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LEED Certification for Multifamily Properties

Sustainable building practices lead to lower operating costs, better tenant housing quality, and less environmental impact.  Leadership in Energy and Environment Design (LEED) is the most widely used third-party certification for green buildings.  Incentives for getting certified include point reduction in the interest rate for refinance, acquisition or supplemental mortgage loans from Fannie Mae multifamily lenders.  As the financial incentives extend beyond building green to major renovation projects and operations, there is increased benefit to having an existing multifamily property become LEED-certified.

Project Categories

Applicable to a wide range of projects during all phases of development, LEED certification guides cover best practices and steps for meeting and documenting requirements for the following broad categories.

  • Building Design and Construction
  • Interior Design and Construction
  • Building Operations and Maintenance
  • Neighborhood Development
  • Homes (includes low-rise multifamily buildings with one to three stories and mid-rise multi-family buildings with four to six stories.)

Rating Systems

Within these categories, there are multiple rating systems that accommodate the needs of various market sectors. Prior to pursuing certification, project teams must determine which of the 21 rating systems is the most relevant.  For example, a high-rise multifamily construction project of 9 stories or more falls under the major category of Building Design and Construction.  The rating system that applies is LEED BD+C: New Construction and Major Renovation, which covers multifamily buildings of this size as well as other construction and renovation projects that do not serve K-12 educational, retail, hospitality, or health care uses.

Minimum Program Requirements

Specific characteristics make a project eligible to pursue LEED certification.  These foundational elements are Minimum Program Requirements (MPRs) covering the types of buildings, spaces, and neighborhoods LEED will evaluate.  MPRs include a minimum square footage that varies by project category.  Building Design and Construction projects must include a minimum of 1,000 square feet of gross floor area, for example.  All LEED projects also must also be located and operated on a permanent location.

Certification Points

During the certification process, projects earn points within their chosen rating system.  Points determine the ultimate designation of a Certified (40-49), Silver (50-59), Gold (60-79), or Platinum (80+) rating level.  The point system provides the flexibility to design an individualized path to certification provided that certain prerequisites are met.  As LEED is focused on creating healthier spaces with less environmental impact, points are used as rewards for excelling in specific focus areas.  These include areas such as energy and resource efficiency as well as innovative sustainable design strategies.  Projects are encouraged to incorporate new technologies, apply scientific research, and develop new building features.  Achievement of measurable environmental performance that is not already addressed in the LEED rating system advances green building principles.

Whether multifamily projects are financed through Fannie Mae, Freddie Mac, or FHA commercial real estate loans, LEED guidelines can help to lower operating costs and lessen environmental impact.  LEED certification acknowledges multifamily property owners who construct, renovate, and operate in accordance with guidelines for sustainability.  With the goal of increasing the number of resource-efficient, healthy environments, LEED also encourages project teams to develop best practice guides and case studies that will benefit the building industry.  The financial incentives for owners of LEED-certified properties underscore the commitment of the multifamily finance industry to promoting green building practices.

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