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Real Estate Journal — Mid-Year Review — June 23 - July 13, 2017 — 13C
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The Community Preservation Corporation UnderwritingEfficiency: RealizingEnergy&Water Efficiency Opportunities in Multifamily Housing T he Community Pres- ervation Corporation (CPC), along with a con-
ervation Corporation. “CPC’s Underwriting Efficiency hand- book gives lenders a resource of information on the benefits of efficiency improvements, how to discuss it with owners, and how to incorporate the savings into the underwriting process so they’re accessible for everybody. We believe that Underwriting Efficiency is a replicable model that can be a game-changer for how the multifamily lending industry does business.” With such prevalent influence over the economics and condition of our housing stock, the lending industry has a tremendous op- portunity to take the lead in ad- vancing measures that will not
only improve loan performance and mitigate risks, but also im- prove the financial and physical quality and sustainability of the buildings and communities in which we live and work. The cost savings associated with energy efficient construc- tion and retrofits play a key role in ensuring the long-term economic stability of multi- family properties, which is critical to the preservation of rental affordability in our com- munities. “Greener” buildings cut down on energy consump- tion, have smaller carbon foot- prints, and provide a host of long-term benefits for owners, residents, and communities.
However, significant barriers exist for many owners who may be interested in including en- ergy efficient measures in their properties. From systems to maintenance, size, and location, there are a multitude of factors that can make it difficult to fig- ure out the most effective way to increase a building’s energy efficiency. The Underwriting Efficiency handbook provides lenders with a resource of infor- mation on the tangible benefits of efficiency measures, how to discuss the topic with owners, and how to incorporate the potential savings into the un- derwriting process. Maintenance and opera-
tional costs for multifamily buildings are expensive, and energy and water efficiency improvements can reduce an- nual energy bills by 15-30% and water bills by 15-50%. Borrowers who use mortgage loan proceeds to finance efficien- cy improvements gain access to low-cost, long-term capital; bet- ter loan terms; and marketabil- ity and retention. At CPC, we understand that the ability to develop the customized solution that’s right for you depends on lending professionals who see multifamily housing the way you do. That’s why we invest the time and energy to get to know you and your business. n
sortium of pri- vate and pub- lic partners, a n n o u n c e d l as t month the launch of “Underwrit- ing Efficien- cy: A Mort- gage Lender’s
Sadie McKeown
Handbook for Realizing Energy and Water Efficiency Opportu- nities in Multifamily Housing.” CPC created the handbook to serve as a free resource for lend- ers in their efforts to incorporate energy and water efficiency features into the financing of first mortgages for multifamily building owners. Underwrit- ing the potential savings and providing additional low-cost, long-term capital in the mort- gage, can help break down the financial barriers that building owners of all sizes currently face in implementing sustainable property improvements. The launch of this new industry tool took place at a panel discussion on the benefits of sustainability in multifamily housing that was hosted this morning by the Sal- lan Foundation. The Underwriting Efficiency handbook provides an overview of how energy and water ef- ficiency financing tools benefit lenders, owners, and residents. It also offers examples of ways to improve building efficiency based on financing goals and a step-by-step framework for integrating efficiency measures into the mortgage lending pro- cess. With this resource in hand, mortgage lenders can demon- strate to building owners the financial impact of investing in efficient multifamily buildings and remove barriers to financ- ing high performance build- ings and major retrofits. The creation of the handbook was a collaboration between CPC and its partners: Energy Efficiency for All, Association for Energy Affordability, Bright Power, En- terprise Community Partners, Environmental Defense Fund, Rocky Mountain Institute, and The Sallan Foundation. “The savings from energy ef- ficient property improvements can play a major role in the long-term economic stability of multifamily buildings, which is critical to the preservation of affordability in our commu- nities,” said Sadie McKeown, executive vice president & COO, The Community Pres-
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