Sustainable Real Estate : (Week 8) Strategies for a Sustainable Future)

1. Sustainable Real Estate: • (Week 8) Strategies for a Sustainable Future)

2. Topics • Strategies for a Sustainable Future • Present the concept of carbon neutrality • Explain the requirements and constraints of a green mortgage • Analyze and evaluate the risk considerations in green building or retrofitting • Create strategies that deliver sustainable solutions and convenience.

3. Part 1 Carbon Neutrality

4. What is Carbon Neutrality • Every time we travel or turn on our computers, we add greenhouse gases to the atmosphere. This is because most of the energy we use comes from fuels like oil, coal, and gas. Other types of energy, like solar and wind power, do not contribute to climate change. (http://www.windows2universe.org/earth/climate/neutral.html) • Being "carbon neutral" means removing as much carbon dioxide from the atmosphere as we put in. • Carbon neutral, or having a net zero carbon footprint, refers to achieving net zero carbon emissions by balancing a measured amount of carbon released with an equivalent amount sequestered or offset, or buying enough carbon credits to make up the difference. It is used in the context of carbon dioxide releasing processes associated with transportation, energy production, and industrial processes such as production of carbon neutral fuel. (http://en.wikipedia.org/wiki/Carbon_neutrality)

5. How Carbon Offsetting Works

6. Carbon Offsets • Start with the Carbon Calculator link below. Find out how much carbon dioxide is released by the things we do every day. • Then explore the list of projects that provide Carbon Offsets for anyone who wants to be "carbon neutral". Carbon footprint/calculator: http://www.nature.org/greenliving/carboncalculator/index.htm Carbon offsets: http://www.carbonfund.org/individuals

7. Carbon Offsetting • Carbon offsets are a form of trade. When you buy an offset, you fund projects that reduce greenhouse gas (GHG) emissions. The projects might restore forests, update power plants and factories or increase the energy efficiency of buildings and transportation. Carbon offsets let you pay to reduce the global GHG total instead of making radical or impossible reductions of your own. GHG emissions mix quickly with the air and, unlike other pollutants, spread around the entire planet. Because of this, it doesn't really matter where GHG reductions take place if fewer emissions enter the atmosphere. • Carbon offsets are voluntary. People and businesses buy them to reduce their carbon footprints or build up their green image. Carbon offsets can counteract specific activities like air travel and driving or events like weddings and conferences. http://www.davidsuzuki.org/issues/climate-change/science/climate-change-basics/carbon-offsets/

8. Part 2 Green Mortgages

9. Green Mortgages • A green mortgage simply is a type of mortgage that provides you a money-saving discount or a bigger loan than normally permitted as a reward for making energy-efficient improvements or for buying a home that meets particular energy-efficiency standards. So, it's easier for you to qualify for a loan. • Green mortgages hinge on the principle that a more energy-efficient home means lower utility bills and, as a result, greater income, qualifying a prospective homeowner to buy a more expensive house. Officially, the mortgages often are called Energy Efficient Mortgages (EEMs) or Energy Improvement Mortgages (EIMs). • Read more: Green Mortgages for Energy Efficiency and Energy Conservation • The Daily Green • @the_daily_green on Twitter | thedailygreen on Facebook

10. Green Mortgages Green, or “Energy efficient” mortgages, let you borrow extra money to pay for energy efficient upgrades to your current home or a new or old home that you plan to buy. The result is a more environmentally friendly living space that uses fewer resources for heating and cooling and has dramatically lower utility costs. The types of things that are covered include upgrades that you may have thought you couldn’t afford like double paned windows, tankless water heaters, modern HVAC systems, and new insulation. Green mortgages are a concrete way for families to both save money and make a large scale change in the way that they live their lives in regard to the environment. Green Mortgages, either as part of a mortgage refinance or added on to a new mortgage, are a smart way to pay for energy efficient features to your current house, a house that you plan to buy, or to get credit for the features that your new home already has.

11. Green Mortgages Here are a few facts that will give you an idea of how upgrading your home can help save you a lot of money and reduce your home’s carbon footprint: • Overall, heating and cooling accounts for 50–70% of the total energy used in the average American home. • 60% of the existing homes in the US are not properly insulated. • Updating your home’s insulation can save you up to 20% on heating and cooling costs or up to 10% of your total yearly energy bill. • According to the Department of Energy, energy loss from outdated windows accounts for nearly 25% of the annual heating and cooling costs for the average American home. • Even the most basic double-paned window can reduce energy use by up to 24% in cold climates during the winter and by up to 18% in hot climates during the summer. • In houses with central air and heating, about 20% of the air is lost due to faulty, outdated duct work. • A new Energy Star-rated dishwasher can save you up to 13 energy (the dishwasher accounts for 2% of your gas or electric bill) and as much as 1,200 gallons of water a year. • Programmable thermostats can save about 2% on heating bills and more than 3% on cooling bills. These numbers can translate into savings of up to $180 a year.

12. Green Mortgages: Types • Conventional EEM: This type of loan is offered by lenders who sell their loans to Fannie Mae and Freddie Mac. It is the most powerful of the EEMs as it allows you to borrow up to 15% of the home’s appraised value for improvements. • FHA EEM: This type of EEM is not as powerful as the conventional EEM, but you will be able to take advantage of the benefits of FHA financing. You can borrow up to 5 % of your home’s value (though not more than $8,000) or $4,000, whichever is greater • VA EEM: This version of the EEM Mortgage is for past and present military personnel and allows you to spend up to $6,000 for energy efficient upgrades when purchasing an existing home regardless of the value of the home.

13. Green Mortgages: Final Thoughts Green Mortgages can help you do the following: • Get money to invest in energy efficient upgrades for a new house. • Help you to qualify for a larger mortgage to pay for a house that is already energy efficient. • Qualify you for money for green renovations when refinancing a mortgage. • Make older homes more comfortable and more affordable with lower utility payments. • Help you to use less energy to maintain the temperatures in your home and therefore lessen you family’s footprint.

14. Green Loans for Small Businesses • Small Business Administration Loans including the 7(a) loan and the SBA 504 loan • State energy efficiency financing programs • Commercial PACE loans • Greening efforts and retrofits help improve the bottom line of any business with lower operating costs. • Consumers are more likely to patronize green businesses. • improve the bottom line for your business with lower expenses, and create a compelling reason for customers to choose you over a competitor.

15. Green Mortgages for Small Businesses Some things these programs can help you to accomplish: • Retrofit facilities • Purchase energy efficient equipment • Utilize energy efficient construction • Buy alternative fuel for vehicles • Replace a transportation fleet with hybrid and improved-mileage vehicles • Increase efficiency with a new HVAC, heat pumps, and insulation • Install energy efficient power and light bulbs • Utilize new sources of energy including wind, solar, and geothermal • Install energy efficient doors, windows, and skylights

16. Part 3 Risks: Opportunities and Threats

17. Green- Opportunities and Threats • A historic lack of public funding in urban areas has made it very difficult for cities to develop the technologies needed for sustainability. • Variances and conditional use permits are obtainable and should be aggressively pursued for integrated designs. Contractors complain that environmental regulations are ever increasing along with fines, insurance premiums, and liability, compliance, and clean-up costs (Glavinich, 2008). • It is difficult to estimate the costs of green building, because so many components are interconnected to strategically designing green.

18. Green- Opportunities and Threats • A study commissioned by the Stapelton Airport in Denver concluded that green upgrades added 6.5% to the sale price of $150,000 to newly constructed workforce homes (Means, 2011) and that the eco-upgrades would save $70–$100 per year in energy cost. I know what you are saying . . . A year? Is that all? Site issues must be carefully evaluated, because some designs are not suitable matches for a particular location

19. Green- Opportunities and Threats • Performance benchmarks should be written with dates and fiscal data to measure progress. • Owners must determine the green objectives for the project. Some may be out of their control, such as the state possibly mandating certain protocols, whereas others could be a matter of choice and be based upon financial capacity. • Aesthetics should match the community’s culture and socioeconomic preferences, and the overall budget should include the initial investment, future phases, operations, and ongoing maintenance (Calkins, 2012).

20. Risks to Building Green There are inherent risks in project delivery that can be lessened with buy-in from community leadership and education. A key component in sustainable design is attracting stakeholders. These should include: • citizens who currently use or work at the site; • walkers and joggers who pass by the site; • those who shop or have business interests near the site;

21. Risks to Building Green • government officials and those who have planning power; • landowners; • transportation experts; • environmental and other interest groups; and • leaders from neighborhood organizations. Issues in sustainability are often framed in ways that make the overall project burdensome (Timpson et.al, 2006) and very hard to understand for people not familiar with green building.

22. Risks to Building Green • Proactive approaches to green construction should include making the environment a key component in the developers’ business planning and day-to-day operations (Glavinich, 2008). • Real estate professionals entering the green building market and facing stakeholders must be sure to:

23. Risks to Building Green • define the mission of the project; • prepare the presentation for who is in the audience (partners, financing authorities, politicians, customers); • define what green means to the community and developers; • deliver statistics; • use positive messages to attract more interest; and • explain the commitment of the integrated design team.

24. References • Calkins, M. (2012). The sustainable sites handbook: A complete guide to the principles, strategies, and best practices for sustainable landscapes. Hoboken, NJ: Wiley.Glavinich, T. (2008). Contractor's guide to green building construction: Management, project delivery, documentation, and risk reduction. Hoboken, NJ: Wiley.Means, R. (2011). Green building: Project planning and cost estimating. Hoboken, NJ: Wiley.Parr, A., & Zaretsky, M. (Eds.). (2011). New directions in sustainable design. New York, NY: Routledge. Timpson, W., Dunbar, B., Kimmel, G., Bruyere, B., Newman, P., & Mizia, H. (2006). 147 tips for teaching sustainability: Connecting the environment, the economy and society. Madison, WI: Atwood.

25. Topics • Strategies for a Sustainable Future • Present the concept of carbon neutrality • Explain the requirements and constraints of a green mortgage • Analyze and evaluate the risk considerations in green building or retrofitting • Create strategies that deliver sustainable solutions and convenience.