Although multifamily buildings (i.e., apartment and condominium buildings) comprise only 6% of America's housing stock, they are responsible for 9% of the housing sector's energy consumption. A recent Rockefeller Foundation report estimated the potential energy savings in these buildings at 174 trillion Btu (British thermal units) per year. But billions of dollars in upfront investment will be needed to realize these savings (as well as significant cost savings from operations), in both the construction of new, energy-efficient multifamily buildings and the retrofitting of existing buildings.
IMT's Finance group works to push the envelope of a host of funding methods, such as private financing; bank loans; GSE and government mortgages; and tax credits. We also consider and evaluate more novel financing approaches. Some recent market-based financing solutions of interest are PACE, energy service agreements, on-bill financing, tax-increment financing, and energy performance contracts. IMT and MIT CoLab's recent report, Local Governments' Role in Energy Project Financing, aims to help building owners and cities weigh various energy efficiency strategies, and choose policies best tailored to the individual needs of each local market or building.
Leading industry research on multifamily finance includes:
- IMT and MIT CoLab's Guide to Local Governments' Role in Energy Project Financing
- IMT's Report on Energy Transparency in the Multifamily Housing Sector
- Deutsche Bank's Recognizing the Benefits of Energy Efficiency in Multifamily Underwriting
- ACEEE Apartment Hunters: Programs Searching for Energy Savings in Multifamily Buildings
Shown above: Via Verde / The Green Way, a new affordable housing development in Bronx, N.Y. Photo © 2012 David Sundberg/ESTO and courtesy of Bright Power, Inc.