Tenants
Safe Way
Properties with the SaferBuilding certification are seeing healthy rents.
By Michelle Miller |
When it comes to construction industry standards, “green” does
not always equal clean. Developers and investors potentially can increase
profits by selecting building materials that are safer both in terms of
environmental and tenant concerns. Similar to how organic food commands a
higher price, apartments maintained as environmentally friendly command higher rents
from tenants who choose to live a healthier lifestyle. SaferBuilding.com , an online
resource , has launched a program to help establish safety, educational, and
certification standards for building/remodeling projects nationwide.
SaferBuilding.com tests buildings and remodeling projects for
toxicity and has a certification program in order to make properties safer
overall and increase their value.
Photo caption: The amenities and building materials in this apartment earned it the SaferBuilding certification.
Photo credit: SaferBuilding.com
Meeting the Standards
Properties that achieve SaferBuilding.com certification have
increased rental rates ranging from 7 percent to 10 percent. For example, actual
rents in a multifamily property have increased from $930 per month to $1,330
per month after remodeling according to SaferBuilding’s recommendations and becoming
SaferBuilding certified. Rents were not raised on existing tenants but offered
to new tenants after the remodeling was complete.
Existing tenants had new apartment rules that forbid
use of chemicals, which leave a toxic residue on the property, such as
pesticides. Interestingly, no existing tenants moved out or complained as a
result of the restrictions.
About 38 percent of the rental increases are due to the
property’s renovation and 62 percent are attributed to SaferBuilding conditions
and certification. This number was gathered by looking at rents of other
properties with similar features.
There are five categories within SaferBuilding’s certification
program, including neighborhood, pesticides, walls, floors, and maintenance. To
be certified, properties must qualify in all five categories. Each category has
roughly 20 criteria questions. The online process is similar to property
disclosure questions required for single-family houses in many states.
For example, the certification asks about what products have
been used for termite control. Many termite control products leave a toxic
residue after application, while some do not. The certification asks about
flooring materials. Both new and old carpeting can exacerbate asthma and other
health issues, while hardwood flooring generally does not. Carpeting is a
favorite in multifamily buildings due to the price, but using hardwood flooring
material and getting the apartment SaferBuilding certified can more than make
up for the cost due to increased property value.
Developers can access the precise criteria by purchasing environmental
disclosure and site packages, which include how-to guides. The packages are designed
for commercial real estate experts and highlight the differences between
traditional construction methods and SaferBuilding’s recommendations.
Multifamily Criteria
In multifamily properties, both common areas and individual units
must meet certain criteria to qualify for certification. Builders can consult
directly with SaferBuilding for assistance in selecting approved construction materials
and methods.
In addition, developers can review neighborhood demographics
to determine if SaferBuilding features may be a high priority for potential tenants
within the market. In some neighborhoods, apartments with high-end finishes,
such as granite countertops and wood floors, will rent at a premium and the
high-end finishes are worth the extra cost. Similarly, in some neighborhoods,
SaferBuilding materials and methods will rent at a premium and will be worth
the extra cost. Properties will need the SaferBuilding certification to inform
prospective renters since -- unlike granite countertops and hardwood floors --
they may not be easily detected.
SaferBuilding certification costs $80 per property, which includes
marketing materials building developers and property managers can provide to prospective
buyers and renters. For more information about SaferBuilding, visit www.saferbuilding.com.