Every day, multifamily apartment communities boasting lush, green, grassy properties could be wasting away thousands of dollars in water, energy, and outsourced landscaping costs even as they strive to incorporate and install the latest environmentally sensitive products across their portfolio. According to a panel on cost-effective green redevelopment strategies, apartment owners and operators conducting a cost/benefit analysis of environmental initiatives could save hundreds of thousands of dollars by focusing on low-hanging, ROI-heavy efforts such as better landscaping choices and the use of minimal investment green products.
“We’ve reached a point where we are building buildings that function for the long-term that are affordable to live in, affordable to operate,” said Steven Winter Associates senior engineer Courtney Moriarta, who joined UDR senior vice president Doug Walker and Domain Cos. co-principal Chris Papamichael on the panel moderated by National Association of Home Builders (NAHB) senior vice president of multifamily Sharon Dworkin Bell. “Still,” Moriarta continued, “we can struggle to reach goals that are sometimes complementary and sometimes competing, including energy-efficiency, healthy environments, durable buildings, healthy occupants, and positive financial returns.”
At UDR, a key strategy in ROI preservation has been the development of an internal “green book” mapping out the green products, programs, philosophies, and strategies implemented across the company’s apartment portfolio. “It is always a struggle to educate and communicate,” Walker said. “If you want to take a successful green project and keep it that way overtime, a crucial point is the transition from the construction and installation team with your onsite operations. If you don’t effectively transition the elements and vision of your initiative to property management, you could have all new incandescent from the next light bulb salesperson who walks in with football tickets.”
Papamichael likewise stressed spending as much upfront time as possible prior to engaging in green initiatives to determine what is going to be both beneficial and possible from a costs and logistics standpoint. “There are a million things you can do, but you want to be able to narrow it down,” he said. “Common-area lighting with photo cell activation, water savings devices on toilets and showers, light fixtures, Energy Star appliances, low- and no-VOC paints and sealants... these are all great examples of techniques where the incremental cost increase is not that great.”
For firms not engaged in a full portfolio re-greening, Moriarta advised a concerted and comparative study of water, sewer, and energy costs per building, noting that most multifamily portfolios have wide differences in the efficiency of disparate buildings. Investments in efficient buildings logically have low ROI, and also steal critical green dollars from the assets that truly need them.
“It can be an eye-opening experience if you have not conducted an analysis like that yet to your portfolio,” she said. “Typically, there is a difference of one to seven from the lowest energy user to the highest, of something like five BTUS per square foot to 35 BTUS. Obviously, you want to go after the real energy hogs first.” One key area Moriarta suggested targeting: water usage and system leaks. “If your water bill is unusually high, get someone out to the property to read the meter at 3 a.m., and if it is moving, figure out why it’s moving right away.”
UDR continues to perform energy usage and cost analysis for units across the REIT's portfolio and is currently engaged in an effort to upgrade all apartments on the turn with programmable thermostats, compact fluorescent lighting, faucet aerators, and low-flow shower heads. “That costs about $150 per door,” Walker said. “The proliferation of the green movement has created a huge influx of new products and new manufacturing, and a lot of this stuff is getting cheaper and cheaper.”
Walker also noted that UDR is likely to begin posting monthly energy costs for all of its units on the company’s Web site. “We know that’s not a common practice to the industry, but we feel that offering the transparency and providing benchmarking information will only improve the operations and success of all of our efforts when it comes to sustainability.”