EP 9 — Avanath Capital Management’s David Natt on Finding ROI in Affordable Housing

If you think sustainability means sacrificing profits, think again. In this episode of The Future of CRE Sustainability, David Natt, SVP of Asset Management & Sustainability, Avanath Capital Management is flipping the script on ESG in affordable housing, proving that green initiatives can be a goldmine when done right. From slashing water bills with innovative tech to launching the country's largest dedicated portfolio of solar in affordable housing, Natt shares the secrets behind their meteoric rise in GRESB scores (40s to high 80s in just four years!). 

 

As institutional investors demand higher ESG standards, Natt tells Sean how his asset manager's mindset turned sustainability challenges into opportunities, delivering impressive ROIs while reducing carbon emissions. It's a masterclass in making green work — for the planet and the bottom line.

 

Topics discussed:

 

• How affordable housing companies can boost their GRES scores despite inherent challenges.
• The strategic installation of solar across 18 properties, positioning Avanath as an industry pioneer and achieving Fannie Mae's first-ever approval for solar in affordable housing.
• Specific ROI metrics for sustainability improvements, proving the financial viability of green investments.
• The critical role of European and social impact investors in driving higher ESG standards, including their influence on portfolio management decisions and investment criteria.
• Innovative approaches to reducing utility costs in affordable housing, including the implementation of Aquamizer technology and heat pump conversions for significant cost savings.
• The importance of data collection and analysis in ESG strategy, using mean variance analysis to identify "energy pigs" and optimize portfolio-wide energy consumption.
• Strategies for maintaining affordability while implementing sustainable improvements, including leveraging federal and state rebate programs to offset installation costs.
• The successful integration of solar benefits for residents, providing approximately $50 monthly savings on electricity bills through innovative programs like SOMA.
• Long-term vision for expanding successful California sustainability initiatives across other states, while maintaining focus on both environmental impact and financial returns.