Cornell Study Finds LEED Certification Boosts Hotel Revenue

A new study from Cornell University has found

that hotels gain a revenue benefit when they are certified under

the LEED sustainable building program.

By comparing LEED certified

hotels with a competitive set of non-certified hotels, the study

found substantial increases in ADR and RevPAR for the LEED hotels.

The study, “The Impact of LEED

Certification on Hotel Performance” by Matthew Walsman, Rohit Verma, and Suresh Muthulingam,

is available at no charge from the Cornell Center for Hospitality

Research (CHR) at the School of Hotel Administration.

“The hotel industry has embraced environmental

sustainability and several hotels have registered for or earned

“green” certification under the LEED program,” said Verma, who is

the Singapore Tourism Board Distinguished Professor at the School

of Hotel Administration. “But LEED, which stands for Leadership in

Energy and Environmental Design, is really aimed at controlling costs by limiting resource use. So, the question was whether there

also is a revenue benefit from LEED. We found that the answer is,

absolutely yes.”

The study compared the performance 93

LEED-certified U.S. hotels (the number for which operating data

were available) to that of 514 comparable competitors, and found

that the certified hotels obtained superior financial performance.

The authors completed this report by analyzing comprehensive hotel

performance data provided by STR, a Partner of the Center for

Hospitality Research.

Walsman, a doctoral candidate in Service

Operations Management at the School of Hotel Administration,

pointed out that many of the hotels had only recently been

certified, so the study could compare their revenue experience for

a period of just two years.

“We’ll have many more hotels to study

in the future,” he said, “since companies like Marriott have now

included LEED as part of their own design specifications for new

constructions.”

The researchers found that the revenue

benefit applied in hotels of all types, although most hotels in

the study were upscale or luxury properties located in urban or

suburban locations.

“This makes sense, because many of the LEED

standards involve a hotel’s connection to public transit or other

resources typical of urban areas,” Verma added.

Developed

by the United States Green Building Council in 2000, the LEED

certification process gives commercial buildings a scorecard for

meeting standards relating to such areas as location and

transportation, materials and resources, and water efficiency,

among others. The more points under the program, the higher the

certification level. Although the initial LEED standards were not

directly aimed at hotels, numerous hotel properties nevertheless

have earned certification. The most recent version of the LEED

standards specifically include hotels, along with other commercial

buildings.

See other recent news regarding:
Interviews,
Pictures,
Videos,

Cornell,


LEED,


Green,


ADR,


RevPAR

Cornell Study Finds LEED Certification Boosts Hotel Revenue