so connecting it to the course so far we've been talking a lot about planet and environmental and reducing energy for the sake of saving the planet and what we are going to talk about today is not talking about outside the building but talking inside the building so how can we actually think about the strategies of investing in buildings that will improve the lives of people in the building like us and we will talk a little bit about this classroom we have a a sensor over there that is monitoring the air quality in this classroom so we will see how good the CR is with us uh in terms of the places that they put it um here is the some of the key uh formulas and key uh diagrams that CG always uses for for the lecture so here is one of the key things of the the business case for for green buildings is that the tenants are going to be better off in a in a green building than in a non- green building and mainly because of you have on the one side energy cost environmental damages but especially and I will show that this is the largest part of the buy because employees are going to be more productive healthier more comfortable and they're going to choose to be in those buildings and therefore their corporate tenants are going to make larger bits for those buildings that's sort of the theoretical link and then we are going to talk about whether that happens in the market or not and also not only today but also on Tuesday we see that is there talking on the corner is going to happen also we're going to analyze that decision in one specific building in New York and we are going to have a lot of discussions about under which conditions this will be holding and under which conditions this not will holding because we have here people from Latin America Europe us different parts of the United States Asia is not going to apply to every Market but the fundamentals are going to be there whether the market is going to appreciate it or not that's a different story but the core technology is going to work in the same way the core idea of the engineers behind the design of those building is going to be very similar into why they are going to promote air quality in the building why are they going to upgrade the uh the hbac system in a building and so forth so the the fundamentals are there and now the key question afterwards and we are going to discuss a little bit later is whether the market is going to be ready or not okay but today we are going to learn about the fundamentals so forth why is also important for the general sustainability in the real estate uh sector is that if you see the evolution of the certificates are going is that at the beginning they were mainly mainly focusing on uh um on saving energy reducing emissions and so forth actually at the very beginning only saving energy because there was not even the Kyoto Protocol back then but really saving energy reducing the energy cost it was the beginning of the energy crisis in the 1970s and 80s in the United States and Europe and so forth so that was the focus of of uh Green Building certification as we move towards uh H the present you see that Health starts to appear more and more and you see that it takes more a larger role in The Green Building certification and you even have since five years ago certifications that are specifically focusing on health and well-being in the building so you see that in the in the Green Building market and the Green Building sector the role of health is going up more and more especially since the covid-19 David tell me um just a question I guess sure are there studies like longitudinal or like discontinuity studies done on like whether people are do take less sick days yeah we'll we'll we'll show you later actually I did one I'm very proud of it UHD disertation and and the work of a lot of people so there is a actually you are in a very good City uh for health and wellbe in the build environment so you have me that's great uh but beyond me you have the Harvard School of Public Health you have Joe Allen and the in HBS you also have John mccomber they both wrote the book on healthy buildings they are very uh big into understanding what is the business case and what are the effects of buildings on human health it's quite a lot Ariel what are you talking about in the 1990s like to Sol uh yeah so that is something that was a rebound in the in the way that we understood sustainable buildings in a way well not actually it was I don't think that they were talking about sustainability but anyways in the 1970s and ' 80s H they were experiencing this very similar environment as what we are experiencing now with the energy prices very expensive because of uh International conflicts and so forth the price of oil went up by a lot and then out of the sudden you went from almost paying nothing for energy and wasting a lot of energy not only in cars but also in heating to being actually paying a painful price for every uh degree that you put up in the heating in the in the heating in the building so one of the things that the physicist and the engineers figure out is that hey you know what one of the most expensive things that you can that you need to do in a building is to bring fresh air from the outside because every time that you bring some fresh air from the outside you have to bring it to the temperature that people inside the building want to have uh that means bringing from uh 0 degrees Celsius to 20 or from 90 degrees uh Fahrenheit to uh 60 or 80s I don't know like a Fahrenheit is something that I still have to work on but let's say from the '90s to the 80s anyways that is one of the most expensive things that you need to do in a building so what do you do let's reduce the amount of air that you bring to the building that comes with reducing ventilation rates but it also comes with designing buildings that are practically bunkers where there is no filtration of air from the outside that is great for reducing energy consumption but it creates a lot of problems with air quality so that was when the term of sick building synr syndrome was coined where people will get into their offices and will get uh headaches and they will get a lot of problems that are just purely related to the place where they were working and not to say the risk of uh infectious diseases like covid and so forth where basically we are all sharing our air I'm throwing a lot of droplets of you on you guys so the only ones that are preventing you from breathing what I am excelling is are these guys there that are trying to sack there faster than you guys than your Banks can Brea in so all of these problems were happening in the 70s and the 80s there were a lot of problems in the office sector especially and that was something that we're trying to remediate afterwards all right and to understand the role of buildings you have to understand the role of environment on on our health we have people from all over the world I think that H things like we have a lot of environmental threats but I'm going to show you the two most prominent this is a satellite image of the level of air pollution all over the world you see that almost in any you can find your city here you can see that anywhere where there is a city almost there is a red spot that means that there is a high level of air pollution so it's almost like pollution is the shadow of of of humankind so because the way that we move we generate pollution the way that we hit our buildings we generate pollution so forth and and we are trying to remediate that but that is now the reality for all places in the world um so and and what you see is that W considers that as one of the largest threats actually uh as you put you see here 4.2 million ion premature deaths due to inhaling air pollution across the wall that comes because when you inhale uh these little particles that come out of the exhausts of buildings and power plants and so forth into your lung that damages your lungs that gets into your blood flow that also hurt your your uh cardiovascular system and ultimately and that's also something that uh we've been discovering for the last years and now is one of the most uh serious threats it gets into your brain and it affects your cognitive performance so all of those things are things that are out there and you guys have been breathing quite a bit of it already on the way home to here all right so that's one of the things that the building is trying to prevent and I will talk a little bit about it because the the air that we are breathing here is being brought up by These Guys these systems so it's not we are not breathing through a window or anything so this building is between us and those red things that you see there is between us and those cars that are polluting and so forth so all the time that we are spending here is actually a time that the building can reduce our exposure to those things and make us breathing healthier air that we will have outdoor in the at the door of the SI so the question there will be some of the strategies that we can do to make that air as healthier as possible that will come with investments in the HB system and so forth this is one of the key things especially in areas like California where you have got wildfires but also Beijing Delhi and so forth where there's a lot of focus on how do do you filter the air in a way that you reduce as much as possible the level of particles that people will breathe in so that's one the second one is temperature we are talking a lot about not throwing CO2 to the atmosphere but we know that if you throw CO2 to the atmosphere the the whole planet will warm up and the the amount of heat waves and so forth will increase uh there are a lot of studies too to show that the effect of heat on uh on human health and cold on human health and there is around 5 million premature death every year due to being exposed to extremely cold extremely warm weather so again one of the things that our weather our building is doing is that we are not exposed to the cold weather outdoor in uh in the Boston in the city of Boston today and being freezing there being sitting down but actually we are in a very comfortable rather even warm uh room here uh that is trying to make our temperature exposure better than it is out there so buildings the way that we are conceptualizing in this uh and there are way more things that we can think about it but today what we are going to conceptualize is buildings that are going to generate an environment that is better than out there that's how we are going to think so we are not thinking of building generating Problems by themselves that there is also some things related to materials and so forth but mainly the way that a lot of people are conceptualizing healthy buildings are buildings that are creating a better environment and it can also be creating a better physical environment so they will make you move more that you will be moving out there with different staircases and so forth but basically buildings are trying to make better off than out there that's the definition of a healthy building very lemon terms okay and this is important because if you think about your daily life and this is the the is an old survey but it's still like the survey that everyone quotes we spend 90% of the time indoors this is something that they did the surveys about across the the United States H to show how many people will where will people spend time in and you see that if you sum all the indoor places in their in their home their Factory or a bar or restaurant uh most of it happens to be indoors and in a building actually except for the for the vehicle part so 90% of our time our air our temperature our movements our light is shaped by a building giving the building a very big role in our lives and therefore giving the building a very big exante power to shape our health shape our well-being and so forth and indoors is not always so great not not in Europe not in the US so you see around 5% of people in the United States live on average in a in a house that needs uh certain work uh that can be moderate it can be severe but 5% of people that need to live in a place better than they are doing now if you go to the renters this will be doubl so one out of 10 renters will actually be living in a place that needs some work uh if you go to the low income renters that will be way more more so it will be 15% of the population will be there so if you especially dig into the subpopulations that will need more support and actually the ones that are probably suffering for the ER with the most severe health problems then this is actually worse than than the graph that you see for the entire population and the same for for Europe but we are going to talk about not uh not so much about the people that are uh about the buildings that make an six but we are going to talk about investment strategies that will actually try to promote health and make us healthier in a way all right so this is whole the whole lecture today how can we invest in a building to make it to make us healthier how can we actually think about the health implications of investing investing in any of those Technologies and this is important for both I know that the before the uh there was not a lot of reactions from the public sector but if you really look at the the amount of money that governments spend in health is around in a normal year for a lot of countries almost one out of uh 10 uh dollars that we generate goes to to pay in healthcare and to make us uh avoid from dying or or make us less sick than than we are basically a one out of 10 and if you see the what happened after covid you see that in places like the United States things get rock so it's a substantial amount of all the money that we generate in a country going to healthare and also from the um there are a lot of estimates of cost of unhealthy workers for for aiv sector this is one of the most famous articles from The harbard Business Review that estimate that one50 billion dollar per year in in the US sector office sector goes to pay ER workers that are not fully fit so they are going there with burnout problems they are going there with some physical problems and so forth they still earn the full salary because they show up in the office but they are not uh performing at it best and that goes back to things like the sick building syndrome where you know you make someone work in a place that make them miserable and then they therefore cannot exert the full potential and I will also show you that you know there are some things that you can think about compensating right like kind of oh I have low concentration but I stay extra hours so you know I bear the cost as an employee I I get some extra coffee and you know I still even if I feel a little bit DIY or whatever I'll just get the job done but when it comes to decision making when you when it comes to negotiations when it comes to being a boardroom and you need to make a sharp decision that cannot be compensated if you make a mad bad decision in an strategic meeting that is going to handt you for the rest of the quarter at least so if that is affected by the place where we are making those decision even at the very low margin you will see big consequences because these are big numbers right the 10 the 10% of the GDP of the United States is a big number so even if you do a 0.5% change on these number is going to be a big change for for um for the for the whole country the same for $150 billion for the US sector so we are we are going to be moving in those margins small impacts but hopefully credible but if you make a small impact in a big part of the pie is going to generate a big impact after all and that's different from the from the Energy Efficiency where utilities as we will show in the Inon statements from tenants utilit has to be relatively a small part but we can actually make a big impact with with energy efficient Investments but you need to make a big impact because otherwise it will not make a meaningful change in the in the income statements of of tenants but here it is you have a large set of the P it's very difficult to make even any small impact but if you do you have very big numbers that will actually make a very big impact after all when you compute that any Reflections ich yeah that's why the C we are committed to make this place a very healthy amen we are going to run away to this natural Hall to make them healthier understand the S exactly so if you want if you have any requests please send an email to CI with a nice sofa or something I already doing so yeah but after you graduate I must business but they you can always come you will anyways come for the commencement so imagine being here with a nice sofa and I think that would be nice great okay okay so now that we understand the science and what buildings do to inject what the environment makes to to us and sort of like the the prospects of of making a lot money let me go really into uh first the impact of of buildings or The Proven impact in the research of buildings on on human health by me but also by others uh and then also you know not only on the occupants and the people the users of those buildings but also how that scales up all the way to an investment valuable decision right so how the tenants will actually be able to pay for this or not and why would they pay so basically thinking about the accounting of those so my employees are healthier but that doesn't mean that I care uh but actually if that means money for me then I will care and I will actually make sure that I'm in the best office or that the that office is at the best performance that can be but then also of course talking about when you when we climb the leather also some uh barriers to adoption right so so even if we prove that these buildings make people healthier even if we prove that these build uh will make people more productive is this going to scale up to the final decision maker that is able to actually put the money to make that investment and we were talking before with with Willian about the fact that sometimes these split incentives are not easy to solve and we will have them here again and actually you will have a little bit more um a more complex flavor than even the Energy Efficiency for certain reasons so we need to understand both we need to understand what is the potential of this Investments but but we also need to understand very clearly what are the barriers and also start the conversation about what are the solutions so this is the the whole purpose of the conver of the uh of the conversation today and finally you know to to wrap up to connect to to the first two lectures of the course including also the the introductory lecture the three first lecture of the course connecting healthy and green and is there a trade-off or not and so forth and if we have time given the H projector part I can also give you a glimpse of how covid is going to shift or is Shifting this uh all of these things all right Jason do because often healthy buildings green buildings are also just like newer buildings like maybe with a better layout or like more economic Furniture better lighting like how do you control for the fact that it's the healthiness or the greenness that is what's causing prod can you hold on that for like five minutes I have like three or four or five slides for that for you then you throw all of those comments to me but that is going to be an important part of the lecture so that's exactly that's exactly what we are here actually one of the main purposes of of uh of c and me in this course is actually to giving you the right Thinking Tools to evaluate those in a way that is H it's a fair assessment and it's an actual assessment of the feature that you want to evaluate and not something else because that's something that you can carry for anything that you will do in your job afterwards like I can teach you everything from the car technology now but if it changes in five years you are not going to be in a very good position but if I teach you how to think about any evaluation of the technology you can carry it for green healthy smart heat pumps hydrogen whatever it is you will think about the exact same uh in the exact same way so we are going to do that today we're are going to do it tomorrow we are not tomorrow sorry next well actually maybe tomorrow in nakot Taco I can also give some of those um but next week with the green uh C's lecture there will be a lot of it we call it Apple to Apple comparison right so you really want to compare things that are exactly the same except for the fact that that specific feature that you are looking at is changing all right so in terms of what we can do in the building and given that c is going to put unlock a lot of money uh what can we do to this lecture hall to make it there you go we have an an inquiry already always leure outdo no wait wait one second take not okay yes very important there's no there's no outdoor light and so hard to see the one you don't get uh the health benefits from it and also you don't see the time pass and so like you're just like I've been in here for so long like what happen to the day that's my biggest complaint with this this room can we test that how long do you think that you've been today here uh six hours eight hours I don't know uh 25 minutes so no actually today it feels shorter than it is it's H you've been here 40 minutes okay it's a compliment I'll take it as a compliment let's let's slow down time for now anyone else any inquiry how so we have okay let's bring it back to here lighting and Views I will I will call that one lighting and Views any anything else ergonomic these chairs are designed to like stay in place so we're always kind of like portioning our spine like after like after like Ventures it's like three hours we kind of walk like this no it's very important ergonomics anyone else we'll fix that we'll change all the Vicky was Rel to the chair I I like to know if there's like any in like these Fabrics because they like haard materials and so yeah like if like this like coating of the materials like VCS or not correct yeah so very important materials carpets yeah yeah the V yeah V so we were talking about outdoor air quality like outo air quality problems with pollution and so forth but of course we deploy things in buildings that are a lot of times poisoned and poisoning us so that's important and that's something that the science is getting there but there's a lot of information symmetries there's a lot of capacity on what is what each of these materials have have in them that can actually affect us in one way or another uh it's too small to so that if you skip class it's very easy to get car that I don't know where we will fix but uh valid concern anyone so we have we have materials we have ergonomics we have lights and view anyone SE I don't know Sy ventilation so here we are testing it this guy I don't know why you guys can read it he says 700 when it will get to 1, or 900 then these things will actually start consider as not healthy we are we are keeping it below uh but we will show you that even going from these levels all the way to 500 can actually have a benefit from concentration and so forth but that is definitely one of the key things that at the moment because of covid but also beforehand like ventilation is being considered sort of like the flagship of uh of healthy buildings so if you are in a in a building that is not good in terms of air quality it's very hard to argue that it's healthy um anything else one more give me one more we talk about vus we talk about ergonomics we talk about v's and materials we talk about ventilation we talk about Tamar lights lights artificial lighting yeah thisone yeah imitates yeah that's important one I you know that I have a joint position with the University of mas there you have Phillips and Phillips is developing a lot of work into trying to mimic natural light the the reality is that you look at the science is very hard to mimic it but it's definitely there is definitely a room for improvement uh in terms of we have here and what we could have but is very hard to mimic any effects that the Sun have on us in our C circulan rhythms and so forth but we can make our life lives less miserable by being here yeah yeah those two lights that I can fix right oh can I fix it can I don't know you every single one of that's great sometimes actually just about asking the right question and also I noticed um something about me my perfume the T the T slots works for hours but if it's if a student from Stow or Harvard doesn't work that's an easy fix too much bigger oh we are not inclusive all right guys but these are let me like I I put it also in the reading notes but these are pretty much we hit into everything that that is there we we missed noise these are this is sort of a bunker so we don't really have a lot of noise that is good but of course comes at the cost of not having any views or anything like that plants we don't have any plant here SII has the the office full of plants but she didn't dare to bring anyone here uh and then as we say design and and so forth and of course there's a lot of work into uh the access and the design or something of how how you make people move in a building right so you see that in a lot of these healthy buildings what when you enter the most prominent thing that you have is the staircase to make you go up and move and exercise and in some others what you see most prominent is is an elevator uh and we are not talking about the high-rise buildings where you don't have any alternative there but we are talking also about like a four five story office building where you could definitely walk upstairs and you still make people the default and Notch them to go to to an elevator all right so but what I like is that almost I saw you the what I like is that almost in any class I always come to the conclusion that this graph is sort of intuitive for everyone like kind of we all think that there is a better way to to design buildings and along the same Dimension so this is nothing that is rocket science is not that I'm asking you how an mRNA uh vaccine works this is something that if you give people the the opportunity to talk they will always point out the same problems Tamar are these meas are these being measured to uh um so a lot of the top part are measured at a continuous basis so this guy is measuring uh is a chip sensor and it already measures thermal Comfort it's already measur indoor air quality and ventilation not very difficult to measure the uh the tones and the intensity especially the intensity of light and noise and Acoustics also very easy to measure a lot of these guys will be way more qualitative to measure and will be the studies will be a little bit less strong than what you have up there because also this comes from environmental science this comes from more the psychology and softer part of the scientific world don't need the bottom parts to be included in order to determine the of yeah I mean to be comprehensive but I mean it definitely there is definitely studies that would say that makes a difference and so forth with this one you can actually almost pinpoint like uh what you will do in in a basic real estate economics like elasticities and so forth like for every unit increase that you will have in indoor air quality how much you would expect in of the outcomes and so forth here there's no unit increase in in biophilia and views right either you have them or not and it's also very complex so what do you see outdoors and so forth but there's a lot of studies especially in hospitals about recovery times and so forth of patients when they are having natural light when they're having certain views when they have wooden rooms instead of just this whitish room and so forth actually the hospital is there are few podcasts I'm happy to put in in the canvas if you find it interesting but this is a place where we will really need all of these Technologies to be the best and unfortunately this is where we make the worst design options that is actually very very sad that we actually make people going through one of the most difficult moments in their life from the family side or from the patient side in the rooms that are actually wide with no consideration for design and making them more miserable than their disease will actually even make them so there's a lot of there very interesting topics Yeah question um heard of any research based on like carpets and allergens I know as walk lot in there but seems like builds don't Comfort yeah there are quite a lot of these things uh out there of like the the risk like the the problems with uh carpets and voc's and and so forth and the D that will make people uh less healthy or in the schools make Asma asthma attacks and so forth more likely and so forth like there are a lot of these things but the problem is that when it comes to uh when it comes to materials the problem of thinking about it in a systematic way is that when it comes to make decisions for your own building on how do you upgrade them there is not a lot of information about any of these things composition and treatment along the way right so we don't know where this what kind of pain they put in this wood to make it more resistant to different things and so forth it's very hard to understand the chemical composition of anything like that you will expect that and that's s of one of the the discussion points of the healthy buildings book of these Harvard professors you will they put it in a very nice way you will find it crazy nowadays if you will buy any can I take this you will buy any drink or any U any food item and you will not see the composition of every single thing that came into the production of these guys but you cannot see anything at all when you buy any building or almost any building component that you want to deploy in a building so to have this strategy in a systematic way we are a long way down the road to to go and that also affects by the way a lot of the problems when it comes to Energy Efficiency that we don't have these building passports that we actually understand let us understand what is all the elements and the characteristics and the efficiency and so forth so then we could actually as as a almost like a Lego type of of work from a engineering perspective see what type of elements do we need to upgrade to have the biggest impact because we bought something that we don't know what has on and we have to even like break the roofs and so forth to understand what is really in there or get into the the machines and so forth so it's is very hard we don't have a systematic information system on components in buildings and that's something that will require those type of strategies to to flourish yes so the light system and the planting to the house building because before IED in the headquarter about the house building and prity standard prity High about the W certificate so planting is everywhere in our office and control the life system M so is important yeah yeah very important yeah yeah yeah I mean lighting is something that is definitely affecting a lot of our bio rhythms and so forth and then you can sort of go against the clock and the day if you flatten it out over the entire day all right today we are going to talk about mainly for the the sake of time because otherwise we will have to be here as long as the studio class the other day or Ventures and it's really not the purpose to lock you up here for for five six hours today so I'm going to give you we are going to walk through the the whole value chain of ventilation and air quality just to show how to think about it how to be critical about the the science how to be uh knowledgeable about how tenants will think about it and also how to discuss what are the barriers to to it right so let's go through two basic and then climb from the very bottom all the way to the very up and you will tell me when you have any questions and comments and so forth okay I like this Lively discussion so I'm very happy today I think that we are beating the the previous class last year it was very Lively yeah you remember IIs you were always a quiet guy though but very very smart that's why we picked him to TA and I actually even his thesis adviser but quiet you're are quiet by nakot Taco he talks tomorrow you can come you do do do you you see you put him in nakot Taco he talks that's the the impact of buildings all right so the impact exactly more that I don't know I I haven't that I I cannot say that so H all right so first thing that we are going to do is how we are going to connect these different strategies how are we going to evaluate the impact so I don't know where you guys done any work on uh on funds but you have these impact funds what they do all the time is to one of the things that you need to do to create an impact fund is to show the impact that you do that you create with the Investments that you do with the money that you have in the fund so let's think about healthy building strategic from the impact fund perspective so how we actually can are able to evaluate impact in a way that we can go to investors developers and Pitch it to them in a way that say Hey you want to can generate a building that can promote X this is this is one technology that you need to deploy because I know what is the impact of that for that there are multiple ways to to think about it but one of the the most intuitive ones that I that I think especially when it comes to air quality is coming from the uh um environmental science and the and uh the environmental science literature where when you want to evaluate the impact of any threat any poisoning element you have different steps so you have first you need to understand what is the the concentration of that threat right so if you want to think about what is the impact of ozone or or voc's or PM 2.5 or something on someone in a given building or in a given part of the city you first need to know how high is the concentration of that pollutant or or chemical in that area so the first thing we need to do is assess how uh how large is the threat how much of that pollutant that we want to reduce with those Investments is and then we need to know because ultimately what we want to understand is the impact on people we need to understand for everyone that passes by or every one of the target uh group that we have the occupants the employees and so for how much exposure they get and that is break out in two parts how much they get exposed every time that they are exposed and how often they get Expose and let me give you an example for example we get this kitchen there that is locked up to almost everyone except for Chichi right your private kitchen no I I don't even have the researchers and the students if we want to use a kitchen become our researchers notching is always good uh so there there might be like a gas leakage and almost nobody will get a problem because nobody is there almost any time I've been there probably twice in four years um so that's one of the examples that if you really want to be a meaningful investment even if you have a high concentration of a problem there of a of a pollutant there you probably don't have the be the best investment in terms of improving health because nobody really gets exposed now a gas lick is very harmful right so if you spend there few minutes probably get passed out and you might actually die there are other things like poor ventilation that are definitely less harmful but everyone is exposed to for example in this room we keep climbing up not not yet there but imagine that that that guy goes double none of us will die maybe some of them some of us will get sleepy but all of us are exposed and for several hours during the day so then when it comes to improving that one it's much better because yeah the concentration or the harm of that concentration is much lower but the the exposure is much larger so this is what we need to to understand very well first how much we are exposed so what is the concentration of whatever Factor we want to improve how harmful it is and that will require to look into the the the literature and the standards from ashr from EPA and so forth to understand how harmful that is so it's not the same uh being exposed to uh C o or being exposed to nox or than being exposed to voccs or CO2 those things is something that you need to understand and that's why the public health literature epidemiologist and so forth earn their lives so we can break the process of understanding the impact of an investment in two side so understanding the Baseline concentration and how much we actually uh reduce the concentration and then understanding the actual exposure and the and the actual impact on on the people so there's going to be an assessment part and there's going to be an attribution part that that is going to ultimately connect to the health and wellbeing and performance of people so if we don't understand that black box on how people are exposed to that investment and how people are exposed to those threats then it doesn't matter whether we are measuring everything all the time we will not be able to connect an investment in the building to the people that are using that building is that clear enough or we make it more complicated clear enough Julio how can you compare the impact that a PO has that a PO how can you compare to kill you have to put it on a scale right well that is yes so there is one thing like kind know there's some uh basic uh tools of exposure science that is you have the dose response function so that's something that you can compare with the same outcome what will be the the impact of every unit of intake of that polutan on that given outcome when you want to compare across outcomes that is something that comes down to what do you value as a company or what do you value as a um as a country right so how much do you value uh one person dying versus 300 kids scoring lower in a in a in a test that will let them uh get a a worse job afterwards so there is some subjective part there that will come down to policymaking and and and preferences and so forth of people that are are just not objective like it's just like we have a lot of discussion about the the value of uh of a of a life the value of an statistical life that's how they call it in in that those are things very subjective at the end of the day it comes down to the priorities of your firm or your local government of yourself if you are thinking about how do you want to improve the family your your family's uh situation anything else yeah a very interesting phenomenon during uh 2018 uh 2015 to 2018 Bing uh polluted pollution is very serious and protect our house so developer who prefer to build the house house building but after that uh because the pollution Improvement and develop per now prer build the house building because it's pretty high cost and the rent May a little increase so yeah it's very interest yeah Beijing is also a good example right because Beijing you have two things going in parallel on the one side the local government uh and the same as the national government tries to put down pollution that she's a lot of work there she's the expert and then on the other side you get people exactly so so the the threat the outdoor threat is going down and therefore what you are preventing people from being exposed to is also going down so then the the the benefits of improving filtration in China is start to be less problematic than when you go back to 10 years ago when or 15 years ago when was the the the peak of pollution c yeah I think that's more nuanced because although the absolute level of the air pollution is going down maybe thanks to the government regulation but people's awareness is going up right so the awareness going up so they more and more people to pay higher PR higher price for lower uh lower air pollution so the absolute level may be down but now people are more and more worried about this and they care more so they still want healthy buildings and we know that because of your work it's true but actually developer and customer to prer the Green Building that house building is the cost is the great building yeah the features yeah it's not cheap that's why we are here um okay so in the in the assessment part into the detection of how big is the problem and how much actually we have do a threat in our building one of the things that is very uh powerful in the real estate industry and Engineering side is that the price of these guys of Those sensors is going down dramatically so it used to be that something that will measure CO2 with any ER trustworthy accuracy will cost like $10,000 and this guy cost me like2 200 uh so it's very big drop and also the the the connection to the internet also makes that the The Human Side of operating those devices is much much lower because beforehand I would have to have one person going with it all over the place and pay that salary to measure anything and to do an assessment while now I can just connect these guys to the internet they will be loading all the all the time data and that will ultimately uh generate give me the the answer of how big is the pollutant concentration and how big is the problem and so forth and on the other side the other sanana she's working on very exciting project downstairs your sensible City lab uh City scanner right do you want to say something about that how big is the pollution in this area yeah actually the pollution in cabridge compared to a lot of the rest of the world as you saw like 90% of the Worlds uh is is pretty decent here overall but there's High spao temporal variability so as C was saying even though absolute levels in some parts of the world are going down we're starting to understand more and more of it both in the scientific way and in the public perception way and also the World Health Organization is constantly reevaluating and understanding kind of how they recommend or how they make those guidelines on what safe exposure is and so I think with the latest round of revisions that's what kind of pushed you know this number up so high for us to understand that wow we are not doing so well in terms of mitigating a lot of the root causes of this work so there's a lot of interactions and there's a lot of um you know interplay between the built environment especially in urban areas Transportation air pollution and uh as V was talking about as well personal exposure different groups are exposed in different ways depending on what they do their incomes fortunately especially in the United States race is a very big indicator of exposure to air quality for environmental conditions so it's a very complex set of topics but as one showed us there's some really nice ways that we can combat it side exactly and I would say like kind of the wh puts the alarm up which means that puts the the level of acceptable exposure down every time so it goes like 40 25 10 and it seems that it will get to zero because any any particle that we will breathe will generate some somehow a damage and on the other side the data from people you know our phones are generating so much data of us and all the weable some people I can see here with apple watches and so forth so we now have access of H pools and and movement and so forth from a bunch of people that were actually very unaffordable again few years ago now uh when it comes to the attribution side so how do we connect these data together or how we do connect the data from buildings to any outcome of of people this is where where the where the diff the Striking difference comes with respect to evaluating Energy Efficiency Investments where everything is mechanical you know as a facilities manager at which level you running the engines of an hbac system and you can actually see very accurately what that will imply for the energy consumption of that building and the CO2 emissions and so forth you cannot do that with the health implications of that specific action you can put the HVAC system up but ultimately the health impact of that comes down like interacts with the with the behavioral and the people's layer and also with what happens in the city as a whole too right so if we are in a very severely polluted day as as Sana said there is a big spatial and temporal variation which means that some days we will be exposed to three times the level than another day and actually from my research I could see from the data always the case that it can change very rapidly from one day to the other because one of the things that brings pollution is wind so in the city like Boston if the wind is blowing from the sea very good if the wind is flow is is blowing from a city like New York and the power generation system of the state of New York very bad we have no control it can change very rapidly and it can be and it doesn't matter for our lungs because we are still breathing the the pollution no matter what the source is um so in that sense the same action that is improving the filters or improving the HVB system can have very different consequences on the health given the environment but also given the people if I make this lecture hall very healthy and nobody shows up we going back to the exposure part of the equation then it will have no impact on you if I want to see what is the impact of that investment on the great of you guys and everyone connects on Zoom yeah fantastic no impact on that we will have to put very large coaches for us to to just do napping here because that would be the only use of that lecture hall so all of these behavioral things make it very hard to assess but also very hard to just uh understand from a mechanical perspective what will be the consequence of that and what we are going to talk in the next five to 10 minutes is going to be about how do we design a studies or how do we design evaluation systems so then we can actually assess the health implications of those impacts taking into account that there will be Al always a behavioral layer in between the action of the facility manager pulling up the engines or the action of the developer upgrading a uh a system in a building and the ultimate consequences of of the people that we care about the residents the uh employees uh the clients whatever it is right if you go to the marketing literature there is also like we don't talk about it here but there is a lot of data on how people behave in a supermarket and there's a lot of tactics to try to get every penny from our pockets every time that we enter in a Walmart or in a Costco or in Prudential Center and so forth look at C she's always buying these necklace from from presential center it's all because of you're notched by the design um all right so going back to Jason this is your moment of Glory because I prepare this uh this lecture this slid exactly to tackle those questions so when it comes to understanding the impact as you said it's very hard because if you just whatever the difference between a healthy building and a non-healthy building comes in terms of health and performance let's say that we find that the the people living in this house are uh being 5% healthier and 5% more productive than the guys living in this house now the question is what generates those differences there could be some features there they could he like they might have better ventilation and so forth but the level of Health especially when it comes to air quality is very much shaped by the environment where these guys are so it's very hard right you have uh different things like uh green areas and so forth that will actually affect the ultimate level of environmental conditions in this house and that will actually be very different if we have in the other side factories and so forth so the outdoor factors change and we have to control for that in one way or another and also one of the important things that the occupants are also different because if you think about that area and if you think about that house and those two houses are put in the market then the question is why would you go to the one on the right why would you go to a house that is in the middle of an industrial area gray full of clouds not good right so the reason why you will go to that house is either Financial you can afford you cannot afford to go to the one on the left and that means that you probably cannot afford also other things related to your health you might actually not have the best health insurance you might not go to the gym you might not do all things or even if you have it it might be your choice not to uh pay the premium for this house and it might be your choice also therefore not to go to the gym because I just want to save all my money or whatever or I just enjoy doing other things enjoy going to the cinema and I don't enjoy to the G so your value of any health strategy that you have in your life not only the place where you live is probably much lower than the guy that lives in this house and that introduced a lot of problems because all the difference between these two guys are not related to this specific guy here but is related to this but also to the people that lived in there and therefore if we let people choose the environment where they live where they work then we will always have this problem confounding our studies and introducing and and basically inflating the difference between this building and this building because all of it is inflated by the outdoor environment and all of it is infed inflated by the people that live here versus the people that live here this kind of looks like a a picture of the suburbs versus the city how do you say I mean moving into the city isn't because you don't have the means to live in the suburb it's a it's a choice you know you want cut down Comm time you want to be closer to amenities you want to be closer to work it's I think it's just you have the means to to live here you know just City living versus suburb living correct so then that will also be like if you prefer to live in the subbs it's very hard to to to imagine that that's only thing that you differ from the person that want to live in the in the um in the center and then that those differences will be not uh will not be intertwin also with anything that affect your health because if you live in the S maybe you appreciate also some walks in the evening while the guy that lives in the city center they he just appreci to go to the bar and have some beers with the with the co-workers after after work alcohol versus active living very big for health so forth that's just one example right but basically once you introduce people sorting into places either within the same neighborhood or across neighborhoods then you always have the problem of if I attach any differences in your health or in your performance to the place where you live to the building that you leave is it really a fair comparison or you are actually blowing up these differences by all the other things that you are that so the challenge here is that because you have this human layer in between the actions of the facility manager or the architect or the the designer and the people that ultimately you care about you have to take those things into account very seriously and that's what we try to do the people that try to do these studies and I will show you a little bit few techniques that people use um there you go this is one one is uh we don't let people decide their exposure to something but we actually manipulate that exposure in an experiment so we invite people when we care about how ventilation affects people CO2 levels affect people so this guy is measuring in PPM the concentration of CO2 in the room so basics of CO2 when we breathe we take oxygen we exhale CO2 and then the concentration of CO2 in this room uh will be up uh or will be like the2 that I'm exceling will stay here until the the room refreshes the air with outdoor air and brings back oxygen right so if this room will be empty it will be around 450 that is the Outdoor levels when we come all in and we are generating CO2 the room goes the CO2 levels in the room goes up until these guys refresh there so uh one of the things that people do is that they bring people some of some of the techniques that people do in in research is that they bring people to a lab and they manipulate the environmental conditions where while they are doing a a task so they are interested in how cognitive performance is affected by levels of CO2 what they did was bringing uh around 24 people uh healthy o office workers to to a lab in syak Cruz and they will have to work in that lab for uh the whole for a whole week and every day the the scientist will manipulate the level of CO2 that these people will be working on for six hours and at the end of the day they will give in a cognitive task to see how their decision making is affected by the level of CO2 in the best day or in the best CO2 levels they will have around uh 550 BPM is almost outdoor levels it's the best that you can have um in the in the medium level so it's what they will say like a Green Building day it will be 945 almost double and in a conventional level it will be uh where where most of the people will be exposing a normal building it will be around 1400 these was these were the levels that actually we observe a lot of times around MIT before covid but this was sort of like the conventional level what you see is that in any level for the performance as you go to lower levels of CO2 the level of cognitive performance increases and what this means that people are better able to uh to process information and are better able to strategize with those they were having all of these complex uh cognitive tasks that I'm happy to talk about it more but they are developed by psychologist to understand how you your decision making is impaired by CO2 level this is their study that everyone quotes when they are thinking about ventilation and air quality in buildings this is by Joe Allen here uh the first author is this professor at Harvard Public Health School of Public Health he's the most famous guy doing these studies and this was the study that make him famous bringing 24 people into a lab and manipulating the levels of CO2 sometimes science can be simple powerful and if you're a Harvard Professor impactful too I got questions really interesting research never thank appreciate it so in this is that saying simply saying from your perspective is that saying that the high Concentra of carbon dioxygen yeah will decrease the concentration commity or simply saying because the level of carbon dioxygen is high it means there's less fresh and less oygen it's a better question yeah these two things are always convoluted but in this case the level of ventilation was keeping constant and they just artificially put CO2 in the room with a gas bottle so if this one is purely CO2 levels but in this in the in the real world so I did for example a study trying to measure with Those sensors uh the levels of CO2 in classrooms of the classrooms of 6 6,000 kids and I will get overtime changes in CO2 levels School term after school term three years and connected to a test score seeing that actually there are big differences when they are exposed that that is convoluted with ventilation so you are not only exposed to higher levels CO2 but also probably voccs and other things that are uh more prevalent in the room where the level of uh the ventilation rates are lower where you are putting flashing in less oxygen into it Le have you seen differ home gas oh yeah there's a very interesting study uh in so the the the exposure science studies in in homes are usually less prevalent because you have less ability to measure and so forth but there is one done by researches at MIT uh where they install all sort of sensors in in homes and there was sort of like the to your toaster is killing you is so that was the MIT news headline because when you switch on the the toaster there was a big spike in particles and so forth um I think that it depend this like one of the things that is important to to understand in all of these healthy buildings that there is no such a thing as one home genius one thing that is healthy buildings there is a multi-dimensional aspect so in some things some chemicals you will be more exposed in certain offices than at home because you know you use different cleaning products you also have different ventilation systems and so forth uh but some others you will have way more exposure at home uh and also depending on the neighborhood and so forth so it's very hard to say whether it's healthier at home than healthier at the office there are some chemicals that will be much more prevalent in at home than at the office uh and the other way around will also hold too Carlos question as as we looking into we're looking into real estate like office lab and all this stuff is being basically basically imposed by Public public policy at least in the states in Europe are there any studies and any actions being taken for examples at the school level School proper real estate and are publicly owned yeah it's the public policy is basically making mandatory for private investors to mutate or retrofit or whatever their assets into green assets because of being prone to uh environment and sustainability yeah are there are they doing something with their assets publicly owned assets to improve or like show yeah yeah some support yeah so for yeah more of the more of most of the Investments that you will see in the schools will be done by public governments or school districts in a way some sort of public or or or public good money uh there is a lot of money being pumped in since the covid because the schools closures was one of the key things that were happening because there were these buildings that were very poorly maintained especially the hbac systems in the in the US you will have one out of two schools that are not having the the HB system up to speed uh and they will need to modernize or or replace or even install so school systems are really bad school school buildings are really bad and now they they were also very densely populated so they were at the epicenter of this covid outbreak so now they are getting a lot of public money that's what they are having all right and the same happens with particles is one of my research we had it with the chess players so the Strategic decision making is also impaired so and again being back to the point right this is nothing that you can compensate if you are making a decision and you made that decision and it's wor off then you cannot just replace it by extra coffee and stay in extra hours you made that decision is going to handt you so if that decision making is impair you have very bad consequences one of the things that I am uh that it also happens in the office building with the respect to health there are several studies this is one that I did was basically understanding what are the impacts of moving from an normal office building to a healthy building basically a lot of stuff happening in here for the technology around ventilation uh they have natural ventilation principles where uh they don't rely a lot in in a mechanical ventilation system but what they have is a solar chimney that will actually make the air circulate it's very high ventilation rate in that one very good building and they actually work with me to understand what are the impacts of of this building on health so we work with them for over two years for three years so we were with them before everyone was moved and then 70% of the workforce of the municipality were moved to this healthy building and 30% was staying here and the reason why they stay here is mainly because they were not exposed to to the public very Wells if you didn't have a lot of meetings with external people if the citizens didn't have to meet you then they will not have you in the flagship building but they will give you where you are which means that it's also a very nice environment because it's actually not you again who decides where you want to go but it's actually the municipality very random decision it forces you to stay where you are it forces you to change actually this building is even put in a in an area where it's more polluted so it's actually you would expect in that one to backfire and they work with us to be able to assess the the um the health and wellbeing of people and also the sick Lees around uh the changes in sick leaf and what you see is that when you measure how these people feel the people we were seeing the the prevalence of sick building syndrome so the amount of people going there with fatigue and other symptoms uh and you will see that almost one out of two will be suffering from that before moving and then as they moved the people that were to a new building h went down by half the amount of people reporting SI building syndrome and the others stay where they are so this Gap here will tell you the difference uh in health associated with the building and if you will do the quantification and Link it to the sck Lea and so forth you will see that if you will capitalize that investment will be around 2.5 million euros that this municipality is actually getting by just having people taking just less days of sick Le so it was around one to two days uh less sick Le and that is what you will get there um now why is this important not only for the municipality but in general for corporate tenants is because if you look at the income statements of tenants you will see that most of the money of a corporate goes to pay employees so we were talking a lot over the first two lectures around the H not only because of the money but also the CO2 emissions uh uh involved in it but basically about this $3 uh part of the buy so basically this is the 330 300 rule is the proportion of money that goes to utilities rent and payroll we were talking about that part of the p and now we are talking about that part of the P so even one like very minor changes in here will generate ultimately a big impact in the in the income statements so we are going to talk now about how to quantify those you want to say something yeah uh I mean a good a good example to support the this hous building uh in China a very famous developer uh called B and another of is famous about the housing building and one the same location uh uh the gous projects always price higher than competitor and always uh always can higher than 10% to uh 15% have price than others competitor right so and always the consumer prefer to uh this higher price because also great that's liation about this only to building low yeah we'll talk more on uh on Tuesday also about these differences in market segments and so forth yeah people it be the that those people yeah well that would be the the reason why you will have a baseline right so we were with them before they were moved so if these people were just in general different they are right they are different people and so forth but basically what we are using is the differences in in health symptoms and sickly before and after they were moved for everyone so you're looking at within person variation so in that sense you are not comparing people to people you are comparing someone before and after the move uh for both groups and the difference in the in the Delta for the people that moved and the people that didn't move is what gives you the impact of the building um all right so if you think about the the translation of that into money for the average tenant you see that most of it like this a um a fake company a fake company that the income statements that the the professors at Harvard came up with to to show how to quantify those uh benefits for for teners see that that average tenner will have six million in Revenue three million in payroll that is sort of half of it uh and then you will pay 300,000 in in rent 30,000 in utility and so forth and you want to consider what will happen if you double the ventilation rate from 20 CPM per person to 40 CPM per person and see what will be the impact so if you bring the science into play you will be like okay the the cost will be around 1,600 that would be the the cost of of doubling the ventilation that is still a quite significant part of the utility but it is what it is and now if you get people less sick it means that basically the way that they conceptualize that you have to pay less number of people because now you are paying some people that will be sick or you have to pay less number of days per person because some days you are paying and these people are sick so you know you could just do the exact same Revenue with just less uh money because now these people are fully operational and they work all the time and they are also more productive so they are actually more able to produce whatever they are doing or better quality so that's how it is uh so in total this how this is the amount of of benefits so you see that anyways again small impacts on here and here will have a big impact on the ultimate bottom line and that's sort of the message here um even if you are very conservative you will have because you are chipping in this big big large shares of the buy it will be a very very powerful impact on your incon statements as a tenant so if you believe any impact then it's worth probably going for it because anything that will impact these large numbers will have a big impact here now uh and that will also for the split incentive type of bargain in William you can still because you you grow the pie so much the landlord can still say hey give me some part of this because I am the one making the investment and you still have a lot of margin to make both a win-win now you have to communicate and we will talk about it later CZ maybe I need to use five minutes of your lecture on Tuesday welcome how are you sure you enjoy it any time there you go anytime that's what I like uh let's bring the projector but uh I don't want to rush the the last wrap-up because actually it's connected to you uh but basically here you see the the idea also that we talk at the beginning you grow the pie and you have the negotiation how much you're going to give and so forth and what is the the approach do negotiation is something that is H for the next part I will Pro I promise that I will only take five minutes and in a way that is connected to your lecture but I don't want to keep you longer than we are supposed to I want to take some questions and then we are going to go up but one last slide this is just an hypothetical case but this is a slide that will show you what will be the numbers if you will use the best science that you have to understand what are the impacts of increasing ventilation rates either doubling or increasing by 20% uh in an average office building in the United States actually for the entire office building portfolio in the United States what will be the consequence for the energy cost the absentismo and therefore the the performance here and what will be the The Net Present Value impact of that you see that if you will double the ventilation rate even before covid this is a study of 2012 but is the most comprehensive one you have still 37 billion gains of doubling the ventilation rate and you will have 20% um if you will increase by 20% the ventilation rate you will still have 30 billion Gaines if you compare the cost versus the the benefits using the best science available now these numbers are big enough that even if you have a big margin of error big big big error bars there as you like to do in the in the in the science literature you will still have a positive number so I don't want you to kind of memorize 37 or 13 but I want you to walk through it when you have the time before the midterm to see the whole logic and you see and realize that even if you have some uncertainties in there the gains are so large that is worth considering and we will talk more later about the barriers that will be how we're going to grab up everything but just for you to go home saying there is something to gain and then maybe in nakoto we want talk about why wouldn't you do it and now I will take the last question I let you free roit yes at the surve think the costs were higher than the benefits right well the cost only for that part yes but the the marginal um this is the the marginal benefit of making the building sustainable not only healthy but also improving the Energy Efficiency and the circularity these are I can talk hours about this building it's a building that is also based on principles of circularity the building is made we actually brought the Misty Netherlands Fox there the building is made in a way that all materials can be upcycled from the tables to the concrete and so forth so that require also an extra uh amount of money to select those materials have the people that to make sure that they wouldn't treat it in a way that will make it less uh um less upsable and so forth so all of that is 3.4 they didn't quantify how much it was exactly the healthy aspects everything was a bundle what they quantify here but this is only the healthy aspect that already will cover quite a big chunk of it and then if you put the changes in operation because you have a natural ventilation system instead of a mechanical ventilation system so you need less uh operational cost of maintaining that edge back system so for that cost will be much much higher 2.5 million per year all no it's capitalized capitalized yeah everything is capitalized good good question right thank you so much guys I'll see you tomorrow and on Tuesday we'll gra that thank you for all the questions appreciate it