Multifamily Buildings

Multi-family housing accounts for about 18 percent of the nation’s housing stock. Multifamily buildings present a tremendous opportunity for energy savings. Comprehensive, cost-effective upgrades in multifamily buildings can improve efficiency by 15-30%, representing an annual sector-wide savings of almost $3.4 billion (ACEEE). Increasing energy efficiency in multifamily housing requires development and refinement of current policies, incentives and financing structures that are offered on the federal, state and local level. For existing multifamily housing, building retrofits and upgrades can significantly benefit multiple areas of a building, such as insulation upgrades that reduce leakage, HVAC upgrades, patching leaky ducts to improve indoor air quality which positively impacts residents’ health and well-being, and many others.

Buildings of these types include:

  • Residential R Group (less than or equal to 3 floors)
  • Apartments
  • Condos
  • Townhomes
  • Campus Dormitories


Energy Efficient Practices & Solutions for Multifamily Buildings

Multifamily Retrofit Tools and Resources

The Department of Energy (DOE) has a variety of specific multifamily tools and resources that help reduce lender, building owner and tenant uncertainty about energy upgrade, or existing buildings, results. DOE has the ability to directly retrofit many of the nation’s multifamily properties through its deployment programs and the tools below (DOE):

HVAC Systems

According to ENERGY STAR, ductless mini-split heating and cooling pumps are often used in:

  • Homes with costly electric heat (e.g., baseboard; furnace; wall heaters; electric radiant) that will also benefit from cooling.
  • Older homes with no ductwork (e.g., radiators or baseboard heat) that never had central air conditioning before
  • Homes with expensive central heating systems due to high fuel costs or low system efficiency
  • Additions or outbuildings (e.g., shed, barn, garage) where extending ductwork or cooling/heating capacity is not feasible
  • Rooms that are not regularly occupied (indoor unit can be turned off to save money)
  • Spaces adjacent to unconditioned spaces where ductwork would be exposed to harsher temperatures (e.g., a guest room above a garage)
  • New construction of homes in areas with high fuel costs
  • Older commercial buildings with no existing ductwork for air conditioning or expansions


Insulation is an important component of almost all new construction and many energy-efficiency improvements, and given the quantity of insulation used, it is easy to see how materials decisions can cumulatively affect the amount of toxic material brought into building spaces, especially projects that have multifamily housing:

  • Expanded cork board is top ranked
  • Prefer fiber glass and cellulose insulation
  • Avoid products with formaldehyde-based binders
  • If board insulation is required, prefer rigid mineral wool insulation
  • Avoid foam insulation, whether board or spray-applied
  • Use mechanical installation methods

Air Sealing

Air sealing is critically important in sealing the barrier of your building and when considering the envelope performance in improving energy efficiency. Many air sealants are applied wet and emit chemicals of concern as they dry or cure. Consequently, solid forms of sealants are usually better options:

  • Prefer caulk-type sealants over spray foam sealants
  • Prefer foam sealing products that are not reacted on site
  • Avoid phthalate plasticizers
  • Prefer acrylic-based sealants with very low levels of VOCs
  • Prefer foil-backed butyl tape for HVAC sealing
  • Avoid products that are marketed as being antimicrobial

Policies and Program Resources

Weatherization and Intergovernmental Program Office
Weatherization and Intergovernmental Programs (WIP) is part of the Office of Energy Efficiency and Renewable Energy (EERE) and supports DOE’s mission to create greater energy affordability, security, and resiliency. WIP’s mission is to enable strategic investments in energy efficiency and renewable energy technologies through the use of innovative practices across the United States in partnership with a wide range of stakeholders, including state and local organizations and community-based non-profits.


Duke Energy Multifamily Energy Efficiency Program
Duke Energy will provide and install energy-efficient lighting and water measures in each unit at your property to assist with scaling energy consumption and slicing utility costs for your tenants.


Duke Energy Progress Residential New Construction Program (Formerly known as the HERO Program)
With rebates starting at $250 per dwelling unit Duke Energy Progress has made it easier than ever to build energy efficient homes and apartments and offers incentives to do so – take advantage of these incentives for your next project in North Carolina or South Carolina.


HUD Mortgage Insurance Premium
HUD offers a mortgage insurance premium (MIP) rate reduction will for Federal Housing Administration (FHA) insured multifamily loans secured by buildings that meet the requirements and attain a green certification. The rate reductions can apply for multifamily new construction, renovation, refinance, purchase, or elderly housing.  Annual MIP rates will be reduced to 25 basis points from the current rates, generally between 45 and 70 basis points, for all multifamily FHA-insured loan types that meet alll specified conditions.


North Carolina Case Study

Sojourn Glenwood Place – Raleigh, NC

Source: Southern Energy Management (SEM)

Sojourn Glenwood Place is a 296 unit multifamily community in the heart of Raleigh, North Carolina. Beyond all of the modern finishes and convenient amenities, Sojourn Glenwood Place offers comfort and efficiency to residents as well as savings and a more sustainable lifestyle as a Bronze Level Certified NGBS community. This project received efficiency incentives from Duke Energy Progress for the installation of high efficiency HVAC units which SEM led the project team through this process and Due to increased energy efficiency, the project was able to meet HERO Code.

Source: Fannie Mae

A recent Fannie Mae report on its own green financing program for multifamily units offers these key takeaways:

  • Owners who made their properties more efficient are projected to recoup their investment within approximately six years on average, while tenants at these properties are projected to see annual utility expenses cut by 10%, or $145, on average;
  • Properties are projected to reduce water use by 5.9 billion gallons, equivalent to the amount of water consumed annually by nearly 54,000 American families, and greenhouse gas emissions by 287,000 metric tons annually, equivalent to nearly 61,000 passenger vehicles driven for one year; and
  • Newly constructed or retrofitted green multifamily buildings are estimated to have contributed $7.2 billion in workers’ income and $14.6 billion to gross domestic product and supported 170,000 jobs.


Additional Resources