PERSON OF THE WEEK: In the five years since New Orleans was wrecked by Hurricane Katrina, the city has struggled to fully regain what was lost. Currently, a unique project is under way to rebuild a section of New Orleans using energy-efficient strategies. The results of this approach could have a remarkable impact not only on the city, but also on the wider areas of urban construction and the financing of residential and multifamily housing.
This week, MortgageOrb talks with Curt Rohner, co-founder and board member of Historic Green, a nonprofit organization that seeks to integrate sustainable design and heritage conservation practices into at-risk communities, about the new green hue coming to New Orleans.
Q: Part of your mission is to make New Orleans' Lower Ninth Ward the nation's first zero-carbon community. Why this location, of all places?
Rohner: The Lower Ninth Ward is a visible reminder of the power of man-made climate change. In 2005, we saw an unprecedented number of powerful hurricanes – both Katrina and Rita showed Americans and the world what can happen when we are not proper stewards of the environment. However, this doesn't absolve the Army Corp of Engineers for their negligence in their design and maintenance of the flood protection systems in and around New Orleans.
This realization among the returning residents of the Holy Cross Neighborhood and the rest of the Lower Ninth Ward motivated them out of two interests: advocacy and survival. The people returning to New Orleans had lived through and been shaken to the core by the realization that their lives would never be the same. A new normal had to be the goal – the old normal would be betrayal of their experiences.Â
They believed their community could revisit the underlying beliefs about the American Dream and then propose an alternative – an alternative that sought to achieve the same goals of happiness and self-sufficiency prescribed to Americans while simultaneously being environmentally virtuous.
Q: Many people assume that green building is very expensive and difficult to finance. Has this been the case with the projects in which you are involved?
Rohner: Are there some up-front cost increases involved in green building? Yes. Are these costs incredibly onerous? No. Can these upfront costs be repaid fairly quickly through the efficiencies garnered through green design? Definitely.
We also need to differentiate between the more noticed 'gizmo' green buildings and those designed to be high-performance. Gizmo green buildings have the solar panels, ground source heat pumps, solar thermal systems, high tech building automation systems and so on. These line items add to overall cost of a building and have been the predominant factor when people say that green building is costly.Â
Most of what it takes to build in a more sustainable manner is not about adding flashy accessories, but about making better decisions. For instance, designing a proper wall system with better-performing windows can greatly decrease the size of the heating and cooling system required. Choosing building materials that have been salvaged through the deconstruction of other buildings turns demolition waste into low-cost and often higher-quality materials for your project. A healthy indoor environment is key in green building.Â
The added cost in green building comes from an immature approach to building in a more sustainable manner.Â Some of these approaches are like saying, 'I need to lose some weight. I think I'll get some liposuction.’ Instead of tackling the root issues that have caused our over consumption, we think that technology will provide a solution for our gluttony. In the end, we need to realize that we'll be better off if we just use less to start with.
Q: What is the status of Historic Green's 2010 projects? And what do you have on tap for 2011?
Rohner: Every March, Historic Green offers a two-week service and learning event in the Lower Ninth. We work with the community to determine priority projects throughout the neighborhood that further the neighborhood's sustainability goals. These include anything from improving the envelope of a house for utility reduction, to installing rain gardens that aid in storm-water mitigation, to maintaining a local playground built and supported by the neighborhood for more than 25 years.Â Â
In 2011, we'll continue to do many similar projects and continue with a few legacy projects, like our renovation work at the Lower Ninth Ward Village Community Center and the Delery Street Playground. We don't specify many projects this far out, because many of them will be determined by the neighborhood leadership this winter in accordance with their goals.
One of our ongoing projects outside of the March event has been the sustainable reconstruction of 5200 Dauphine. Over the last three years, we have worked with the Holy Cross Neighborhood Association, the Lower Ninth Ward Center for Sustainable Engagement and Development, and the Preservation Resource Center of New Orleans to deconstruct, redesign and rebuild a double shotgun camelback house at the corner of Lizardi and Dauphine streets to Leadership in Energy and Environmental Design (LEED) Platinum standards.
This project has been backed by both the National Trust for Historic Preservation and the United States Green Building Council. Eventually, this converted house will be the home of the Holy Cross Neighborhood Association and will act as a showpiece for sustainable preservation.Â
Q: What can the real estate finance industry learn from your experiences in New Orleans?
Rohner: Get what you're paying for. A properly designed and commissioned building will perform in a far more calculable manner from the beginning. The problem here is making sure the building you want and have been promised is the one you get.Â
Commissioning is the practice of testing and calibrating building systems so that they perform as designed. A fact unknown to many building owners and operators is that what you pay for in the contemporary building package does not include a specific guarantee that an installed system – whether it is the lighting or air conditioning – will work as designed. Too many buildings are malfunctioning because they have either never worked properly or their performance has slipped due to a lack of maintenance.Â
Why does this happen? Are builders bad at their jobs, or are they trying to make money by cutting corners? I would argue that, for the most part, builders are doing good honest work. The issue is typically the timeline which gives the contractors installing different equipment very little time to make sure everything works as intended especially when multiple systems have to work in coordination. Independent initial and retro-commissioning of buildings is becoming far more common and, in some cases, legally mandated, as is the case in New York City.Â
Beginning this summer, most buildings over 50,000 square feet will be required to have an energy audit every 10 years and, in many cases, will be required to implement the energy-saving measures dictated in the audit. Commissioning saves the building owner money in decreased utilities, and the preventative maintenance mandated will often extend the life of the equipment examined. This is highly important in the world of commercial building operations, but even more so when we look at the residential building industry.
Homes can easily double in energy cost when they are not properly maintained and commissioned – and, in many cases, energy bills can be as high as a home's monthly mortgage. That kind of situation is not good for anyone.
Q: In the wider U.S. real estate market, what are the advantages of green building and a LEED designation?
Rohner: There are several different ways of looking at 'green' buildings. Some specifically look at energy performance, some look at indoor environmental quality and others are more concerned with material reuse or water management. The LEED Rating System does a good job of balancing these interests.Â
This is not to say that a LEED-certified building is, by definition, sustainable. Sustainability is an approach to all facets of living, including building design. I've heard the LEED system described as how to build the least-polluting kind of building – this is nothing to be looked down upon by any means.Â
We have spent the last 100 years creating a built environment that had no regard for its use of energy and other resources, and changing an industry like this has to be done in steps. LEED has created a great brand and has put some effort into innovating the process of design. As the industry has built up the necessary experience and the skills to create more environmentally friendly buildings, the level of energy savings and environmental quality has also been ratcheted up accordingly.Â