Do good by doing well: how green financing benefits the 'Triple Bottom Line': Tenants, investors and the environment

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Author: Bob Simpson
Date: May-June 2017
From: Journal of Property Management(Vol. 82, Issue 3)
Publisher: Institute of Real Estate Management
Document Type: Article
Length: 971 words

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Sustainability and green initiatives, while good for the environment, are often perceived as more costly than the "old way" of doing things.

But in the case of green financing for multifamily properties, the c financing is actually more affordable than traditional financing. And as more investors are using green financing, they're discovering a surprising number of benefits they hadn't anticipated: better quality assets, lower tenant turnover, fewer tenant complaints and higher cash-flow.

Stratford Partners--a San Diego-based private real estate firm focusing on multifamily properties in the Western U.S. with a portfolio including approximately 3,000 units valued at around S350 million--is a case in point. Mark Hailing, principal and director of portfolio management, said that last year the firm closed two green financing deals.

He called those deals "game changers."

"What initially attracted us was that the terms were better than the standard options," said Hailing. "The interest rate was 20-30 basis points lower, which meant a few hundred thousand dollars more in proceeds," he added.

MULTIPLYING THE BENEFITS

The increase in net proceeds, however, turned out to be just the tip of the iceberg.

"By going through the process, we received a tremendous education on the utility efficiency of our buildings," he said.

Hailing and his partners said they gained expertise that they now apply to all properties in their portfolio. "Once we became educated about the value of green financing, we began tracking utility billing on all of our properties by...

Source Citation

Source Citation
Simpson, Bob. "Do good by doing well: how green financing benefits the 'Triple Bottom Line': Tenants, investors and the environment." Journal of Property Management, vol. 82, no. 3, May-June 2017, p. 18+. Accessed 26 Sept. 2020.
  

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