How WashREIT is Targeting BREEAM Certification: Q&A
Company CFO Steven Riffee details the company’s new sustainability initiative.
In late April, WashREIT announced a $350 million expansion of its Green Bond Framework for green buildings that achieve BREEAM certification, as part of the trust’s ESG roadmap. Specifically, the REIT intends to win the sustainability award for Assembly—a portfolio of seven multifamily properties across Northern Virginia and Montgomery County, Md.—and Cascade at Landmark in Alexandria, Va. Combined, these eight assets total roughly 2,400 units.
To achieve the certification, WashREIT will use BREEAM’s online platform to benchmark the performance of its buildings against the BREEAM standard. Once a licensed BREEAM assessor decides that WashREIT’s buildings meet the criteria for certification, a BRE specialist will review the assessor’s report.
“Once it has passed the review, the certificate is issued, and the certification remains valid for three years,” Breana Wheeler, U.S.-based operations director at BRE, told Multi-Housing News.
To learn more about this collaboration and what it entails, MHN talked to Steven Riffee, CFO at WashREIT.
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Tell us more about WashREIT’s recent deployment of BREEAM In-Use for your Green Bond Framework. How will things unfold on your end?
Riffee: There are two main components to our Green Bond initiative, both of which are in progress. First, we recently delivered a new development called Trove—a 401-unit addition to one of our existing multifamily communities—which features water- and energy-efficiency technologies, EV charging stations and the use of sustainable and environmentally preferred materials. This project is designed to achieve LEED Silver certification and the development costs represent a portion of the Green Bond proceeds.
Steven Riffee, CFO, WashREIT. Image courtesy of WashREIT
We also embrace the sustainability opportunities inherent in preserving and enhancing existing housing stock compared to replacing properties with new development. Our second initiative aligns with this strategy and relates to our recent acquisition of a portfolio of multifamily properties called Assembly.
At these properties, we are in the process of implementing a range of sustainability improvements, so that they will achieve BREEAM In-Use Very Good certification. This work will be completed later this year and will be detailed in our Green Bond Allocation Report that we will publish before year-end to provide transparency on the allocation of the green bond proceeds as well as the project’s impact results.
What made you choose BREEAM In-Use for your Green Bond Framework?
Riffee: WashREIT is committed to operating our properties to a high sustainability standard and BREEAM is a great way for us to systematically bring our recently acquired properties up to WashREIT’s standard. Our most recent multifamily growth was executed in large part by buying assets that serve the middle-income earner, where there is a dearth of affordable apartments that can be optimized to meet their lifestyle preferences and needs, and still be affordable.
We think this strategy is socially responsible and that BREEAM—having recently released the Residential In-Use specific version—aligns well with our sustainability priorities. It requires a third-party assessor to conduct on-site verification, which adds to the rigor of our commitment.
To pursue this certification we will benchmark, improve and document performance across a range of important categories, including energy efficiency, water use, waste management, resource conservation and transportation. These are impact categories we promote throughout our portfolio, and so the comprehensive nature of the BREEAM program aligns with our objectives. And with these programs, we can not only achieve our environmental goals but also deliver a superior resident experience.
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WashREIT has also committed to reducing energy consumption by 20 percent by 2025, relative to a 2015 baseline. How are you planning to achieve this goal?
Riffee: We are proud of the substantial progress we have achieved in energy reductions over the recent years, and this will continue to be an area of high priority for us. Both our completed and anticipated energy conservation measures include a range of no-cost improvements to schedules, set-points and sequences of operation; low-cost measures to eliminate waste and inefficiencies; and medium- and high-cost capital expenses for equipment replacement and upgrades.
Our approach is to ensure we do not miss opportunities to achieve reductions across the property life cycle. In some cases, these are discrete energy-efficiency projects, but more often than not, we are incorporating energy efficiency and conservation as a standard component of regularly occurring events such as routine maintenance, unit turnover, space build-out, equipment end-of-life or property acquisition. In this way, we evaluate the operational expense savings achieved from the incremental costs to pursue the higher efficiency presented by each of these opportunities.
How has the pandemic shifted your approach to ESG within the multifamily sector?
Riffee: The pandemic has not fundamentally shifted our approach to ESG, but it has highlighted a few areas of our ESG program worth additional focus. First, health and wellness considerations of our building occupants are critical, and we have ramped up the ways that we standardize providing healthy spaces through our recent commitment as a Fitwel Champion and pursuit of Fitwel’s Viral Response Module.
Second, the pandemic highlights the importance of our social programs, most importantly our engagement with various stakeholders. Our resident and employee engagement programs have been critical to ensuring we have strong lines of communication with our residents, that we receive and respond to feedback from various stakeholders, and that our employees feel safe and supported through unique operating conditions.
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What’s next for sustainable investing in the near future at WashREIT?
Riffee: Up next, we’re exploring on-site renewables at several multifamily properties, which we think is an exciting opportunity to deliver new clean energy resources while also achieving attractive returns on these capital projects. And we are regularly evaluating opportunities to incorporate energy efficiency, sustainability and climate risk mitigation investments as part of any future acquisition.
