Unprecedented Study Unlocks New Opportunities for Investing in Energy Efficiency in Multifamily Buildings

Image courtesy of Steven Winter Associates.


On January 11th, the Deutsche Bank Americas Foundation and Living Cities released a new study, “Recognizing the Benefits of Energy Efficiency in Multifamily Underwriting,” which lays the groundwork for a new means of financing energy efficiency retrofits. Authored by HR&A and Steven Winter Associates, the study examined a uniquely large and comprehensive multifamily dataset. Rigorous analysis produced a data-driven approach by which underwriters can benchmark auditors’ energy savings estimates and include such projections in their underwriting models in a way that greatly mitigates risk across a portfolio. The innovative approach would allow for larger loans to multifamily owners, increasing the availability of capital to unlock billions of dollars of energy savings potential in the nation’s multifamily building stock.


The study examined energy use before and after retrofits, as well as auditors’ savings projections, across an unprecedented dataset of 231 buildings, totaling more than 21,000 units of affordable housing in New York City. The report is available on the Deutsche Bank Americas Foundation website.


Living Cities provided a grant to the New York City Energy Efficiency Corporation (NYCEEC) to create a mortgage enhancement product that will allow multifamily lenders to underwrite loans inclusive of cash flows from projected energy efficiency savings. HR&A will serve as a key advisor to NYCEEC in the development of this new product.


This study is an example of HR&A’s core value-add for our energy efficiency clients: a deep knowledge of real estate development finance, rigorous analysis informed by partnership with a premier building science firm, and the ability to translate this multidisciplinary knowledge into transformative and practical policy recommendations.