Green Renovation Creates Healthier, Energy-Efficient Apartments

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Complete renovation of a deteriorating apartment complex has created a healthier, energy-efficient, and more secure environment for 83 families and seniors in southeast Washington, DC. Renovation of the Galen Terrace Apartments, a three-building complex on two separate parcels in Washington’s Anacostia neighborhood, incorporated energy-efficient technologies and appliances, green building techniques, and a 20-year extension of HUD Section 8 contracts. This ambitious project is aimed at preserving affordable housing in an area facing gentrification.

The Galen Terrace renovation preserved affordable housing in southeast Washington, DC. Photo courtesy of National Housing Trust/Enterprise Preservation Corporation

When Galen Terrace’s owner sought a buyer for the complex in 2005, the residents invoked the District’s Tenant Opportunity to Purchase Act, which requires owners of buildings with more than four units to give tenants the opportunity to purchase property prior to its being placed on the market. That spring, the Galen Terrace Tenant Association began working with the National Housing Trust/Enterprise Preservation Corporation (NHT-E) and Somerset Development to purchase the complex. NHT-E, a joint effort of the National Housing Trust and Enterprise Community Partners, was formed to preserve and renovate affordable multifamily housing that’s deteriorating or at risk of being converted to market-rate units. So far, NHT-E has preserved nearly 4,000 units in 8 states and the District of Columbia. Somerset Development specializes in multifamily and mixed-use commercial development in urban areas, and works to preserve affordable housing. After the sale was finalized in March 2006, construction began the following month and was completed in May 2007.

Financing for the $13.6 million project included $5.66 million in tax-exempt private activity bonds and $4.67 million in Low Income Housing Tax Credits from the DC Housing Finance Agency, a $3.25 million HOME loan from the DC Department of Housing and Community Development, and a $50,000 grant from Enterprise Green Communities.

Galen Terrace provides healthy, energy-efficient homes for 83 families and seniors. Photo courtesy of National Housing Trust/Enterprise Preservation Corporation

NHT-E worked with the local HUD office to extend the Section 8 contracts for 20 years, which will help keep Galen Terrace affordable. Aimee McHale, assistant vice president at the National Housing Trust, notes that the project could not have been completed without the Section 8 contract extension. “The rents we charge under the Section 8 contracts allow us to service the debt on the loan,” said McHale.

HUD’s 21-point Energy Action Plan estimates that cutting energy costs by 5 percent a year could save the Department nearly $2 billion in housing assistance expenditures over 10 years. Galen Terrace certainly demonstrates the potential for energy reduction and efficiency. The renovation included installing meters in all 83 apartments and a high-efficiency heating/air-conditioning system. Before the renovation, the complex paid for all utilities; now residents will receive a utility allowance and pay for their own utilities. Energy Star kitchen appliances, double-paned windows with low-E glass (which reduces heat loss and gain), low-flow plumbing fixtures, and a new roof with a reflective surface will all contribute to utility cost reductions at Galen Terrace.

This deteriorating building was reduced to walls and studs during renovation. Photo courtesy of National Housing Trust/Enterprise Preservation Corporation

An energy audit of the existing complex identified the need to seal the building envelopes. Because the units contained both lead-based paint and asbestos, residents were relocated during remediation and renovation. The residents moved to apartments within three miles of the complex and paid the same rent. Somerset Development picked up the differential costs for rent, as well as utility and phone deposits.

The full renovation reduced the three buildings to walls and studs. The developer installed new flooring and carpeting, lighting, bathroom fixtures, kitchen cabinets and appliances, and windows, along with six laundry rooms, each with four washers and four dryers. Features added to improve security include controlled-access doors, security guards, surveillance cameras, lights, and fencing.

The renovation also incorporated environmentally friendly elements, including:

• Paints, primers, and sealants low in volatile organic compound emissions;

• Formaldehyde-free wood cabinets;

• Pipes wrapped to prevent leakage (which could cause mold); and

• Rainwater catchment barrels to provide water for landscaping.

Affordable housing preservation is considered green because rehabilitation produces less construction waste, requires fewer raw materials, and uses less energy than demolition and construction. McHale noted that the benefits of incorporating green technology into the renovation include a healthier living environment for residents, lower utility bills, and increased sustainability.

During the renovation, NHT-E and Somerset Development met with residents and the Edgewood Management Company to discuss enforcement of leases — something that had not happened in the past at Galen Terrace. “As a result, some former residents did not move back into the renovated complex,” said McHale. She noted that fewer problems have been recorded since the complex reopened in June 2007.

As part of the renovation, Galen Terrace now has an onsite property manager, a full-time resident services coordinator, and a new community center/property management office. Last summer, the complex offered a camp for resident youth. This fall, it began an afterschool program using the community center’s computer lab and 10 networked computers.

The Galen Terrace Tenant Association holds a 15-percent share in the general partnership, NHT-E holds 43 percent, and Somerset Development holds 42 percent. The association received a portion of the development fee to be used as an endowment to pay for resident services. A percentage of the partnership administrative fees also supports resident services and activities.

Before the Galen Terrace renovation, few signs of reinvestment were visible in the Anacostia neighborhood. “Galen Terrace has been a catalyst for other development in the community,” said McHale, referring to a former apartment building across the street from Galen Terrace rehabilitated by a longtime neighborhood resident and now for sale as condominiums. In addition, several market-rate condominiums and duplexes are under construction within a one-block radius.

For more information about the National Housing Trust, visit their website at www.nhtinc.org/index.asp. To find out more about the HUD Energy Action Plan, see www.hud.gov/energy/energyactionplan.pdf and to see more projects by Somerset Development, visit their website at www.somersetdev.com.