Flipping the Switch on Solar at CRE Developments

Veteran Los Angeles industrial developer Xebec completed the largest recent solar installation in L.A. on the roof of one of its developments in Sun Valley. The installation will eventually result in 4.3 million pounds of carbon reduction, the equivalent of making roughly 1,000 homes carbon-free.

The project is part of LADWP’s CLEAN LA Solar program—also known as the Feed-in Tariff (FiT) program—which allows commercial property owners in L.A. to take advantage of thousands of acres of underutilized rooftop space by generating energy through solar panels and selling it to the LADWP at a competitive fixed rate.

Xebec’s Randy Kendrick shared insights on how the project came together, and why it is important to both do something good for the environment and to increase the return on investment of a development.

Q: Why is installing solar panels on the roof an attractive opportunity / revenue stream for Xebec and its investors?
A: Installing solar systems on the rooftops of industrial buildings makes all the sense in the world for the real estate asset itself, as well as contributing to the expansion of renewable energy systems on the energy grid. Early-on, the solar systems were on racks that were damaging to the roof membrane. But with recent innovations, the current systems are worked into the overall TPO roof membrane, so they have become much more attractive for long-term landlords. This also creates a revenue stream that is measurable, and adds to the property’s value based on applicable cap rates.

Q: How common is it for industrial developers to install solar on the rooftops? And how did this opportunity arise for Xebec?
A: Here in Southern California it is becoming more common every day. In other parts of the country, where hail storms and other extreme weather occurs, it is not widely utilized. Xebec has been researching solar installations on Southern California assets for years. But the opportunity recently really came into focus when the systems were properly integrated with the TPO roofing systems.

Q: What does the future look like for Xebec in relation to this solar initiative? Will you retro fit current buildings?
A: The future looks very bright for the installation of solar systems on newly-developed assets, as well as selectively retrofitting systems on existing assets. The systems are particularly attractive when an existing roof needs to be replaced based on its age.

For comments, questions or concerns, please contact Dennis Kaiser