Multifamily owners can now tap billions in new federal funding to help fund environment-friendly renovations or upgrades to their properties.
The federal Department of Housing and Urban Development has opened its application process for a new fund, the Green and Resilient Retrofit Program, offering as much as $80M in grants or loans, Multifamily Dive reports. Three types of projects are eligible to apply, with a different cap in place for each.
“Implementing the GRRP will provide much-needed funding to reduce water and utility costs and keep the homes of the nation’s low-income individuals and families safe in the face of climate change,” Julia Gordon, HUD’s assistant secretary for housing, said in a statement. “But GRRP also provides a means of addressing issues of housing equity and environmental justice and reducing these properties’ climate impact.”
If a property has only partial affordability, owners may still be granted funding for retrofits that affect all units, rather than just the Section 8 or HUD-assisted ones in a property. Owners cannot, however, use the funding to reimburse resiliency or retrofit work that has already been completed.
Owners of existing multifamily properties that are currently undergoing a recapitalization process specifically including adding sustainability and resiliency features can apply for a maximum sum of $750K, or $40K per unit. There is no minimum requirement for the number of HUD-assisted Section 8 units for applicants in this cohort.
The second eligible group is retrofit projects where the owner is hoping to qualify for green certifications such as LEED or Passive House and have funding from sources other than HUD can apply for $10M, or $60K per unit. At least 50% of units in those projects must be HUD-assisted.
Properties that have high investment needs to implement climate-friendly or resiliency measures, including environmental hazards, can apply for the largest grants of up to $80M or $80K per unit. HUD plans to reserve half of this cohort’s grants for projects that will deliver high-impact energy generation, utility or resiliency projects such as solar or wind power.
HUD’s announcement is the first round of funding intended to help multifamily owners transform their buildings’ carbon footprints and resiliency. Applications for the first round, which will see HUD distribute approximately $2B in loans, will open June 29. A further nine rounds of funding — three per eligibility group — are set to open on a rolling basis next May.
The funding for HUD’s GRRP program was established by the Inflation Reduction Act last August.