life of the operating expense or the amount of savings that it's expected to achieve in each year.

So at the end of the day, it really depends on, A, what type of expense the landlord's looking to pass along and, B, what the language of that lease is. I think there's going to be a lot of discussion and probably a lot of dispute, and maybe even litigation, over this in the coming years.

Amy Menist:Very interesting. Very true. Okay. Well, now I'd actually like to open this to discussion for our Q&A. I'd like to answer some questions that we've actually received during this session. So let's actually put this back to the audience.

So we actually did receive ... Oh, we've got a lot of questions, guys. So one question is ... Somebody's expressing a concern, and of course we can go into much further detail on a one-on-one conversation with this person after this call. But they were expressing concerns about the rules potentially changing after they've done work to actually invest in these carbon reduction ... Carbon emissions reduction acts, I should say. So their concern is that if the laws are going to change down the future, and if so, is there any insight on how they might continue to evolve or change? No?

Lisa Grayson Zygmunt:Well, I can jump in. I can't say they're going to change what ... The current status is that additional guidance is still being developed and to be released from DOB around the current regs. So I think that there may be a little bit of a wait and see, but the guidance is just that. It's about the details, the devil in the detail here, on how to report what level of implementation, what level of ... It's the nitty-gritty of what data needs to be reported and in what type of format.

So I know that many of us are eager for those guidelines to be released, and there may be additional tranches of guidance that will continue to be released. I don't know, none of us ... At least I can't predict whether the law will change. I don't think that there's any indication at this point that it will.

Amy Menist:Right. And if they do, it might just be about how we're actually disclosing or reporting for the initiatives.

Lisa Grayson Zygmunt:Yeah. I think it will continue to evolve as DOB evaluates different components of the program and what might be best to help buildings comply. I mean their goal is not to issue fines. Their goal is to have that money applied to reduction of carbon. So it's not in anyone's best interest to fine buildings, it's in everyone's best interest to figure out how to help buildings reduce carbon emissions.

Amy Menist:Right.

Lisa Grayson Zygmunt:And that's that.

Amy Menist:Great. Thank you, Lisa. So somebody else commented, what are some technologies that can be used to help actually reduce the energy? I'm actually going to build off of that, because in addition to reducing the energy, there are also technologies out there that help you collect the data and streamline your data so that you can continue to improve your efficiency for electricity. Is that correct?

Lisa Grayson Zygmunt:Right, absolutely. Data is powerful. If you've got building management systems, real-time management systems, you can see how your buildings are performing. If systems are not performing as they should, you can control setbacks. So you can do a lot in understanding ... If you have that data readily available, to understand where the energy's being used, where it might be misused, and identify opportunities for reduction, and/or it may even be used in an analytical way to say, "Hey, we've got a piece of equipment that's failing because it's not performing." You can catch that on these data systems.

But the array of measures that you can implement in your building are widespread, from simple things like converting to LEDs, add controls to all your lighting, insulation, air sealing, proper ventilation. So these are the lower hanging, more simple, less capital-intensive types of things.

Retro-commissioning, making sure the systems are working as they were intended, and then looking at upgrading the equipment. New models of equipment are much more efficient, and making sure that when you do replace equipment, you're looking at the energy efficiency levels of those, and they are rated. Whether it's air conditioning models or boilers, they're all rated in terms of energy efficiency. So really paying attention when you're replacing equipment, that you're looking at those energy efficiency levels.

Other things, replacement of windows, replacement and insulation of roofs. Then you can also add solar, which is a major ... We have a lot of interest in solar in the city. There are even more attractive incentives and tax abatements that are now out with IRA. Lots of money flowing into solar.

The city has made it easier to install solar with not as great of setbacks on the roofs, where they're looking at making it easier to use battery backup. So there are a lot of different approaches to reducing and transition to more renewable energy sources.

Amy Menist:Fantastic.

R. Charles Waring:Amy, can I just piggyback on one thing that Lisa mentioned?

Amy Menist:Absolutely, please.

R. Charles Waring:So I think that what some of my clients are ... I'd say most of my clients that have gone and implemented some sort of building monitoring or automation system have realized value and savings from those. I think that one of the components of ... Until you measure and monitor it, that there's an aspect of you don't know where you are or you stand. I think that all of those systems are developed in an approach that does realize value and savings in the near term.

There's also many systems that are coming out that are much more scaled. So it's not just for the biggest buildings and organizations there. There's more that are out there on the market. So I would encourage organizations if you don't have one or haven't recently revisited contemplating implementing a system that they take a look what's out there, because there's many that do offer and will have savings for the organization.

Amy Menist:Thank you. Now we also received a comment, and this is actually one that comes to my mind as well, is affordable housing. Are there any exemptions to this? This one viewer actually commented, "What about rent-regulated buildings that have a greater percentage of affordable units? If they comply with the measures, do they have to comply with greenhouse gas emission limits?" So are there any accommodations for those that are rent-regulated or affordable housing?

Lisa Grayson Zygmunt:Yes, there are. They have an alternate pathway that they can go either one way or the other. They can either demonstrate that they're in compliance with the 2030 levels or they can do the prescriptive pathway, which is implementing 13 ECMs in their buildings and be in compliance. So they do have an alternate pathway, and there are other subcategories that then also apply to certain years, target years for those compliance levels. So yes.

Amy Menist:Great, thank you. So somebody questioned ... And I don't know if we're all going to actually know the answer to this, but I'm going to ask anyway. "So if New York City meets its 2030 goals, how much carbon reduction will actually be achieved?" It's a very valid question. I think ... I don't know if there's a set goal in that regard as far as how many metric tons are actually reduced for carbon emissions. But I think we're all just on the path of trying to limit the scope. Am I correct, Lisa?

Lisa Grayson Zygmunt:Yeah, I don't have a number. That's a great question-

Amy Menist:Exactly.

Lisa Grayson Zygmunt:... but I don't have a great answer. So, yeah, percentage-wise, we're just saying a percentage, that the city's goal is a percentage reduction by 2030. I don't know what that equates to, but I'll put it on my to-find-out list.

Amy Menist:All right. So then with that actually being said, then what's the base year against carbon output is actually measured? Is there a base year per building-

Lisa Grayson Zygmunt:So-

Amy Menist:Yeah, go ahead, Lisa.

Lisa Grayson Zygmunt:

Yeah. Well, so the calculations will be based on your 2024 benchmarking. So that's basically the answer. So buildings will need to benchmark 2024. Those numbers will be used in the calculation to determine compliance status. For every metric ton exceeding, the $268 will apply, a fine.

Amy Menist:Thanks. So, Anthony-

Lisa Grayson Zygmunt:So this is the year. This is the year to take action, to make sure your energy -

Amy Menist:Your benchmark is on target.

Lisa Grayson Zygmunt:Yes, yes.

Amy Menist:Anthony, I'm actually going to direct this question to you, because you did briefly highlight on it, and I just want you to actually expand and elaborate a little bit. What about carbon credits and offsets?

Anthony Bonan:Well, my understanding is that, in addition to upgrading your building in order to actually achieve the carbon emission limits, as an alternative to paying fines, you can purchase offsets. I don't know how those are priced comparative to ... I don't know if one ton of offsets is going to be cheaper or more expensive than the fines on a ton of carbon emissions. But I know that that is an alternative pathway to achieving compliance, even though the building isn't actually complying.

Amy Menist:Fantastic. All right. Now these are all fantastic questions, and I apologize if there has been a question that we didn't get an opportunity to address. We will reconvene after this meeting and we will make sure to address to each of the individuals directly. But with that being said, before we end for the day, I'd love to give each of our panelists an opportunity to provide final closing remarks. So, Charles, let's start with you.

R. Charles Waring:So I'm going to go back to one of my original themes, it's just an aspect of starting early here. I've seen many instances, whether it's Local Law 97 or a plethora of other regulatory requirements, that the longer an organization takes to really start the process ... And I'm not saying you need to do everything right now, but just start to assess where you are. What does it mean to your organization and what are those additional things that need to be put in place to address compliance? Like I said before, realize strategic value around that. So start early, because it's only going to get harder and more expensive the later you wait.

Amy Menist:I completely agree with you. Absolutely. So with that said, Anthony, would you like to share some closing remarks?

Anthony Bonan:Sure, yeah. Building off what Charles said about starting early, I think in the context of leasing, if you're looking today to sign a 10 or even 15-year lease, this is something that's going to affect you during the term of your lease for sure, especially when we hit the 2030 mandates.

So in the context of leasing, I think this is something that should be negotiated early in the stages of the lease, at the term sheet stage. I've seen quite a few leases where this isn't addressed in the term sheet stage, and then it's just another business term that has to get nailed down during lease negotiations.

So if you're a tenant and you're looking to take space in a building, especially if it's an older building that is perhaps less energy-efficient, I think it's in your interest to hit this early on in negotiations, and so you're not taking on an expense that you're not anticipating as to whether this is going to be a landlord responsibility or a tenant responsibility.

Amy Menist:Absolutely. Lisa, would you like to share some closing comments?

Lisa Grayson Zygmunt:Sure. I think we have to realize that there is no quick fix, there's no silver bullet. We are on a journey that will continue to evolve with technology, with the greening of the grid. So I think every building owner and manager just needs to commit to the journey and to get on board to start understanding the data and the resources and the tools, and to embrace it because it's an inevitable direction that we're headed and that we needed to go in, and to really reach out to our program.

There are lots of great resources throughout the city, not just Accelerator. But we're a city-sponsored program put in place for this purpose to help building owners understand their compliance pathway and to receive free technical guidance and assistance on this journey.

So, again, our job is just to help you understand it, to help you prioritize it, and to connect you with the service providers, the tools, the resources, and the financing incentives available from the utilities and the state to make it happen in your buildings.

Amy Menist:Well, this has been a fantastic dialogue, very informative. I do want to express for our viewers that, to build off of what Lisa had commented, we do have available for everyone some takeaway resources. I know, Lisa, your New York City Accelerator is number one on that list. Then there's also the compliance regulations for the buildings and the codes with New York City, as well as we did highlight for you guys some of the public tools available for reviewing energy consumptions and patterns throughout New York City.

Of course, I do want to say, push that to the audience, that we do ... Thank you all for joining us in our discussion today. We'll be sending all of these resources to you in a follow-up email once this webinar is completed. A special thanks to our panelists.

Kindly note that this recording is going to be made available in the upcoming weeks. Feel free to reach out to myself or any of the panelists if you have any additional questions or if you want some assistance with implementing your carbon reduction and energy efficiency initiatives within your property.

So, again, this has been a very informative webinar, and I look forward to seeing how New York City develops towards a more sustainable future. Thank you again. Now I'm going to hand this back to German for closing remarks. 

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