Electrification In Multi-Family Can Generate Profits
Multi-Family Properties: Electrification Series Part 3
4 MIN. READ
In the first two parts of this series, we covered multi-family property electrification and EV charging trends, but one question remains – what exactly can managers expect in terms of electrification revenue? This final part will not only help you pick out upgrades and appliances, but it will also delve into additional revenue sources that electrification can bring to your properties.
General cost savings from electrification
Debates have raged over the most efficient way to heat, cool, and operate buildings. But recent studies have confirmed that properties powered by electrification are more cost-efficient in the long run. They also have less of a negative impact on the environment.
These two factors provide clear evidence to support the big push for electrification in the multi-family sector. Let us look at some potential electrification revenue sources.
All-electric buildings are more efficient. All-electric heat pumps are up to 40% less expensive to operate. They can be used to cool and heat a space and do not consume fossil fuels to run. Under normal conditions, a heat pump can transfer 300% more energy than it consumes.
Remember building and renovation cost considerations. The cost to construct all-electric homes is cheaper than conventional builds. For example, in California, builders can expect to save around $3,300 a unit because they can avoid costs associated with traditional build-outs like lateral piping, appliances and venting systems.
Electrification helps avoid expensive and dangerous gas-related incidents. Natural gas is flammable, and when pressurized or fed through piping, it has the potential to explode or leak out when disturbed or damaged. The National Fire Protection Association reports that natural gas sources cause more than half of residential fires.
Battery storage helps you bounce back from outages or natural disasters. Power outages are inevitable. Restoration times can be long and painful. Having a battery backup and solar array set up can help multi-family owners bounce back quickly after an outage. Power stored in battery banks can help power essential items during an outage.
These are all major benefits of electrification in the property sector. Efficiency, cost savings, safety, and peace of mind are huge factors that swing in favor of full electrification.
Electrification attracts tenants and helps increase revenue
Sometimes overlooked is the ability to actively generate revenue from electrification. Electrification services are becoming more of a necessity than a luxury. Building owners are keying in on several aspects to help create electrification revenue.
Tenants are increasingly environmentally conscious. Millennials and Gen Z generations are leaders in the march for the environment. They expect others, especially the places they live and work, to be like-minded. These groups will seek out those properties that that align with their environmental ideals and standards.
Solar and other renewable energy applications are viable. Solar systems work as their own revenue sources because they can be set up to send excess energy back to the grid - which creates a credit. This gives multi-family owners the opportunity to spend less on energy while making money.
Certain tenants will happily pay premiums for commitments to clean energy. Businesses are rewarded for their commitment to clean energy. If your property promotes itself as being invested in the green economy and does a good job of showing and explaining how you are being environmentally responsible, some tenants will pay premiums for such services and commitments.
If you want to attract tenants who are willing to pay a premium for electrification services, committing to electrification and providing clean amenities is a sure way to do it.
EV charging is a potential electrification revenue source
Electrification revenue can help pad profits when applied appropriately, and EV charging is a key candidate to become one of your main sources.
Options -free versus paid versus built into the monthly rent. Some properties offer EV charging as a free service or they take a hybrid approach. For example, they may give the first two hours free and then start charging after that time. Some also incorporate the fees into the rent. Giving your residents options is always a good thing so you can be flexible and accommodate more people's needs.
Preferred employers. Properties often give discounts to preferred employers. However, if a lot of employees of a certain business live at your property, consider having their employer shoulder certain installation/charging costs.
EV charging is the gateway. It is easy to start the electrification process with EV charging. Many multi-family owners want to transition to electrification, and EV charging is the jumping-off point.
But with so much information out there, it can be confusing how and where to start. Raiven has the information and resources to help multi-family owners.
Raiven can help
Raiven has a robust e-marketplace that can help electrify your properties by finding the highest value appliances and the best electrical contractors for the jobs involved. We can also link you with Qmerit, a leader in electrification and EV charging station installations.
Reach out today for more information on how you can save money by going electric.