Prologis Reaping Rewards of Solar Power

Aaron Binkley, director of sustainability programs with industrial REIT Prologis (NYSE: PLD), joined REIT.com for a video interview at NAREIT’s 2014 Leader in the Light Working Forum in San Francisco.

Binkley recently authored The Real Estate Solar Investment Handbook.  Binkley discussed his motivation for writing the book as well as the investment outlook for solar technology.

“I think the genesis of the book started six years ago when I was figuring out solar myself,” he said. “I was getting a lot of questions from others in the industry and others in my own company about how to look at this and think about it very strategically – and I just kind of kept notes. Eventually, that seemed like enough material to do something with, and years later that turned into a book. In terms of where it’s headed, I ultimately think that we are looking at that as a bigger long-term opportunity.“

Binkley also shared his opinion regarding the biggest benefits that property owners can realize from investing in solar power technology.

“For us, it’s really a great revenue opportunity to utilize an underutilized portion of the building,” he said. “On a distribution center, there’s a very large rooftop that’s typically baking in the sun all day, and to make use of that in a revenue generating way is a unique thing that we are able to do. That may not apply for every asset class, but it certainly works for us.”

Binkley also described some of the risks and challenges involved in investing in solar power.

“It’s certainly challenging,” he said. “Operational control, legal structures around how you take advantage of tax incentives and other rebates that are available for solar are first and foremost for many people. Risk management of the planning process, as well as the construction, is also a huge piece of this.  The last thing you want is to implement a project like a solar rooftop installation and have that negatively impact the building or the customers inside the building.”