Sule Aygoren Carranza is managing editor of Real Estate Forum and editor of Multi Housing forum, from which this article is excerpted.

New York City—The green building wave has infiltrated every corner of the industry, and it's particularly prevalent in the residential sector. In multifamily specifically, developers are applying environmentally friendly elements to projects across the nation and to the entire spectrum of housing. In New York State, two projects exemplify how developers can build green at both the affordable and the high end.

In Ithaca, NY, the Domain Cos. and the Arker Cos. of Woodmere, NY have teamed up with Ithaca Neighborhood Housing Services to develop an affordable housing community with sustainable design elements to serve the working families of the area. The first phase of Overlook at West Hill that encompasses 64 units and a 5,900-sf clubhouse debuted this past spring and is 100% leased. The first building in the second phase will be ready for occupancy this month, and when fully complete by next June, the $20-million community will offer 128 rental units and 15 for-sale units of energy-efficient housing.

Half of the community's units are available to residents earning up to 60% of area median income, 35% will go toward those at 50% of AMI, and 15% of the residences will be occupied by households earning no more than 30% of AMI. Some 15% of the units will likely house formerly homeless families. The project also offers a playground and recreational and open space.

The project was financed through a public-private package that included funding from the New York State Division of Housing and Community Renewal (NYSDHCR); the New York State Energy Research and Development Authority (NYSERDA); a $2-million loan from Freddie Mac; a $390,000 grant from the federal NeighborWorks America program; and a $2-million construction loan from Bank of America. The NYSDHCR provided 9% tax credits that was syndicated to an affiliate of Related Capital Co. for $6.7 million in equity.

According to Chris N. Papamichael, principal at the Queens, NY-based Domain Cos., Overlook at West Hill was a collaborative effort between Domain and Arker, which work together on several projects; INHS, which acted as a local partner, and NYSERDA. "We at Domain develop both market-rate and affordable projects, and we typically try and keep the same standards within both," he says. "We came up with the idea for Overlook after learning about NYSERDA's program, which offered incentives to help make this project energy efficient and to make the upgrades feasible."

The project is benefiting from NYSERDA's Energy Star Multifamily Pilot Program, which encourages energy-efficient apartment design and construction. Multifamily buildings constructed under the program use at least 20% less energy than those that aren't, thanks to such energy-saving features as increased insulation, high-performance windows and doors, high-efficiency heating and cooling systems, energy-saving appliances and lighting, and innovative technologies like advanced meters, renewable energy and combined heat and power systems. Further, NYSERDA works with the project's design team to ensure that these Energy Star guidelines are fulfilled, and each building qualified for an incentive, based on the community's projected energy savings--in this case, up to $290,000.

Among the features at Overlook at West Hill, which was designed by Ithaca, NY-based Holt Architects PC and constructed by the Charles A. Gaetano Construction Corp. of Utica, NY, are highly efficient furnaces, boiler, appliances and lighting, low-energy windows and a well-insulated envelope. "All of these come together to make the building more energy efficient," says Papamichael.

While these elements come at a slight premium, says the executive, they result in a 25% reduction in annual operating costs compared with typical new construction of the same type. In addition, the energy savings will lower utility bills for the project's residents for years going forward.

Meanwhile, in Manhattan's Battery Park City neighborhood, the Sheldrake Organization and is working on Riverhouse, a $400-million green luxury community that the developer claims far surpasses all other such projects in the city. Designed by a collaboration of Polshek Partnership Architects, Ismael Leyva Architects and David Rockwell, the waterfront development offers 264 one-, two-, three- and four-bedroom condominiums in simplex, duplex and penthouse layouts on 31 stories.

Going green in this case, relates Glen Ravn, director of design and construction for locally based Sheldrake, was a prerequisite for building in Battery Park City. The developer had done environmentally sustainable projects before, but this is the first one that's LEED-certified. Yet, while local officials required a LEED certification of Silver, Sheldrake voluntarily brought its development up to Gold Standards.

And because BPC officials not only adhere to LEED standards but also to their own, Ravn says Riverhouse is unlike any other green project in the city. "Those environmental guidelines are not entirely redundant," he says. "Some BPC requirements, for instance, such as having fresh, filtered air flow to apartments, are not required by LEED."

In fact, Ravn notes that the project's LEED consultants are working on verifying whether the 625,000-sf Riverhouse is the largest LEED-certified high-rise residential condominium in the country.

Among the elements in the community are the use of Energy Star appliances, Polshek's triple-glass curtain wall and photovoltaic solar panels that track the position of the sun and draw themselves to it in order to optimize energy production. The development also features green roofs and progressive filtration and recycling technologies, and offers environmentally responsible materials. The developers have invested in excess of $35 million into green initiatives.

Like Papamichael, Ravn agrees there is premium to build green of about 5% to 10%. In Riverhouse's case, that premium is nearly 15%, but the energy efficiencies will result in an overall operational costs savings of about 25% annually.

The community will be ready for occupancy by the end of next year, but Ravn relates that it's already seeing a great amount of traffic. "We're getting a lot of interest, and I think because we're green, our sales will ultimately be better than non-green residential projects nearby," he says. People will pay a premium for green technologies in the units, which start at some $800,000 and in the case of the penthouses, can be as high as $6 million.

The community also offers a double-height lobby with tree house, a childrens' lighthouse, billiard room, public library, bakery, gym and yoga room and glass-tiled swimming pool.

Expect even more of these projects going forward, say the developers, who maintain that "going green" is not just a passing trend, but a way of life for the industry today. Papamichael relates that Domain is planning several green affordable and market-rate projects, and Sheldrake itself has a mission to expand its eco-brand, not only in New York but also in other major cities. In fact, Sheldrake founder Christopher Daly is seeking to spread his message of developing environmentally friendly, sustainable projects beyond just the real estate community to lawmakers.

BPC is one example of a municipality that has imposed the requirement, and already in Washington, DC, officials recently passed an ordinance requiring that all new developments there incorporate green principals.

"Green, which basically means healthy living, is becoming a way of life. People are a lot more aware of their environments and, at least in Manhattan, a lot of people that are buying condos are looking at the future values of their units, and the future is going entirely to green—whether it's mandated or voluntary," says Ravn. "There are a lot of nice features to this, but the benefit is to the end user. The trend is going green and green materials are also becoming more readily available. And as it becomes more prevalent, as a developer, we want to be ahead of the curve so that when the industry goes green, we'll be at an advantage."

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