Mortgage lender Fannie Mae is offering lowered interest rates on loans to builders and cooperatives who are developing energy-efficient apartments and multifamily dwellings.
Multifamily structures that have been certified with green credentials such as LEED will receive a lower interest rate on refinance, supplemental or acquisition loans through Fannie Mae’s Multifamily Green Initiative.
The announcement was made by the U.S. Green Building Council (USGBC), which created and administers the LEED green building certification standards. LEED certified buildings typically use substantially less energy and water and have a lower maintenance cost than comparable non-certified structures.
The USGBC reported that Fannie Mae is offering an interest rate reduction of 10 basis points on qualifying loans for green-certified multifamily properties. This would reduce a 4 percent interest multifamily loan to 3.9 percent.
Using the same example, a builder or owner with a $10 million loan would see a savings of $95,000 in interest over a 10-year loan.
The Fannie Mae Multifamily Green Initiative seeks to “improve the energy and water efficiency, to enhance the financial and environmental sustainability, and to extend the useful life of the U.S.’s multifamily housing stock.”
The Green Initiative provides financing options that allow builders of multifamily apartments and cooperatives to invest in energy conservation and water-cost saving measures throughout the structure.
Fannie Mae is the top provider of multifamily financing in the United States, with a holdings portfolio worth more than $200 billion.
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