A good collection of lectures on real estate finance from Columbia University’s real estate program.
Via A Student of the Real Estate Game
Is this one solution to the challenges of FHFA vs. PACE? The Living City Block program takes a larger, cohesive geographic area and provides funding and empirical guidance to improve the functioning of a city block.
Urban Planning Experiment Coming to 14th and U – Housing Complex – Washington City Paper:
“Here’s how it works: LCB puts in the ‘soft costs’ of bringing in property owners, studying the project area, and coordinating with local politicians and government agencies to integrate power, water, and waste systems. Since the businesses themselves need to put up the capital expenses, though, the initiative depends heavily on making the business case for things like solar panels, geothermal heat, energy efficient piping, and permeable sidewalks. It’s a very easy case for large structures, like the Empire State building. Smaller buildings need to work together to create economies of scale, but older buildings are especially worth saving, since they possess the kinds of walls built for an era before air conditioning. “
Without diving too far into it, if you’d like to learn more about PACE and how to structure these programs from a DOE perspective (including various DOE loan guarantees), read the transcript of this webinar: Solution Center: Structuring Credit Enhancements for Clean Energy Finance Programs (Text Version)
A more visible example of the type of discussion you’ll find at GBA. Here’s a portion of an excised chimney, suffering from efflorescence (the white brick is caused by deposits left by evaporated water), long-term neglect, and probably water infiltration of the chimney prior to its removal.
What’s causing this brick to deteriorate? | GreenBuildingAdvisor.com.
If you’re not taking advantage of Green Building Advisor’s Community Forum, you’re missing an ongoing course about building science for non-scientists.
Here’s a link to some nuggets on multifamily compartmentalization:
Compartmentalization in high rise multifamily buildings | GreenBuildingAdvisor.com.
For anyone working with tax credits, the Novogradac podcast “Tax Credit Tuesday” are a useful way to learn about Federal and state initiatives in the tax credit sphere. I’ve always subscribed via iTunes, so I had no idea there was a PDF transcript available.
In this week’s podcast, Novo reports on Rep. Frank’s “TARP for Main Street” proposal, which would direct $1B of dividends from banks that received TARP funding to the Affordable Housing Trust Fund, established last year in the Housing and Economic Recovery Act.
Also covered is a letter from the Affordable Housing Tax Credit Coalition expressing concern about the potential sale of tax credits held by Fannie and Freddie. The AHTCC, providing Congress with a short lesson in supply and demand, is concerned that the sale of tax credits on the secondary market will further depress prices that currently languish between $0.68-0.78 per $1 of tax credit. Instead of selling the credits, AHTCC advocates for the Treasury to accept GSE-held LIHTC as part of the dividend payments owed. Alternatively, AHTCC suggests that credits be sold to LIHTC investors who have been inactive for 10+ years and that the GSEs should immediately reinvest those proceeds back into LIHTC.
Way out West, water use issues are much more pertinent than they are in the East. Well, maybe. [National view from Drought Impact Reporter.]
Regardless of location, water usage will be reduced through legislation, co-option, construction, or consumer choice.
To help us along, Multifamily Water Systems appears in the May issue of Builder News to provide definitions, discuss existing technology, and identify current and proposed legislation. It’s a strong article that covers a lot of ground.
Where should you look for this reusable water? On your structure, upon undeveloped land, and within the units:
Reusing water requires a water source like those above and then a transport system to put the water where you want to use it. If you plan to do more than irrigation, you’ll probably need to create sediment or UV filters. For rain barrels you should expect an 80% capture rate.
A couple of interesting projects are mentioned in the article:
Monterey Bay Shores, 341 hotel and residential condominium units with a rainwater catchment system for nonpotable laundry and irrigation use, a graywater recycling system, and Low Impact Development designs such as bioswales and porous sidewalks that will capture and treat 100 percent of all stormwater runoff for onsite use and infiltration. The graywater recycling system, which had to overcome California’s regulatory codes to gain approval, will include mechanical and biological waste treatment systems that will treat graywater for reuse in toilet flushing, irrigation and other nonpotable uses.
Sycamore Ten Point Five, in Charlottesville, VA, a mixed-use development including retail, commercial office space and 16 residential units. The system will include three oversize stainless steel domes positioned on the rooftop with a capacity for capturing and storing 270,000 gallons of annual rainwater. This water will be conveyed into the building via a gravity-utilized distribution system for nonpotable use. Water movement and delivery within the building will be controlled through computer programs in order to achieve the most efficient usage. Collected rainwater will be allocated toward toilet flushing, fire suppression, and watering plants in a series of aquatic trellises that will be located on the sides of the building. These trellises, which will make up a permaculture installment, will utilize evapotranspiration to cool the sides of the building.
Even with renewed focus on water issues (via mandate or LEED requirements), reuse of water or even mere collection of water can run afoul of regulations. Nevertheless, making better use of the water, even if only to keep mulch in the beds and surfaces free of puddles requires little to no outlay and is highly recommended for aesthetic and practical reasons.
[Note: The Virginia Department of Forestry provides a good technical guide to garden gardens, including siting, construction, and plant selection.
Finally, I've seen the AquaBarrels in use in the field and at EcoBuild. I found them to be well constructed and the owner quite knowledgeable about SFH and TH installations.]
I’m finally beginning a series on GAO’s “Green Affordable Housing” evaluation of HUD’s sustainability efforts. 
[Among the many recommendations GAO makes is that HUD collect more and better data about operational costs. The GAO recommendation does not highlight specific data to be collected, but using the LEED v3 "Whole Building Energy and Water Use" requirement: per page 19, it looks like it's just 5 years for LEED-CI. More to come on that.]
GAO wrote the report in part because “[HUD] spends an estimated $5 billion—more than 10 percent of its budget—on energy costs, either directly in the form of public housing operating subsidies or indirectly through utility allowances and contracts for assisted multifamily housing. [HUD] does not have the data necessary to understand the breakdown of these costs or the potential savings opportunities of green building for
many of its programs.”
HUD already provides resources and training and a very, very modest financial incentive to pursue energy efficiency. What I like about the GAO report is its emphasis on using NGO, regional and national sustainability measurements and cribbing the state-level LIHTC incentives for use in HUD projects. This would encompass water use reductions, sustainable material use, and indoor air quality improvement in addition to promoting energy efficiency.
GAO also reminds us that HUD can exercise financial levers: directly through debt financing, Community Development Block Grants, HOPE VI; and indirectly through its support for PHAs and Housing Assistance Vouchers. In addition, HUD’s Office of Policy Development and Research promotes building science and the advancement of durability, energy efficiency, and affordability of housing.
Unfortunately, standard who-pays-for-what conflicts arise in HUD’s relationships with local Public Housing Agencies (PHAs). Writes the GAO:
Some HUD programs offer incentives for energy conservation measures. PHAs receive funds from HUD’s capital fund that may be spent on energy conservation measures, but HUD officials told us that these funds are generally insufficient to cover both the up-front cost of many energy improvements and ongoing repair needs.5 HUD’s operating fund standard rules provide a disincentive to implementing high-cost energy improvements. According to HUD officials, a PHA’s annual operating subsidy is based in part on the prior 3 years of utility consumption, which would be expected to fall in the years following such improvements. This “3-year rolling base” policy allows PHAs to retain 75 percent of savings from reducing utility consumption over a 3-year period, but according to HUD officials, PHAs cannot retain enough savings over this short time to recoup the up-front cost of many large energy efficiency improvements such as high-energy-efficiency boilers.6
It should be noted that these large-scale sustainability initiatives can be met through the use of an energy services company (ESCO) such as Honeywell. Recent regulatory revisions by HUD have improved the processing of these contracts, allowing faster review and longer payback periods. Per the GAO, 195 ESCO contracts were in place in 2007, saving an estimated $50mm annually.
Overall, GAO provides sensible, affordable recommendations for further action. HUD should use third party mechanisms for efficiency benchmarking, collect sufficient information from Section 8 projects and residents, and emphasize (and reward) energy efficiency when awarding grants or in its various lending programs.
These recommendations could have a welcome and systemic impact upon all of multifamily construction, portfolio operation, and lending. We’ll talk more about this in subsequent posts.
UPDATE Presentations from the 2009 Apartment Internet Marketing Conference are now posted.
The conference season is well underway and I, among many others, am not traveling frequently. Nevertheless, I am very interested in tracking the sessions at the ACI/American Comfort conference, the Apartment Internet Marketing Conference, and the American Planning Association’s National Conference.
Thanks to the hashtag (#) feature of Twitter, I can follow conversations, receive session highlights, and find blog posts that provide even greater detail. You don’t need a Twitter account, just visit search.twitter.com and type in the event name. A search will usually reveal the #hashtag being used for a particular event.
Once you know the #hashtag, you can type it in and pull up all posts (aka Tweets) related to that event. In this case, I’ve searched for #aci09, or the Affordable Comfort conference.
If you have a Twitter client for your desktop (such as Tweetie, Tweetdeck, or others) you can usually search from within the client for events like the Apartment Internet Marketing conference.
Perhaps the greatest benefit is that by identifying attendees at conferences of interest, you can then follow them in Twitter, email them for additional information, or just call them up.
This post just calls attention to a few housing design resources:
Image courtesy Tom Phillips, Seattle Housing Authority
Energy Circle’s “Interconnected House” (many good resources here)
Affordable Housing Design Advisor
Seattle Housing Authority provides summaries of projects, including a presentation on their financial model and urban design.
Finally, I purchased ($12 at Target) and installed Waterpik’s EcoFlow 1.5 gpm showerhead this weekend. It took about 3 minutes to install from start to finish and provides excellent pressure by using outside air to improve water flow. I can certainly recommend these for multifamily installation.
I’ve written before about Energy Efficient Mortgages. The folks I spoke with at HUD felt the product was not particularly successful for reasons such as lender acceptance, difficulty of estimating savings, and general disinterest.
Now comes HUD ResearchWorks to highlight a renewed push via the Housing and Economic Recovery Act of 2008. In addition to the usual ‘tasking of HUD’ laundry list, HERA 2008 increases the approved cost of the energy efficiency upgrades to 5% of the property value from the previous cap of $8000.
I am hoping to catch up with some more HUD folks either at NBM or at December’s EcoBuild and provide additional information.
Buildings.com has a good entry in Mychele Lord’s multi-part series on sustainable issues in real estate, “It’s a Bigger Deal than You Think, Part 3: Operations”. One of the recommendations I found thought provoking was her admonition to plan before purchasing.
“Start thinking about waste disposal at acquisition. When negotiating purchasing contracts, address end-of-life recycling.”
This is useful not only for everyday items, but also for the waste-generating items like appliances, paints, and carpets. The tremendous number of carpets — we annually replace about 20% in my LIHTC portfolio — generate a stunning amount of waste. There are a couple of ways to recycle carpets, but so far, the network is very patchwork. You can learn more at CARE.
Ratcliff Architecture of Emeryville, CA and Alameda County (via Build Green Now/Stopwaste.org) jointly sponsor Green Matrix, a well-designed and researched website for sustainable decision making throughout the design and construction process.
After selecting an area of interest from the eponymous matrix, the site then serves up a summary of the concept with direct links to other resources. Many of the links can be found on stopwaste.org but others lead to IFMA (International Facilities Maintenance Association), USGBC, and other industrial resources.
Lots of discussion about the increasing use of sustainable guidelines and controversy over the refinement of these same guidelines. There’s also plenty of anecdotal comments about what the current real estate recession might mean for green building here in the US. Better and more complete coverage can be found at:
1. Jetson Green
So while others talk about spreading, revising, and postponing, here are two ways to keep track:
1. The new AIA white paper, “Local Leaders in Sustainability”
2. The original clearinghouse, Database of State Incentives for Renewables & Efficiency (DSIRE)
HT: Facilities Net
I’ll be posting links to The Cooperator periodically. The Cooperator is a free publication from Yale-Robbins and targets managers and residents of condos and co-ops. Information includes guides to hiring building staff, insurance coverage for co-op boards and directors, and building retrofits. Information is well presented, provides additional resources, and is applicable to all types of multi-family housing types. The archives are free and I highly recommend it.
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