SPECIAL FOCUS
READERS’ CHOICE AWARDS
BEST OVERALL PROJECT:
Readers Laud Solar-Powered
Tax Credit Development
BY ANDRE SHASHATY
AFFORDABLE HOUSING FINANCE • NOVEMBER 2007
POWAY, CALIF.—At a time when “going green”
has become a catchphrase
and marketing slogan, a
small 56-unit project here
stands out as a promising
model for a comprehensive approach to
energy conservation and environmental
responsibility.
AFFORDABLE HOUSING FINANCE readers
voted Solara as one of two winners of
the most outstanding project award in
the magazine’s Readers’ Choice Awards
for 2007.
The project was completed earlier
this year in this San Diego County community
by Community HousingWorks.
As the name suggests, this project
meets its electrical power needs from a
series of photovoltaic panels on its roofs.
Community HousingWorks incorporated
many other “green” features to make the
project energy efficient and environmentally
friendly, said Anne B. Wilson, director
of housing and real estate development.
A wide array of financing sources
and strong support from the city were
crucial to getting the project approved
and covering its high costs, including $1.1
million in hard costs for the photovoltaic
system alone. The total project cost was
$16.3 million.
“The city of Poway is proud to have
worked with Community HousingWorks
in the development of Solara—a model of
green, Smart Growth both in the state
and the nation,” said Poway Mayor
Mickey Cafagna.
The city and the developer “pioneered
the way for more affordable housing
complexes to successfully go green,’”
he said. “What we did at Solara will probably
be normal practice for
multifamily builders in the
next five years as we all
work to lower emissions
and counter climate
change.”
The project received
federal tax credits of $11.4
million over 10 years. The
family project has mostly
two- and three-bedroom
units, with only eight onebedrooms.
They range in
size from 659 square feet
to 1,023 square feet. All
units are affordable, with
23 percent affordable to
households earning up to
60 percent of the area
median income (AMI),
and the balance serving
people with incomes topping
out as low as 20 percent
of AMI.
The developer covered
the cost of the solar energy
system by tapping several state and federal financial incentives
that are generally available but not
widely known to housing developers.
Equity was syndicated by the
National Equity Fund (NEF). The equity
proceeds from the federal housing tax
credits totaled $11.3 million. On top of
that, NEF raised an additional $208,000
from the sale of the federal investment
tax credits for the use of solar power. The
credit is for 30 percent of the amount
spent on eligible solar systems.
Permanent mortgage financing
came from Union Bank of California,
which agreed to loan $13 million for 40
years to help defray the portion of the
cost of the solar installation not covered
by other sources.
Solara also received a rebate of
$409,000 from the California Energy
Commission on the cost of the solar
energy panels.
The building is the first in
California and possibly in the entire
country to use solar power for all residential
and common areas. The building
is still linked to the public utility power
grid, so that it can feed in electricity during
peak solar generating hours and
draw power at night. The project’s first
monthly electric bills have been negative.
Located just northeast of San
Diego, the development’s biggest energy
challenge is air conditioning. Space
heating is done with a tankless hot water
system that also generates hot water.
The system is gas-powered.
The project’s energy efficiency helps
tenants primarily by protecting them
from the increases in utility costs, especially
for electricity, that California
developers are expecting.
Tenants pay no utility costs, leaving
the risk of excessive consumption and
price increases with the project sponsor.
To make sure tenants don’t lose
track of their usage in the absence of
monthly bills, the sponsor insists that
they take training in energy conservation
and includes “green” provisions in
leases.
“I’m very happy living here,” said
Solara resident Alfonso Perez.
“Everything works very well. And, electricity
from the sun! It’s very convenient
to walk to the market or errands with
my grandchildren—and not have to get
into the car.”
SolaraDeveloper: Community HousingWorks
Architect: Rodriguez Associates Architects & Planners
Major Funders:
National Equity Fund
Union Bank of California
City of Poway Redevelopment Agency
County of San Diego
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