Unique loan from Toronto Atmospheric Fund yields impressive financial and environmental results
Toronto, ON – Nearly two years ahead of schedule, the condominium corporation for the Nuvo II building in Etobicoke recently paid off its $500,000 Green Condo Loan, an innovative financial arrangement developed through a unique collaboration between Toronto Atmospheric Fund (TAF) and Tridel, one of Canada’s leading high rise residential developers, to advance improvements in energy efficiency.
Thanks to the energy efficient measures installed during construction and paid for through the Green Condo Loan, the 29-story condominium achieved a 41% reduction in energy use compared to its conventionally built sister building and saves $125,000 a year in energy costs – 30% more than the annual Green Condo Loan payments. The tower became one of Toronto’s first LEED Silver condominiums and the drop in its energy consumption translates to a 550-tonne reduction in yearly greenhouse gas emissions.
The first Green Condo Loan was entered into between Tridel and TAF in 2008 when the two condominium towers were being built. One of the towers was constructed and financed in a conventional manner while the other incorporated energy efficient improvements. By taking on the loan, Tridel was able to pay for the incremental costs of the improvements – such as better insulation and high efficiency boilers – over and above building code requirements at the time without raising the price of its residential units.
“After helping to create the financing model with TAF’s team, Tridel entered into the loan agreement on behalf of the future condominium corporation so that we could build a high performance building and introduce a new standard of efficient construction at competitive prices in a crowded market,” said Jamie James, a partner with GreenSoil Investments, who was Tridel’s sustainability advisor at the time. “The results affirm the value of investing in efficiency. Now that the loan is paid off, all of the savings accrue to the homeowners. A significant monthly charge has just come off the books, which should result in higher condo valuations.”
The Green Condo Loan bridges the divide between builders focused on cost control and condominium corporations who pay the utility bills. It provides developers with financing to build energy efficient structures that exceed the minimum energy code requirements by at least 25%. However, payments on the loan are actually made by the condominium corporation, which benefits from the lower utility costs.
“Our Green Condo Loan shows that green buildings are profitable,” said Tim Stoate, TAF’s Vice President Impact Investing. “The Tridel building proves the viability and benefits of this financing program. Owners meet their bottom line, people get to live in energy efficient buildings, and everyone benefits from a cleaner environment.”
TAF has committed to advancing five other Green Condo Loans, and Tridel has used the Green Condo Loan model in 16 additional buildings.
Nearly half of the City of Toronto’s greenhouse gas emissions are generated by buildings. Finding ways to reduce energy consumption in this sector is the single most effective means of reducing emissions that cause climate change.
– 30 –