Business Case

Rising utility rates create financial risk for owners and reduce affordability for tenants of low-income multifamily projects. How do you reduce the operation costs of a repurposed elementary school converted to a senior living facility?

Background

Washington Elementary School was built in 1938 during the second New Deal under President Franklin Roosevelt. Beginning in 2018, the school was repurposed as Washington Historic Residence Apartments and renovated as 26 units designed for independent senior living.  The school’s gymnasium was converted into a community room. A portion of the project received funding in part through the Low Income Housing Tax Credit (LIHTC) program, in which a certain number of units are set aside for lower-income households. Powering the common areas of the facility (community room, hallways, outdoor living area and parking lot) represented a significant on-going operational cost item for the management company.   

Solution

An analysis of the projected energy usage for the facility’s common area indicated a 35 KW solar array would offset a significant portion of the energy requirements. Tax equity financing comprised of the Solar Investment Tax Credit, Modified Accelerated Cost Recovery System (MACRS) 100% Bonus Depreciation, as well as federal and state historic tax credits were utilized to fund the project. The project’s 25-year savings of $221,700 resulted in an Internal Rate of Return (IRR) 21.4%. The payback period was 2.4 years. 

Since the building was designated a historic building, the solar array could not be visible from the street level. SolarEdge equipment and module-level monitoring were installed, utilizing Unirac RM-5 racking.