Investment Strategy
Efficient, Affordable, and Profitable FOR INVESTORS IN AFFORDABLE HOUSING, LOOK TO ENERGY EFFICIENCY TO INCREASE PROFITS.
JON KROPFL
F or investors in Affordable are limited by regulation, while operating expenses (i.e. utilities,
efficiency. Studies show that most commercial and multi-family buildings overspend 20–40% on utilities each year. These costs quietly erode net operating income (NOI) and drag down long-term property valuations. For Affordable Housing investors, reducing that waste represents a direct path to profitability, asset appreciation, and improved tenant satisfaction. This article explores why energy efficiency should be on every Affordable Housing investor’s radar, what solutions provide the greatest
return, and how renewable energy can layer on even more savings.
Housing, profitability is often a balancing act. Rent increases
THE HIDDEN IMPACT OF ENERGY COSTS
maintenance, insurance) continue to rise. That reality makes every efficiency gain crucial. Unlike in market-rate housing, where owners can rely on rent growth to improve returns, Affordable Housing investors must look within for opportunities to strengthen cash flow. One of the most powerful yet underutilized strategies is energy
Energy costs are often treated as a fixed line item in a property’s budget. However, they are one of the most dynamic and controllable expenses in real estate. Consider a mid-size Affordable Housing property spending $200,000 annually on utilities. If that building is overspending by even 20%, that’s $40,000 of potential savings left on the
28 | think realty magazine :: december - january 2026
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