Suffern, NY-based Castle Lanterra Properties (CLP) is aiming to capitalize on the increasing demand for energy efficient and sustainable living spaces
As an investor and owner, CLP is focused on the acquisition of multifamily apartment properties that provide solid risk-adjusted returns. Several years ago, the firm began to focus on energy efficiency as part of its due diligence and acquisition process. The first step was installing new LED lighting packages in communities where energy costs were running high.
Now, the firm is tracking energy consumption for each community and comparing it to other properties in the market. “We’re starting to see a shift towards using third party monitoring services in managing high end properties, and we’re pushing our property managers to adopt similar strategies at all of our properties,” said Austin Alexander, CLP’s Managing Director.
To date the firm has instituted energy saving initiatives at each of its 17 multifamily properties.
In line with its strategy of upgrading underperforming assets, CLP prioritizes improving efficiency in older properties like Midpointe Apartments, a 1970’s vintage, 424-unit complex in Chicago. New roofs, higher quality insulation and LED lighting retrofits have helped lower energy costs while improving the residents’ quality of life.
Water conservation is a key concern that is being addressed across CLP’s portfolio, with upgrades that include low flow faucets, more efficient showerheads, and toilets that use fewer gallons per flush. In addition, all newly-installed appliances are ENERGY STAR certified and smart thermostats such as Nest are being tested at several properties.
The firm is also committed to sourcing recycled or sustainable materials whenever possible for property renovations.
Solar power is an area that CLP has been exploring. One of the firm’s Austin properties, the 455-unit 1825 Apartments, has rooftop solar panels that power most of the common area amenities, offices and clubhouse.
CLP’s 2015 acquisition of Harbor Pointe represents its initial foray into sustainability. The 544-unit apartment community, situated on 7.4 acres along the waterfront in Bayonne, N.J., was built in 2010 and is LEED Silver certified.
CLP’s enhancements to date include unit renovations, a new fleet of bus shuttles for residents, an automated package concierge system, a comprehensive security and video surveillance system, and replacement of all existing door locks with electronic key fobs. Recently CLP has expanded its traditional value-add acquisition strategy to include newly-constructed, best-in-class assets, with an eye for properties that are sustainably built.
“Our last three acquisitions are Green Globes certified through the Green Buildings Initiative,” said Elie Rieder, CLP’s founder and CEO. In addition to reducing operating and maintenance costs, this allows the firm to lower its financing costs with lenders like Fannie Mae, who offer a discounted rate for properties that meet specific sustainability requirements.
“As we continue to pursue new investment opportunities and expand the CLP platform, we expect to capitalize on the increasing demand for energy efficient and sustainable living spaces,” added Rieder.
“It’s clear that a commitment to being environmentally responsible is a strategy that enhances the appeal of assets to both our tenants and investors.”