This article was originally featured on our sister site MFE.

It’s easy to understand what keeps the most expensive energy-efficient features out of multifamily units. With more than 75% of owners passing the costs for gas and electricity on to their tenants, in most cases—­minus philosophical views—a financial impetus is absent. But multifamily executive found four developers who say that, with the costs for such things as photovoltaic and geothermal installations dropping and more energy-saving products than ever suited to multifamily buildings, there are no excuses left for not “greening up.”

Each company, in its own way, is proving that ­designs earning LEED Platinum—and even Passive House—certification are expensive, but viable, regardless of who foots the bills for energy. Meanwhile, they’re setting an example for the rest of the industry. Here are their stories:

Cornell Tech Residential

Hudson Cos.

“With this project, it’s very important to our company that we feel we’re creating a legacy—one that helps to move the market in a new direction,” says Arianna Sacks Rosenberg, senior project manager for The Hudson Cos., a New York City–based development firm. At a whopping 314 kilowatts, Rosenberg says her company holds New York’s record for the largest solar array on a residential building. Now it’s pairing that achievement with the world’s largest Passive House–certified structure: a 270 foot-tall, 352-unit residential building for Cornell University. Rosenberg’s company serves as lead developer for the project, which culls together more than a dozen partners and is set for a fall 2017 completion.

In its request for proposals, Cornell specified a design for its new dormitory that makes it a “beacon of sustainability” for the school’s Roosevelt Island–based tech campus. The Hudson building will accomplish this by consuming as much as 90% less energy than other similarly sized buildings built to code.

Arianna Sacks Rosenberg, senior project manager for The Hudson Cos., at the top of the Cornell Tech Residential project, which is expected to be completed next fall.
Arianna Sacks Rosenberg, senior project manager for The Hudson Cos., at the top of the Cornell Tech Residential project, which is expected to be completed next fall.

In addition to the things you might expect—like LED lighting, occupancy sensors, and Energy Star–rated appliances—the building goes well beyond those basic measures to become as airtight and well insulated as possible. The exterior façade is up to 14 inches thick. The walls use R-19–rated mineral wool insulation, while the roof uses R-50 insulation. Wall panels were constructed off-site, where they were pre-fitted with triple-pane windows, at Eastern Exterior Wall System.

Contractors took no chances in potentially compromising the building envelope, adding separation between the interior and exterior walls while also using a self-sealing tape beneath the drywall that seals up around fasteners. The net result is a building that’s as tightly sealed and insulated as a Styrofoam cooler, which means each unit can be heated and cooled to within one degree of accuracy by nothing more than a network of pipes tied to centralized evaporators.

For multifamily development, make no mistake about it: The achievement is astonishing. But it’s something Rosenberg says wasn’t possible as little as five years ago, when her company had to forgo a Passive House rating on a smaller project in Brooklyn, because, she says, there simply weren’t enough products designed to support the Passive House concept in multifamily development. Now, she says that’s changed, thanks to an influx of products from Europe and Asia, including options for high-capacity energy recovery ventilation (ERV) units and variable-flow refrigerant systems designed specifically for multifamily buildings. As a result, Passive remains a lofty goal, but the Cornell project proves it’s finally possible on large-scale projects for developers who are willing to stretch their limits.

“When you ask a developer to do something truly innovative, that can be scary,” Rosenberg admits. “We don’t like to make every building the same, but we do have recipes that we lean on in order to make things work and to make them feasible.”

The Cornell project is expected to earn LEED Platinum certification.

Hanover Olympic


Net-zero remains financially out of reach for multifamily projects. But that hasn’t stopped at least one developer from testing the viability of going net-zero by having tenants knowingly pay for the difference.

“There is a cost premium associated with photovoltaic systems and other features, but there’s a break-even point,” says Ryan Hamilton, director of development for Houston-based developer Hanover Co.

Hamilton says his company weighed the possibility of creating net-zero apartments by viewing feasibility—not for the whole project—but on a per-unit basis and by attempting to pass the added expenses on to tenants who may be willing to pay extra for the feature.

The concept of carving out 20 net-zero, “green” apartments from a 263-unit building came from the top of the organization, in order to explore the “desire and demand for more institutionally green multi­family­ properties.”

Each unit at Hanover Olympic is tied to its own solar array, producing 4,700 kilowatt hours annually per apartment. Along with features like LED lighting; occupancy sensors; double-pane, argon-filled windows; and smart thermostats, the net result is zero energy usage over a 12-month period. To help reinforce the impact of its renter’s decisions, Hanover added to every net-zero apartment iPad-based energy monitoring systems.

Hanover Olympic’s tenants pay more for their net-zero apartments than renters of other units. And while the benefits of no energy costs help offset those expenses, Hamilton readily admits it’s no breakeven for net-zero tenants. But, approximately halfway through the leasing process, evidence suggests that—in Los Angeles, at least—some renters are willing to shoulder the difference.

Sage on Prospect

solar array atop multifamily building developed by Dominion
Dominion Properties

To achieve sustainability, some developers are ­including expensive features such as geothermal heat pumps and water heaters, all while adding luxury amenities in the same budgets. However, some property owners who include utilities in their rental rates say they’re able to generate enough ­energy savings to pay for them.

“Once you teach a landlord how to make a buck, they’ll never forget,” says Mike O’Connor, president of Dominion Properties in Milwaukee. “If we can show people that these energy improvements are also ­money makers, we can get others to follow suit.”

O’Connor says his company went out on a limb to produce Wisconsin’s first LEED Platinum multifamily­ building, partly to set the pace for other developers, but also as a means to increase profits. Dominion specializes in refurbishing existing buildings and includes heating and cooling with its apartment rates. For this reason, O’Connor says he started out making minor improvements to eke out as much savings as possible, like insulating hot-water pipes, increasing wall insulation, and swapping out old heating systems. When the time came to design and build from the ground up, he says his company went for broke with features such as solar arrays and geothermal wells, which modeling suggested will pay for themselves in less than a decade.

Dominion’s latest project, Sage on Prospect, employs a total of 24, 400-foot-deep geothermal wells and 29.45 kWh of solar power to offset the expenses of electricity, heating, and cooling by about $500 per month. At a cost of approximately $70,000, minus a $35,000 tax credit, O’Connor says the solar panels will pay for themselves in seven-and-a-half years. Meanwhile, he expects the geothermal wells, heat pumps, and water heaters to pay out even sooner. In the long run, both will equal higher profits.

“The average [single-family] homeowner is only in their house for seven-and-a-half years,” O’Connor says. “Chances are, we can’t rely on that segment [to reduce energy usage], because no one is going to make those up-front investments when they know they’ll only reap the benefits for such a limited number of years.”

For this reason, O’Connor, and other developers, say multifamily building owners hold the greatest opportunity—and responsibility—for posting housing-related energy reductions.

Brooklyn Yard


When going green, you’ve got to place features that help sell the concept front and center and remind residents every day they’re making a difference.

“In order for people to understand and relate to sustainability, they need to be able to see it,” says Brian Heather, CEO and founder of Solterra, a Portland–based developer. “It can’t just be hidden inside the walls.”

Partly for this reason, Heather’s company has made lush, living walls part of its brand as an eco-conscious developer. With Brooklyn Yard, a 46-unit building in southeast Portland, the firm also placed solar arrays not atop the roof but in a direct line of sight from the sun and residents, as overhangs on south-facing windows (where they also reduce heat gain in the summer).

And while none of the units in Brooklyn Yard is net-zero, those panels often produce enough power to cover energy use for the building’s elevator, as well as the common spaces, which are reduced by 15% through an inner courtyard design that harkens back to the U-shaped buildings built between 1880 and 1950 in Chicago.

The design also allows for cross ventilation through every unit, which can at times cut down on the need for cooling. But developers say you can’t rely on tenants to utilize those sorts of features in order to generate energy savings, nor will everyone find it to be comfortable. Instead, green buildings must achieve their marks while producing the same creature comforts as any other building—if not better. At the same time, sustainable living must be dead simple for tenants.

“We believe it’s our job as designers and builders to create places where people can live comfortably and not have to go out of their way to live sustainably,” Heather says. “We want them to live in buildings that are both functional and by default sustainable at the same time.”