During the building process of the 132-room Gold LEED-certified GAIA Napa Valley, owner Wen-I Chang went through three redesigns and signed 87 change orders. “Everybody is in a long learning curve,” he says—so long, in fact, that he considered aborting the project. “If you want a green building and a green operation, you cannot be short-sighted.”

Yes, obstacles are still constricting the eco-designed pipeline. Price is one. The initial quote for “green” materials that would replace a blacktop “heat island” at the GAIA Napa Valley was about 25% over the standard product. “By the time we went to bid, it was more than double,” Chang says. Solar panels that “experts” said would pay for themselves in three to seven years are more likely to take 10 to 13 to deliver payback. Was it worth it? “Yes. An independent hotel can recapture some of the investment in five years and amortize the rest over the next five,” Chang says. “Then, for the next 30 years, you’re home free.”

Robert Katz, CEO, Vail Resorts, Avon, Colorado, sees the cost differential for green beginning to decrease, especially as more architects, designers and hotel brands add LEED-certified staff members. Katz will add to the industry’s learning curve as work progresses on Every Vail, a US$1billion project slated to open in 2010 that will house a sustainable pedestrian village with residences, a hotel, offices, retail, mountain operations facilities, parking garage, gondola and related skier portal, and a public park. It is one of the first to be accepted into the U.S. Green Building Council’s new LEED for Neighborhood Development certification program.

“The key to green building is to commit early in the process,” Katz says. “Then, green doesn’t add anything to the schedule. If you make (green) decisions halfway through, you’re in trouble.”

Government mandates are starting to make “green” more attractive for developers. Building the US$23 million Fairfield Inn & Suites by Marriott-Inner Harbor at Historic Brewers’ Park to LEED certification standards “was one way of complying” with ordinances covering development along the bay in Baltimore, says Gene Singleton, president of Summit Associates, Raleigh, a long-time Marriott franchisee. Singleton is working alongside Marriott’s team to navigate LEED’s “complex matrix of criteria” and streamline procedures as the hotel moves forward toward its 2009 opening.

At this point, building to certification standards will add about US$300,000 to US$400,000 to the project cost and no additional time. “We think we can get as much as two points in additional occupancy and one-half percent of additional rate from being green. That would generate payback on our LEED investment in three years,” Singleton says.

As costs come down, companies such as Sage Hospitality Resources, Denver, are making green standards work for conversions. Sage’s transformation of the nine upper stories of Portland’s historic Meier & Frank department store into the 331-room, LEED Silver Certified The Nines will use 26% less energy than code and 33% less water than baseline requirements when it opens this summer.

“The Nines will be the preferred hotel for this segment of market demand,” says Ken Geist, Sage’s executive vice president.

Whatever the challenges, green certification is gaining importance in terms of complying with brand standards and customer mandates. But caveats are necessary. “Certification standards need to be customized to hotels,” says Lyndall DeMarco, executive director, International Tourism Partnership, a program of the International Business Leaders Forum, London. “They are more complex operations that other types of asset classes. Before owners and developers [decide], they have to ask why they’re doing it.”