This story was originally published in Affordable Housing Finance.

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More than 550,000 multifamily units have been built or retrofitted under Fannie Mae’s green financing business since it was launched nine years ago.

To quantify the benefits of its green bonds, Fannie Mae conducted a study that looks at the projected impact on residents, the economy, and the environment.

Here are the key takeaways:

· Owners who made their properties more efficient are projected to recoup their investment within approximately six years on average, while tenants at these properties are projected to see annual utility expenses cut by 10%, or $145, on average;

· Properties are projected to reduce water use by 5.9 billion gallons, equivalent to the amount of water consumed annually by nearly 54,000 American families, and greenhouse gas emissions by 287,000 metric tons annually, equivalent to nearly 61,000 passenger vehicles driven for one year; and

· Newly constructed or retrofitted green multifamily buildings are estimated to have contributed $7.2 billion in workers’ income and $14.6 billion to gross domestic product and supported 170,000 jobs.

“We have been very focused from the beginning on data,” says Chrissa Pagitsas, vice president, Fannie Mae, who started the green finance program nine years ago. “The reason for that is when we started this business, this group, there were questions about if it really saves money or if there would be additional credit risk. How do we know this works?”

While other studies showed that energy-efficiency measures save money, they have been regional or limited in the number of properties analyzed. They weren’t on the national scale of Fannie Mae, says Pagitsas, noting that the government-sponsored enterprise’s green-financing borrowers have committed to invest $208 million in capital improvements to retrofit more than 2,000 properties.

She is proud of several results, including the savings that families are realizing on their utility bills. A $145 reduction per year may not seem like much, but low-income families often pay about twice as much as median-income families for their utilities, according to Pagitsas.“That’s an important number to bring down,” she says.

An energy- and water-efficient property can reduce costs and provide families with more money to spend on education, health care, and other needs.

It’s also striking that the improvements made by multifamily property owners is driving a macro-economic benefit for the country, Pagitsas says.

For every dollar spent retrofitting properties through a Fannie Mae Green Rewards loan, $1.85 is created in economic output, according to Fannie Mae.

From 2012 through year-end 2018, Fannie Mae issued $51.7 billion in green mortgage-backed securities and $6.1 billion in green-structured securities. Borrowers using the green program can underwrite a portion of their project utility savings to increase loan proceeds.

This year, Fannie Mae and Freddie Mac made a change that calls for borrowers using their green-lending programs to commit to saving 30% on their energy and water consumption, with half of that reduction having to be in energy use.

This story was originally published in Affordable Housing Finance.