Appealing to a ‘Green’ Renter: If You Build it Sustainably, Will Prospects Come?
- Oct 04, 2011
The key to getting renters in the door of a green community is knowing what they most value—and educating them about the environment you’ve created.
“People are very concerned about the indoor environmental quality of where they live,” says Michael Gubbins, vice president of residential management at Albanese Organization, the developer of the triad of LEED Platinum buildings in New York’s Battery Park City.
With that in mind, Albanese offers twice-filtered air in its apartments; all kitchens and bathrooms have exhaust systems, and all the products used in the buildings are environmentally friendly. “A lot of people have come through our building with families or newborn babies,” points out Gubbins.
Reducing energy and water consumption is also important to residents, so programmable thermostats and good insulation are features that Albanese offers in its communities, as are low-flow fixtures and a water waste treatment plant.
Gubbins notes that 40 percent of prospects visit the Solaire because of its sustainability, compared to between 15 percent and 20 percent that came when the building first opened in 2003. What’s more, he notes, the building’s turnover rate is 30 percent, compared to New York’s average of 50 percent. And, in a strong market, renters will pay a 5 percent to 10 percent premium (in a weak market, apartments continue to rent without concessions).
While Albanese’s approach has certainly worked, others view sustainability as a lifestyle
that is “triple-bottom-line-oriented,” encompassing the social, economic and environmental effects, explains Damin Tarlow, vice president of asset management at Portland, Ore.-based Gerding Edlen Cos.
While consumers are more educated about sustainability today than they have been in the past, there is still some confusion, particularly because, as Tarlow points out, “a lot of what sustainability is about is behind the walls. … The market really can’t see that stuff. … At the end of the day the more visible [the green features are], the better.”
With this in mind, Gerding Edlen focuses on features that prospects and residents can see and feel. “In a world where sometimes you have 15 minutes with [a prospect], you get more reliant upon the inherent design and the visibility of those features.”
At its LEED Platinum Indigo @ Twelve|West in Portland, for example, the company installed a wind turbine array—the first of its kind on a building in an urban environment. “They are unbelievably visible; I couldn’t buy PR like that,” notes Tarlow, adding, “We underestimated the impact it would have from a market point of view.”
In fact, Indigo launched in November 2009, and Gerding Edlen leased 40 units in December, beating its original lease-up projections from 2006.
Additionally, retention rates are well over 60 percent. “Turnover is where you start to see the market moving first,” Tarlow says. “The longer people live [at the Indigo] the more some of these layers of the onion start to reveal themselves.
“We learned a long time ago that you can’t layer sustainability on top of a building,” he adds. “It has to be integrated within how you think and operate and coordinate.”