2024 Spring Issue of Urban Land - 20

developments
savings match. You put in $25,
we'll give you $50, up to a
cap, directed towards a down
payment to help turn renters
into homeowners. " At scale,
Center Creek believes this
model could preserve thousands
of units.
Tatiana Gutierrez, head
of impact and sustainability
at Pretium, another affordable
SFR operator of existing
homes, agrees and cites Harvard
economist Raj Chetty's
work on opportunity insights,
noting that a primary determinant
of generational poverty
is the zip code that a child
grows up in and the social
aspects of that neighborhood:
school quality, neighborhood
safety, and income mix.
" Sustainably renovated rental
homes in single-family neighborhoods
broaden access for
families who may not be financially
ready to own a home in
a community of opportunity,
along with positive rent reporting,
facilitation of credit score
improvement, or the creation
of new credit scores for previously
rent-invisible residents. "
Environmental and
land-use improvements
The single-family land-use
pattern consumes much
more land per unit than does
multifamily. However, some
companies are prioritizing
developments with smaller
footprints.
For Mill Creek Residential, a
developer of multifamily and
attainable rental communities
as well as a new SFR line, that
approach starts with density.
" We wanted to make sure that
we had a diversified product
line that included townhomes,
cottages, and detached singlefamily
homes that would allow
us to provide a high-quality
suburban neighborhood experience
in a variety of different
20
URBAN LAND
settings, " notes Scott Herr,
president, southeast singlefamily
rentals.
Location is vital. " Selecting
sites with adequate and
available utilities, and within
density-positive jurisdictions,
reduces overall development
footprints and impacts on
the environment, " says Lucas
Shires, regional director of land
planning at Mill Creek.
Decarbonization
Many companies are building
or renovating high-performing
homes that follow what Brittany
Ryan, head of sustainability,
Americas at Nuveen, calls
the " build tight and ventilate
right " approach, which emphasizes
envelope efficiency,
including insulation, air sealing,
and efficient windows, followed
by efficient appliances and
HVAC systems. LED lighting
and low-flow water fixtures
and irrigation systems are also
parts of a common approach.
Many companies are integrating
smart home features
to attract tenants and help
them manage energy costs
and emissions. For example,
Pretium now has more than
63,000 homes equipped with
smart thermostats that allow
residents to control temperatures
and create efficient
schedules for heating and
cooling. Smart home tech
enables Pretium's property
management company, Progress
Residential, to offer proactive
guidance and support to
residents when extreme temperatures
are expected.
Companies including Mill
Creek are building all-electric,
with no on-site natural gas
or fuel oil. Electrification can
increase residents' electricity
bills, but those costs can be
offset by efficiency upgrades.
Integrating on-site renewable
energy in SFR is less
SPRING 202 4
common due to cost and
logistics considerations, but it
isn't impossible. Tricon Residential
is building 1,200 homes
in California that will feature
solar panels, and Mill Creek is
exploring applications of solar
photovoltaic roof tiles. Pretium
also piloted solar homes in its
Phoenix market in 2023.
Some companies are even
showcasing net zero SFR communities:
Pearl Homes, which
is developing net zero SFR
homes in Florida; Man Group,
which is using funds from
European investors to build
out 1,000 net zero rentals
across the U.S.; and American
Homes 4 Rent, which stated it
will eventually operate at net
zero.
To address transportation
emissions, Mill Creek is
adding electric vehicle charging
capacity to all garages.
Herr also notes that " Ideally,
our communities are in areas
that encourage our residents
to [spend] more time interacting
directly with their community
.... We'd prefer that our
residents can ride their bike
or walk to the grocery store
and be within 30 minutes of
employment centers. "
Risk assessment
Hazardous climate events in
many hot markets for SFR,
largely in the Sun Belt, are
growing in frequency. Given
the demand for single-family
properties, leading companies
are turning to proven methods
to mitigate risk.
As Mill Creek's vice president
of ESG, Kelly Vickers says, " In
2021, we began supplementing
traditional insurance data
with physical risk data from
Moody's Climate on Demand
tool .... We include these
reports in every investment
committee memo and incorporate
measures to address high
and red-flag risks into design,
where feasible. "
Scott Kelly, with Brookfieldowned
Maymont Homes, highlights
the role of working with
tenants, pre- and post-disaster.
The company tracks progress
of major storms and communicates
with residents on
suggested disaster prep. Afterward,
staff members quickly
check on residents, and assess
and repair any damage.
Climate resilience strategies
have become critical, not only
to protect residents but also
for access to capital. " As we've
transitioned more into this
space, we want to be able to
address the risk to the asset
for our investors, as well, " Kelly
notes.
The SFR Outlook
Progress on ESG in singlefamily
rental, as in much of
commercial real estate, is
accelerating, particularly in the
push for building decarbonization.
Although there are still
environmental and social issues
to address, companies including
Center Creek Capital and
Progress Residential are creating
social impact as a successful
business model, and are
defining how SFR can support
socioeconomic mobility.
Thus, assessing the longterm
ESG prospects requires
examining all aspects of sustainability
and understanding
that single-family rental " done
well " can support building
generational wealth, addressing
systemic barriers to opportunity,
preserving affordable
housing, and increasing access
to greener homes and denser
communities. UL
AUGUST WILLIAMS-EYNON is a
senior associate with the ULI Center for Sustainability
and Economic Performance.
2024 Spring Issue of Urban Land

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