The Michael Corleone Method of Green Real Estate

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Michael Corleone was the man.

Of the three sons in The Godfather, Michael was the toughest and most successful.  Sonny was the hot-head and Fredo was the buffoon. Sonny and Fredo enjoyed lackluster success but their flaws were eventually exposed and they both died young.  Michael watched his kids grow up and lived a long life on (largely) his terms.  I’m not counting Godfather III which should be banished to movie Siberia along with Rocky V. On behalf of Italians everywhere, I apologize for Godfather III.

The point is that there are 3 methods to green real estate investing. Pick the right one and you’re hugely successful, pick either of the other two and you’re done.  They are, from worst to first:

3. Green-washing (Sonny)
2. Materials (Fredo)
1. Performance (Michael)

The Sonny Method – Green-washing real estate investors put CFL’s in their properties and call them ‘green’. They state that they’re green builders because they are concerned about the environment when it’s obvious that it’s a pure profit play for them*. They get business cards with green leaf logo and usually have some form of ‘eco’ or ‘green’ in their name.  The best is when they have both, like ‘EcoGreen Homes’ (which is like saying PIN #).  These investors usually have a short run of success until they are exposed as charlatans.  Once exposed, they’re like Sonny at the toll booth-full of holes and out of the game.

*This would be completely fine if they were honest about it.  Patagonia operates this way and everyone loves and lauds them as a green company.

The Fredo Method – These builders/investors are very interested in talking about materials.  They want to tear out Formica counter-tops and lay down recycled Paperstone counter-tops because they are a ‘greener’ material.  These guys can argue all day about whether bamboo is sustainable and whether you should spend extra money to get tripled glazed windows. My opinion is ‘No’ on both accounts.  This method includes a lot of waffling as well.  Sometimes, SUV’s are bad, sometimes they’re ok.  Sometimes you need FSC wood, sometimes SIPS are better. Like Fredo, these guys operate on both sides on the fence and are ultimately sent on a one-way boat ride on a dark lake.

The Michael Method – These people are the smart ones. All they care about is performance.  They understand that performance drives revenues and that the Sonny and Fredo methods don’t work long-term. When they talk about bamboo, they’ll discuss whether it improves performance and any incremental revenue increase it creates.  They’re too smart to engage in green-washing because they know that as the general public becomes more educated about green, one wrong statement could come back to haunt them.  Tha’t why the ‘Michael’ people are wealthy and live a long life.

For what it’s worth, I wrote this post because this I have been surrounded by Fredo and Sonny people all week.  I’ve seen them prey on people who didn’t know any better.  I’ve seen them make ridiculous claims and argue arbitrary theories that have little value. And today, I thought to myself, if nothing else, my bigger pockets friends are going to know better.  They are going to know what to watch out for when someone approaches them about being green.

Now if I could just take back Rocky V…

Note By BiggerPockets: These are opinions written by the author and do not necessarily represent the opinions of BiggerPockets.