The Next Green
- Sep 30, 2019
We can see the future of sustainable multifamily design, and it looks like Sendero Verde. That’s the $223 million affordable housing project being developed by L+M Development Partners, Jonathan Rose Cos. and Acacia Network in the East Harlem neighborhood of Manhattan. When it’s complete in 2021, Sendero Verde will be the largest all-affordable community built to Passive House principles and will consume as much as 70 percent less electricity than comparable conventionally built properties.
From coast to coast, forward-thinking multifamily developers, operators and managers are taking heed of the movement toward reducing their properties’ carbon footprint and greenhouse gas emissions. The forces behind the trend are varied: stricter regulations, higher resident expectations and lower costs.
The movement is encouraging, in no small part because the multifamily sector has lagged its counterpart on the commercial real estate side in some crucial respects. A 2018 study sponsored by the Institute of Real Estate Management found some remarkable discrepancies. About half of multifamily operators—48.4 percent—reported implementing benchmarking in some form. By contrast, 73 percent of commercial property respondents said that they benchmark their properties.
Playing catch-up or not, the multifamily sector also has some formidable tools at its disposal. Take, for example, the robust incentive programs offered by the two GSEs. In 2018, Fannie Mae provided $50 billion in lower-rate financing in exchange for sustainability; Freddie Mac generated $36 billion in green financing. And in many locations, PACE offers a property tax assessment as a way to repay loans.
Multifamily operators have a once-in-a-generation opportunity to change the game for good. Plenty of options are at the ready, as are resources to put those measures in place. Perhaps the biggest decision is how far on the cutting edge to stand.
In this month’s Q&A with Holly Dutton, Deborah Moelis, a principal at Handel Architects and an authority on sustainable design, frames the issue this way: “If you really want to be a game-changer and make a difference, then you have to take some risks and do some different things that you’re not comfortable with, or that you’ve never done before.”
Here’s to leaving the comfort zone to embrace new risks and rewards.