Menlo Park R&D offices
- Renewable Energy,
- Energy Storage
R&D property owners generate $7.2M dollars in incremental cash flow and $2.1M in increased asset value by installing a $1M net, fully-managed energy microgrid
The Haven Avenue office park site is two sister R&D buildings located at the border of Redwood City and Menlo Park, CA. The ownership, after seeing the economic and environmental benefits of adding rooftop solar microgrids to their previous project, deployed the same strategy for the Haven Ave. buildings. In total, a new roof and 623 kW of rooftop and carport solar PV were installed while the buildings were fully occupied by tenants in long-term leases.
Benefits to the Owner
Beyond the project incentives totaling $2.95M (representing 75% of the gross project cost), the landlord generates $0.47 /SF/mo. of free power without risk of increase or disruption to the tenant. As a result, the property is much more resilient to competition or a broader market downturn. The additional income results in a $2.1M asset value increase in the case of a future transaction.
A secondary owner benefit is that the building has been ‘future-proofed’ with energy infrastructure to accept more battery storage or tenant energy demand increases, including EV charging.
Benefits to the Tenant
The switch to on site renewable energy yielded many benefits, including long term stabilization of their variable and costly energy expenses. Under the terms of their new energy lease with the landlord, they received a 5% discount on the electricity and were locked in at a 5% annual rate increase (for comparison, PG&E rates jumped 20% in 2022). The tenants also saw value in the fact that the solar powered electricity is buffered with battery backup so the tenants can continue to run experiments and mission critical operations during utility interruptions.
Additionally, the system generates almost 1M kilowatt hours of energy per year, representing 500,000 pounds of CO2 emissions annually. Using carbon free energy, the tenants are able to greatly reduce the carbon footprints of their products and services, achieving their ESG goals and customer expectations.