The U.S. Green Building Council (USGBC) announced today that Fannie Mae will reward multifamily properties with a green building certification, such as LEED, with a lower interest rate. USGBC’s LEED green building rating system is one of several recognized certifications including Energy Star and Enterprise’s Green Communities Criteria.
For these certified properties, Fannie Mae is now granting a 10 basis point reduction in the interest rate of a multifamily refinance, acquisition or supplemental mortgage loan. For example, if the market interest rate is 4% on the multifamily loan, the new rate is 3.9% with this pricing break. On a $10 million dollar loan amortizing over 30 years, the owner would save $95,000 in interest payments over a 10-year term.
All loans financed under this lower interest rate will be also securitized as a Green MBS, growing the total volume of Green Bonds in the market for socially responsible investors to include in their portfolios. Fannie Mae is the leading provider of multifamily financing in the U.S., with a portfolio valued at more than $200 billion.
“This is a great demonstration of leadership from Fannie Mae, and the partnership between the multifamily finance industry and the green building industry,” said Rick Fedrizzi, CEO and founding chair, USGBC. “This is real money and an incentive to not only build green but also for existing buildings to achieve certification. For the first time, Fannie Mae multifamily lenders will be able to reward building owners for their better buildings.”
"Fannie Mae is leading the way in financing by offering new lower interest rates for green building certified multifamily properties,” says Jeffery Hayward, executive vice president for multifamily, Fannie Mae. “We clearly see the value in the triple-bottom line of certified green buildings: financial benefits of lower operating costs for owners and tenants; social benefits of better quality housing for renters; and environmental benefits for everyone. Our lenders are ready with financing solutions to help multifamily owners make their properties more energy and water efficient for today and for the future."
LEED buildings have been proven to have lower monthly energy and water costs, leaving more disposable income for families and creating healthier and more comfortable indoor environments for occupants. In a study from the U.S. Department of Energy it was reported that LEED buildings are estimated to consume 25% less energy and 11% less water, have 19 percent lower maintenance costs, 27 percent higher occupant satisfaction and 34 percent lower greenhouse gas emissions.
For more information on Fannie Mae’s Multifamily Green Initiative, please see www.fanniemaegreeninitiative.com.
Related Stories
| Aug 16, 2022
Cedars-Sinai Urgent Care Clinic’s high design for urgent care
The new Cedars-Sinai Los Feliz Urgent Care Clinic in Los Angeles plays against type, offering a stylized design to what are typically mundane, utilitarian buildings.
| Aug 15, 2022
IF you build it, will they come? The problem of staff respite in healthcare facilities
Architects and designers have long argued for the value of respite spaces in healthcare facilities.
| Aug 15, 2022
Boston high-rise will be largest Passive House office building in the world
Winthrop Center, a new 691-foot tall, mixed-use tower in Boston was recently honored with the Passive House Trailblazer award.
Architects | Aug 12, 2022
Goettsch Partners names James Zheng, CEO, and Paul de Santis, Co-design Director
Global architecture firm Goettsch Partners (GP) announces that James Zheng, AIA, LEED AP, has been named CEO, and Paul De Santis, Assoc. AIA, LEED AP, joins James Goettsch, FAIA, as co-design directors for the practice. As the primary partners in the firm, the three have worked closely together for more than 17 years. Goettsch will also continue to serve as chairman while Zheng now assumes the full CEO title as well as president.
| Aug 12, 2022
Monthly Construction Input Prices Decreased 2% in July, Up 17% From a Year Ago, Says ABC
Construction input prices decreased 1.8% in July compared to the previous month, according to an Associated Builders and Contractors analysis of U.S. Bureau of Labor Statistics’ Producer Price Index data released today.
Hotel Facilities | Aug 12, 2022
Denver builds the nation’s first carbon-positive hotel
Touted as the nation’s first carbon-positive hotel, Populus recently broke ground in downtown Denver.
| Aug 11, 2022
Report examines supposed conflict between good design and effective cost management
A report by the American Institute of Architects and the Associated General Contractors of America takes a look at the supposed conflict between good design and effective cost management, and why it causes friction between architects and contractors.
Architects | Aug 11, 2022
Mancini Duffy Bill Mandara on expanding through diversification
In this segment for HorizonTV, BD+C's John Caulfield interviews Mancini Duffy's CEO and Co-owner William Mandara about his firm's recent growth, which includes an acquisition and new HQs office.
Energy Efficiency | Aug 11, 2022
Commercial Energy Efficiency: Finally “In-the-Money!”
By now, many business leaders are out in front of policymakers on prioritizing the energy transition.
High-rise Construction | Aug 11, 2022
Saudi Arabia unveils plans for a one-building city stretching over 100 miles long
Saudi Arabia recently announced plans for an ambitious urban project called The Line—a one-building city in the desert that will stretch 170 kilometers (106 miles) long and only 200 meters (656 feet) wide.