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August 2017 — Multifamily Properties Quarterly — Page 37
ers overlap too much and competi-
tive advantage has become scarce.
In technology, it’s impossible to be
good at everything, and innovation
can’t grow when the ground is tram-
pled over by the herd.
The rumblings of disruption are
everywhere and it’s an amazing time
to be in the multifamily technology
space. We know that virtual reality
will have a major impact soon; we’re
just not sure where or how yet. It
probably won’t be in apartment
tours. Smart-home tech is coming
quickly and connected fixtures, locks
and appliances are going to shift
control to the resident. We just need
to figure out how to operationalize
these advancements. As technology
creeps in from other verticals, rent-
ers will insist we follow suit. We’re
collaborating with many clients on
creating smart leasing offices that
not only serve the leasing team and
residents, but also replace the need
for the old interfaces they’re stuck
with now.
And like the travel, hospitality,
online shopping and banking indus-
tries, we can certainly streamline
and automate the sales and leasing
process. We can adapt our software
to allow for location-based wayfind-
ing and data visualization, and we
can allow renters to select their own
apartments and take control of their
experience. After move-in, we can
support and integrate with the myri-
ad personalized service and delivery
apps coming to market.
To embrace this interconnected
future, we must shift our focus to
the end user’s experience. Technol-
ogy ultimately defines where value
is. To create fertile ground for dis-
ruption in multifamily, we should
obsess on the experience of the resi-
dents and the team of people serv-
ing them.
Walking the apartment asso-
ciations’ tradeshow floors, nestled
between the large islands, is where
the seeds of disruptions are bud-
ding. There you can find dozens
of technology providers who are
beginning to offer solutions to mul-
tifamily problems. To support inno-
vation, we should insist on seam-
less integrations in our technology
stacks. And we can move faster to
adopt and test new technologies
that find their way into our sec-
tor. In addition, we should provide
quick feedback to tell these innova-
tors how they can solve our needs.
It’s time to shake things up. V
There are other benefits to the
program as well. For example, you
have a marketability benefit com-
pared with a nonenergy-efficient
property with similar rents if your
utility cost to the tenant will be
less.
Graber’s advice to owners is to
keep in mind that they have to
recertify annually and maintain
the Energy Star score above 75 for
the life of the loan. So, designing to
meet a minimum score threshold is
risky because the design score is just
theoretical, born out of the State-
ment of Energy Design Intent test.
Once the building is constructed,
owners need to collect and certify
actual data. If the score is below 75,
they will have to remedy it. We do
not yet know what that will look
like from HUD, as the program is
still new. The bottom line is that the
design should have plenty of cush-
ion built in.
One challenge Graber has seen
with the program with respect to
refinancing existing properties is
that certain utility companies are
not willing to release information
about tenant energy use, which will
make it difficult for borrowers to
participate. Whereas, on the new
construction side, owners can place
a requirement to share energy use
information into the tenant’s lease.
However, “Rest assured that utility
companies in Colorado play nice
in the sandbox and gladly provide
data to property owners in a timely
manner, typically in a format that
is easily uploaded to Energy Star’s
Portfolio Manager,” said Graber.
• Certification institute perspec-
tive. At the cutting edge of building
energy efficiency is the Interna-
tional Living Future Institute, whose
Living Building Challenge is one of
the certifications that will qualify
for HUD’s Green MIP Reduction. The
Living Building Challenge is the
world’s most rigorous performance
standard for buildings, creating
ecologically restorative buildings
that give more than they take. For a
glimpse of the living buildings that
are the realization of this concept,
see
Although no one has yet com-
pleted the LBC in conjunction
with HUD’s Green MIP Reduction,
there are seven affordable hous-
ing projects currently using the LBC
Affordable Housing Pilot Program.
According to Alicia Daniels Uhlig,
policy director at the Institute, all
property owners could benefit from
the concepts created at the Institute.
She cites its concept of transpar-
ency labels, which are like nutrition
labels for the built environment,
and provide information such as the
construction material ingredients
(declare), organizational social equi-
ty (just) and building energy perfor-
mance (reveal). These tools are avail-
able to all projects – not just projects
pursuing LBC. The idea is transpar-
ency leads to transformation in the
built environment: If you know how
something is performing, you can
improve it as needed, or inspire oth-
ers by your example.
• Conclusion. HUD’s Green MIP
Reduction is working well as a mar-
ket incentive for developers to build
green projects. More subsidies like
this would help to move the market,
including non-HUD projects, toward
greater energy efficiency.
Developer Downs’ suggestion is
to create a deeper subsidy that has
a payback period inside of a typical
developer’s average hold time of a
property. For example, if a deeper
subsidy accelerated the payback
on a solar power system to inside
three or four years, many owners
would undertake the investment
on a purely economically rational
basis, putting aside that it is the
environmentally responsible thing
to do. As the Green MIP Reduction
program proves, these incentives do
influence development and can be
fiscally sustainable. V
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IN DOWNTOWN SUPERIOR.
Just outside Boulder and a short commute from Denver,
a vibrant, new Downtown Superior is taking shape. This
urban hub offers land for office and mixed-use residential/
retail, plus new office and retail space built to suit. The
area offers competitive economics, easy access to Denver
International Airport, an educated employment pool and
a sought-after location. It will be an energetic, eclectic
mix of retail, shopping, dining, entertainment and living—
walkable, sustainable and surrounded by acres of gorgeous
Colorado open space.
Fully entitled for up to 817,600 square feet of office,
retail and restaurant space; 1,400 residential units;
and 500 hotel rooms.
Visi
FRESH OPPORTUNITIES FOR BUSINESS,
RESTAURANTS, RETAIL AND MORE.
That’s a Superior idea.
Downs
Steiner