When implemented both wisely and strategically, sustainable green practices have an enormous positive impact on the bottom line for a multifamily housing property.
While the elusive task of “achieving” sustainability in an existing property may seem daunting, there are small steps owners and managers can take to create a positive social impact while keeping costs low, resident retention high and the bottom line healthy.
Outside the Property
Strategies that improve the external environment of a property must be diligently researched prior to implementation. The needs of each community are unique and can vary widely depending on each property’s location.
For example, in drought-prone regions, multifamily owners and managers are increasingly conserving water through drip irrigation systems. This system waters plants around the property with restricted means and minimal runoff—thus leading to smaller water bills without sacrificing outdoor landscaping.
Drought-tolerant landscaping can offer even further benefits: transforming the landscape of a property from grass to turf or using drought-resistant plants avoids the use of water altogether and is often implemented for this reason.
Another outdoor sustainability strategy that is easily implemented is onsite recycling of common waste. Partnerships with trash or recycle valet companies can provide amenities that are becoming increasingly popular among renters.
In addition, designated electric car charging stations are another strategic amenity that contributes both to sustainability and resident satisfaction. These offerings are especially appreciated by residents in coastal states, where electric vehicles are most common.
Larger installations such as green roofs, parks and water features can also have a significant impact on a property’s sustainability and bottom line, as these amenities will often lead to rental increases. According to a recent report by ULI, some properties are garnering an additional $300 to $500 every month in rent for units that overlook green roofs and sustainable gardens.
For investors and owners, this means a more straightforward path to investment returns, as these green features often pay for themselves in the first two to three years of use and contribute for many years thereafter.
Within the Walls
Internal strategies can also have a positive impact on ROI, since sustainability practices lower overall maintenance, water and electricity costs.
Installing amenities such as smart thermostats can exponentially lower energy usage and costs. These thermostats function on a timer set by the resident, so the device only regulates temperature during hours the unit is occupied, and energy is not used when the apartment is empty.
Developers can also pre-install water-conscious washing machines and dishwashers in units to lower electric and water bills. There are corresponding low-flow shower heads, toilets and sink faucets property owners and managers can select which limit water wasting within the property as well.
These energy-efficient upgrades have a dual benefit: they not only positively impact the environment, but are also in high demand among renters. Apartments equipped with smart devices and green features typically command stronger rents, and aid in resident attraction and retention.
Connecting with Residents
Beyond physical applications of green strategies, sustainability initiatives also give multifamily owners and managers a new opportunity to connect with residents in a positive way.
Savvy property managers are increasingly creating platforms through which they can communicate and educate residents about sustainability programs and their benefits.
For example, managers can foster an online blog with useful information to help residents understand the benefits of going green for themselves and the environment. Portals like this demonstrate ownership’s commitment to both the property and the overall environment, garnering a sense of community among both prospective and current residents.
The Bottom Line
Sustainability initiatives need not be complicated to be effective. Simple, well-planned strategies can deeply impact a property’s environmental footprint, while also positively impacting resident relationships and overall NOI.
By implementing the right green strategies for each multifamily community, owners and managers can drive rent growth and resident retention—quickly re-paying the initial investment for green amenities. From water conservation to healthy recycling practices, smart appliances to green-focused online forums, sustainable practices are more in-demand and easily implemented than ever before.
Ultimately, fostering green living in a multifamily community offers managers the opportunity to create a positive impact on the lives of residents as well as the environment in which they live, while also delivering stronger returns to property owners.
Cindy Wick is the regional vice president of Western National Property Management, the residential real estate management arm of Western National Group. Headquartered in Irvine, Calif., Western National Property Management currently oversees the management of 179 communities and 24,801 units throughout Orange County, the Inland Empire, Los Angeles, Northern California and Las Vegas.