Owners and operators of large multifamily residential buildings have two main priorities when making property decisions.
The first, ensuring that property upgrades improve the space for your current and future tenants. The second, making the most of your investments so that your building management budget can go further. It’s a balancing act to choose the building improvements that check both boxes.
Reduce Energy Costs in Shared Spaces
When you consider building management costs, energy bills are at the top of the list. And in recent years, we’ve witnessed the volatility of energy prices. These factors make your HVAC systems an excellent candidate for an opportunity for greater efficiency.
Of course, you want to keep your residents comfortable in their homes, but what about the shared building spaces?
Shared spaces are challenging in multifamily residential buildings. You want to keep them comfortable for your tenants, but since the spaces are frequently empty, you end up unnecessarily increasing your energy costs. In these multifamily buildings, these spaces are heated and cooled at set times.
We’re talking about spaces like hallways, stairwells, utility rooms, lobbies, and other multi-functional spaces — challenging spaces to narrow down a specific use schedule. All of these pockets of space add up to a significant portion of your building, pulling resources nearly around the clock.
With an occupancy-based HVAC solution, you get precision control of your HVAC system so that it’s only in use when your tenants use the space. The sensors immediately recognize when the space is entered and signal the ventilation to kick on. Additionally, you’re in control of the baseline temperature the spaces are set at for extended periods of inactivity.
Using an occupancy model, you may be able to reduce your energy use by at least 30%. In our deployments, we have found that most spaces are only occupied between 20-50%. The energy savings can give you an almost immediate return on your investment, and beyond that, the system upgrade increases the property’s net value.
Increase Net Asset Value
Upgrading your multi-family property does more than keep your tenants happy. It increases your net asset value and helps your building reduce costs long-term.
With HVAC accounting for at least 40% of energy use in buildings, reducing your upfront energy use will eliminate some of the avoidable financial costs. But what about future cost savings?
While there are no current regulations on carbon emissions for multi-family residential properties, it’s not unreasonable to believe that there may be in the future. Even if there aren’t formal monetary sanctions for buildings that don’t meet emission standards, there will undoubtedly be incentives and possibly, rebates to reduce emissions.
Fortunately, when you turn your HVAC into an occupancy-based system, you take control of your carbon emissions and, in turn, increase your net asset value. When it implemented the technology, improved asset value was one of Greystar’s priorities.
Case in Point: Greystar
Greystar, a leading multifamily property management group, is always looking for innovative ways to improve its properties. In early 2021, Greystar partnered with Nomad Go to implement its occupancy-based HVAC (computer vision plus artificial intelligence sequencing) solution in one of Greystar’s high-rise properties.
Greystar wanted to reduce energy costs and carbon emissions, as well as increase the net value of the property. The building relied on a preset scheduled to run its HVAC system, which left the system running 22 hours a day in the shared space. The cost of heating and cooling the shared spaces in the building was costing Greystar an estimated $52,000 annually.
Shortly after implementation, the HVAC only needed to run around one-third of the time it was originally scheduled based on occupancy. As a result, run time went from 92% all the way down to 34% — an overall reduction of 58%.
What if you could cut the energy costs of your property’s shared spaces by even 50%? If you’re wondering what the ROI on an energy-saving system could be for you, we’ve built an ROI calculator to help you find the answer.
It’s not hard to see why gaining more control over your building’s HVAC system is valuable. But the leading question from building owners is, “What is the ROI?”
At Nomad Go we’ve developed a tool where you enter a few straightforward details and get an ROI estimate. All you need to do is input four data points — the HVAC system you’re using (building automation or stand-alone thermostats), approximate square footage of the space, property type, and your location state (to best capture energy costs). Then, the ROI calculator will do the rest.
Let’s look at an example for a 20,000 square foot multifamily property in California. Based on the data, the property will see a 68% ROI in year one, rising to 121% in year two, 148% in year three, and a 165% ROI in year four. This assumes a savings of 35% of energy costs.
The calculator also provides you with property-specific numbers for product costs, anticipated carbon emissions reductions, and annual energy use and cost reductions.
If you’re interested in improving your current HVAC system, it only takes a minute to answer most of your cost-related questions. And if you have any questions or want more information after checking out the calculator, we welcome you to contact us.
Ultimately, the goal is for your building investments to pay for themselves within a reasonable amount of time-based on the initial capital. The ROI calculator helps you evaluate the return on investment for your specific space based on insights we’ve gathered from your building specifications and location. Feel free to contact us today and we can send you our ROI calculator.