Saving money on energy is more important than ever in uncertain economic times.
As every day seems to bring surprising headlines, apartment owners, developers, and managers are investing in technologies that make their buildings more resilient and more efficient.
Advances in technology have made hardware like smart thermostats, wireless sensors, and even solar panels much less expensive. Artificial intelligence (AI) systems can knit these technologies together—gathering data, remembering resident preferences, and helping owners and managers operate their communities to get the most out of every dollar.
“The software systems, the connectivity, the hardware: All of these things have gotten precipitously cheaper,” says Thomas Stanchak, managing director of sustainability for Stoneweg, a multifamily company based in St. Petersburg, Florida. “These technologies have become more and more feasible and accessible.”
Managers Find Best Renovations With Data
Apartment companies like Greystar have used AI systems to identify upgrades that save enough energy to quickly pay for themselves.
“Greystar tracks energy, water, and waste data on most managed apartments,” says Chris Laughman, senior director of energy and sustainability for Greystar. “Operators and regional leadership use this insight to prioritize capital projects that coincide with ownership goals.”
Many of Greystar’s residents are willing to pay higher rents to live in a certified green or sustainable community—an additional $79 per month, according to survey responses collected in 2023. Nearly two-thirds, 63%, indicated interest in living in a community with a sustainability or green certification. Among them, 6% would not live in a community without such certification, according to the survey.
Across Greystar’s 20 largest apartment markets, interest in sustainability was highest in Boston; New York; California’s Sacramento and San Jose; and Seattle, says Quinn Eddins, managing director of research for Greystar.
Respondents in Atlanta; Dallas; Phoenix; Raleigh, North Carolina; and San Antonio were the least likely to prioritize sustainability or green certifications when choosing an apartment.
AI systems can help companies identify opportunities to make buildings more efficient and resilient. Greystar uses an AI system created by Audette, a technology company based in Victoria, British Columbia.
The system combines data such as a property’s footprint, aerial imagery, building standards, age, and information from similar buildings to create a unique energy model for each analyzed site. It even considers the grid’s own carbon footprint and how it is projected to change throughout the life cycle of the building.
AI can find patterns and correlations in all this data that help identify specific renovations that meet the needs of the property owner, whether it wants a certain yield on their investments or to comply with local laws demanding they “decarbonize” or face fines. Many large cities have active or proposed building performance standards, including Boston, Denver, and New York City. About a third of the U.S. gross domestic product is produced in jurisdictions that mandate carbon disclosures for large businesses, such as REITs, according to Audette.
Many apartment lenders and equity investors also have standards for the buildings they invest in, ranging from how much energy the building uses to the total carbon released into the atmosphere from building activities. “It's becoming that if you want to raise money you have to have an understanding of your exposures to these risks,” says Christopher Naismith, CEO of Audette.
An AI system can assist building owners with identifying renovations that can help their properties access capital from more potential sources. An AI system can also quickly identify opportunities that many might miss.
For example, a heat pump system can often heat water three times more efficiently than a comparable gas system, at a slightly higher cost for the equipment. But property managers often replace expensive gear like hot water heaters when they fail—when there is no time or money budgeted to order a slightly more expensive but much more efficient system.
“Any human engineer could tell you any of this stuff,” says Naismith. However, a formal energy audit of a property can cost upward of $10,000. “The problem is not necessarily that it is unknowable—it is that it's expensive and slow [to identify these opportunities].”
Stoneweg Saves Energy at the Clubhouse
Multifamily owners don’t need to make a massive investment to bring AI systems that save electricity and money into their properties.
Stoneweg has installed AI systems to control the lights and thermostats in the clubhouse buildings at eight of its multifamily communities.
“You can get a networked building automation system in a box for a few thousand dollars,” says Stoneweg’s Stanchak. “This kind of technology is essentially free at this point, it’s so cheap.”
At each clubhouse building, the system includes a set of wireless gear. There is a smart thermostat to control the heating and air conditioning system. Plug load controls turn on or off electric devices. Coin-sized sensors detect whether someone is present and report on the temperature and humidity. Finally, a network device communicates with all this gear over a radio frequency like the one used by Bluetooth devices. This network device also has its own cellular antenna, so that it does not need to rely on the wireless internet service at the property.
A building automation system like this immediately begins to save energy, says Stanchak. When no one is present it dims lights or turns them off, and it cuts the power to devices like television monitors. TVs, in particular, can be energy vampires, using electricity even when their screens are dark to monitor radio frequencies for a signal from a TV remote control. As soon as someone approaches the clubhouse, the lights, televisions, music—whatever the property managers have chosen—turn on to welcome the resident.
All this wireless smart gear is also connected to an AI system that remembers how residents behave.
“It starts predicting,” says Stanchak. “If you’ve got somebody who five days a week works out at 5 a.m., it starts cooling the room at 4:30. It turns on the TVs before they come in.”
The simplicity of the system is part of its appeal. Stoneweg is an asset manager of a portfolio of about 11,000 apartments located in mostly in the Sun Belt and the Midwest, for clients that include large private equity firms. Often, when Stoneweg begins to work with these properties, the capital expenditure budgets have been set and investors have already promised a certain investment yield within a certain time.
“I focus on the next three to five years and what are the most accretive things to do,” says Stanchak. These building automation systems in the clubhouses fit right into the plans of Stoneweg’s clients. “It’s a great payback. … like a 30-month return on investment.”
The systems are relatively easy to install. The maintenance teams at each of his eight properties were able to plug in all the gear in about an hour, says Stanchak.
The property managers did not need to spend any time to integrate or secure the new system. It isn’t connected to the customer relationship management system for the portfolio where all the information on residents is stored. Instead, it can communicate with property managers through an app or by text messages or emails.
He plans to bring these systems to more apartment communities. “It’s easy to do. It’s low cost, and it starts saving energy immediately.”
Stop Frozen Pipes With Wireless Sensors
Smart thermostats and inexpensive electronic sensors can also help prevent thousands of dollars in damage from frozen pipes.
“Our system immediately alerts staff in real time should temperatures inside a unit fall below acceptable levels,” says Andrew Stewart, founder and chairman of Venterra Realty, a developer, owner, and operator of about 90 mixed-use and multifamily communities in its portfolio. “This allows our teams to intervene before pipes burst.”
Apartment communities spend an average of $1,600 on each major water leak, though costs can go as high as $15,000 or even $30,000 in extreme cases, according to Isaiah DeRose-Wilson, chief technology officer for SmartRent, a technology company based in Scottsdale, Arizona. Property managers that use SmartRent’s systems typically deploy eight to 10 sensors in each apartment and have avoided about 130,000 major leaks in the last year, along with even more minor leaks. Preventing those leaks probably saved about $200 million in water damage, says DeRose-Wilson.
BLDG Creates Super-Efficient, Luxury Condos
At Atelier Residences Miami, an AI agent will manage turning the lights on and off, setting the temperature for the air-conditioning unit, placing work orders for residents, and even managing their calendars.
“You’re going to see a proliferation of AI agents,” says René Bello, founder and CEO of BLDG Ventures, based in Miami. BLDG will start construction in the second half of 2025 on 148 condominiums at Atelier. The new development is expected to open in 2027.
Each unit at Atelier will combine features of a luxury hotel suite and a high-end condominium. When the owner of the unit is present—or even a repeat guest—the Atelier AI agent will remember their preferences from earlier stays and adapt accordingly.
It can set the lights and air conditioning to turn on at a resident’s preferred level when they arrive home, using a hotel-style key card or the Atelier app on their smartphone to open the electronic lock on the front door.
Motion sensors detect whether anyone is still in the room. After 30 minutes, it can dim the lights, and, after an hour, it can turn them off. On a smaller scale, motion detectors sense when a resident gets out of bed during the night and turn on accent lights that won’t wake anyone else. The AI agent can also eventually learn to tell the difference between a human getting out of bed and a pet.
All these features save electricity over time.
“We’re giving you all these bells and whistles, but we’re actually saving money,” says Bello. “And I’m expanding the shelf life of everything.”
As the AI agent learns the behavior of residents and guests, it can notify Atelier managers of potential issues, such as water leaks. For instance, it can detect if water is running at an unusual time or for an unusually long duration.
The system can also tell if the air conditioning is running at the same time a window is open thanks to a small contact sensor with a wireless connection to the system.
“If the window has been open for an excess of 20 to 30 minutes, the AC’s going to stop,” Bello says. That saves some electricity. In addition, it helps to protect the air-conditioning unit from droplets of condensation that can develop if it pulls too much humid air from outside through its cooling system.
“Mildew starts to build up,” says Bello. “If that goes on for long enough, it just destroys the AC unit.”
Solar Energy Technology Also Becomes Cheaper
It’s not just AI systems and wireless smart gear that have become much less expensive than they were just a few years ago. Renewable energy systems like solar panels are also much cheaper, thanks to improved manufacturing processes and advancements in materials.
“We recognized an opportunity to bring this technology to one of our multifamily properties,” says Jane Cohen, vice president of corporate responsibility and communications for Dermot Co., an apartment firm headquartered in New York City.
Dermot recently installed a $1.7 million solar energy system on the unused rooftops of two parking garages at Cordoba, a 454-unit luxury apartment community in Doral, Florida, in partnership with leading global real estate investment manager BGO. At full operational capacity, the panels are expected to produce enough electricity to provide more than 50% of the energy needs for the property’s extensive amenity spaces and common areas.
“We approximate a 10-year payback for the Cordoba project,” says Cohen. That includes federal Investment Tax Credits provided under the Inflation Reduction Act of 2022, which can cover 30% of eligible costs. “With the panels expected to last 25 years, that is a large economic benefit over the lifespan.”
Stoneweg also installed solar panels at six of its properties in 2024. “For solar, the cost per watt has dropped and dropped and dropped,” says Stanchak. “It’s expected to drop 3% annually for the next few years.”
It had originally planned to bring solar panels to 12 communities. “When it came to evaluating bids, those investments ultimately at that point did not make financial sense,” says Stanchak. For example, several of the buildings did not have enough available rooftop space so Stoneweg would need to build a new structure like a canopy or a carport to support the solar array.
The other six solar panel investments that Stoneweg completed produce enough electricity to fully pay for the cost to purchase and install the solar panels in five years.
Stoneweg is planning its next set of investments in solar panels. This time it may use Audette’s AI system to help identify which projects are likely to yield the best return on investment—without needing to seek bids from contractors first.
Audette draws from data like the address of a property, local climate data, and satellite images. It also considers building code data for the year the property was placed in service. With all that information, the system should be able to help Stoneweg identify properties where solar panels get enough light to function efficiently and where there is enough room on the roof to support the panels, says Stanchak.
