Rubicon Point Partners Lowers Electricity Bills For Tenants Amidst Spiking Power Prices
With Gridium’s energy analytics platform and deep experience helping clients navigate PG&E’s On-Bill Financing Program, Rubicon pushed through $1.5M in building improvements with zero capital expenditure
Rubicon Point Partners are among one of the first real estate investment firms to adopt innovative sustainability strategies, ranging from energy performance management with Gridium to putting beehives on their properties’ roofs. Now with over 13 office and mixed-use properties under management across the San Francisco Bay Area and Pacific Northwest, Rubicon is transforming commercial properties for the future of its tenants, investors, and cities alike.
| Building Type(s) | Multi-tenant, mixed-use office |
|---|---|
| Location(s) | Oakland and San Jose, CA |
| Estimated Annual Savings | $128,000 |
| Estimated Payback | 8.5 years |
Challenge
For the Market Square Towers in downtown San Jose and the Rotunda Building in the heart of Oakland, respectively, that meant investing in significant renovations. Market Square is comprised of two 1960’s office buildings with a courtyard between them, totaling just over 325,000SF one block from the bustling San Pedro Square Market. The Rotunda Building is a 300,000SF downtown Oakland icon dating back to 1913 that today houses a diverse mix of businesses including legal, medical, and nonprofit tenants.
“We are trying to be a different kind of real estate sponsor: one that’s built for the next hundred years, not the last hundred years.”
Rubicon is doing more than just ensuring these buildings offer tenants outstanding options for office space, meeting, exercise, and relaxation, they’re ensuring these buildings run at peak efficiency. “Outside of labor and real estate taxes, energy is our biggest cost across the portfolio,” explains Sara de la Riva, Rubicon’s Director of Property Management. De la Riva has been at the vanguard of CRE community engagement for years. A member of several community benefits district (CBD) boards around the Bay Area and president of the Oakland Uptown CBD, de la Riva knows how much rising energy costs are hurting tenants.
Since 2020 she’s been championing Gridium across the Rubicon portfolio to surface efficiency opportunities and drive down costs. “Our staff is constantly looking at weekly Gridium reports and our energy use data in Gridium to dial back and save,” said de la Riva.
With the Gridium platform, the facilities management team at Market Square has been able to lower electricity bills by a couple thousand dollars per month just by pushing back start times. But that’s just the tip of the iceberg. “Because we’re seeing skyrocketing costs everywhere, we’re hyper-focused on being as lean as possible,” notes de la Riva. So when Gridium came to Rubicon with an opportunity to achieve even deeper energy efficiency savings through its no-CapEx project development and financing solution, de la Riva made sure the Rubicon team was all in.
111 Market Square in San Jose, CA
Approach
Gridium helped Rubicon apply for and secure $1.5M in LED lighting retrofits, ultra-efficient boiler retrofits, pump efficiency improvements and digital controls for parts of the HVAC system at Market Square and the Rotunda Building through PG&E’s On-Bill Financing Program. The program finances energy efficiency upgrades for property owners like Rubicon, then recuperates costs through payments added to monthly electricity bills. “In a time where financing is difficult, to be able to do the on-bill financing was a no-brainer,” said de la Riva.
In Rubicon’s full-service gross leases, tenants pay for a share of the electricity they use, so the firm wanted to make sure these upgrades wouldn’t end up costing tenants. Working with partner NuWave Energy Solutions, Gridium helped design the projects to be cost-neutral for tenants, worked with the contractors on pricing, and modeled the financing for Rubicon.
Once PG&E approved the projects, Gridium acted as Rubicon’s representative with project contractors to ensure the projects were executed successfully. And upon project completion, the Gridium platform gave the Rubicon team invaluable access to before-and-after electricity usage data across both properties, so they could accurately measure and verify the savings from the project upgrades.
“We love this program because these energy efficiency improvements pay for themselves. The On-Bill Repayments are less than or equal to the energy savings we achieve, so we can undertake these upgrades without us or our tenants coming out of pocket. And once the financing is paid back, we are able to enjoy the benefits of that operating expense savings without offset. Projects that are both good for the environment and make sense economically are the best of both worlds.”
The Rotunda Building, Oakland, CA
Results
The upgrades, which were fully managed by the Gridium team and financed by PG&E’s On-Bill Financing Program, were a win all the way around for Rubicon: a lower carbon footprint, reduced operating expense, higher asset values, and no new capital expenditures. And Gridium’s data-rich and user-friendly platform has helped Rubicon showcase the project’s success to their investors.
“Gridium’s reporting has helped us demonstrate that we’re an environmentally conscious company trying to reduce our carbon footprint while saving on the bottom line,” explained Roland Pan, Senior Managing Director of Innovation, Research & Strategy.
The best part: even with 20-25% increases in electricity costs, Rubicon’s electricity bills have gone down at the project site since completion. That means tenants are paying less per month, and when the PG&E project financing is fully paid back, those bills will go down even further.