When REACH Community Development completes its newest workforce housing community in a few months, it will have also built the largest multifamily Passive House in North America.
The 57-unit Orchards at Orenco will be a landmark development for the nonprofit organization and the Passive House movement.
In 2013, REACH purchased a 6-acre site next to the MAX light-right station at Orenco Station in Hillsboro, Ore., near Portland. “Our vision was to build three multifamily buildings on the land,” says Laura Recko, director of fundraising and public relations. “We always had the vision that at least one of the buildings would be a Passive House project.”
The idea came from Dee Walsh, who led the organization for about 24 years before joining the Housing Partnership Network in 2012. She saw Passive Houses in Europe and brought the idea to REACH.
“We know that transportation and utility costs are some of the largest expenses people have in their monthly budgets,” Recko says. “We wanted to drive those costs down as much as possible for residents.”
Overall, there are about 130 certified projects of all types that have been reviewed by the Passive House Institute U.S. (PHIUS) and another 100-plus more in the pipeline, says Michael Knezovich, the organization’s director of communications.
The term Passive House, or Passivhaus in German, is a bit of misnomer because it suggests it’s only good for single-family homes when the approach can be applied to any building, according to Knezovich.
Passive building is made up of a set of design principles to attain a high level of energy efficiency. These principles include having a building envelope that is extremely airtight, employing high-performance windows and doors, and managing solar gain to exploit the sun’s energy for heating purposes and minimizing it in cooling seasons.
Multifamily buildings make up the movement’s fastest-growing sector, and a big part of that is affordable housing like Orchards at Orenco. That’s because “the energy savings and resilience of the buildings are very well suited to affordable implementation,” says Knezovich.
At the end of February, longtime affordable housing developer ACTION-Housing celebrated the opening of Uptown Lofts on Fifth in Pittsburgh. The project features two buildings, one with 23 units for low-income families and another with 24 units for young adults aging out of the foster-care system.
The 24-unit building is built to Passive House standards while the other is built to regular energy-efficiency criteria. This will allow for a good comparison study to evaluate the economics of both methods.
The funding for the project included $11 million in low-income housing tax credit (LIHTC) equity from syndicator National Equity Fund and investor BNY Mellon, which also provided $8 million in construction financing.
More projects may be in store in Pennsylvania. In the state’s highly competitive LIHTC program, developers can earn points for projects that will meet Passive House certification.
The Pennsylvania Housing Finance Agency (PHFA) has long had energy points in its qualified allocation plan (QAP), but the new 2015 QAP specifically addresses Passive House features, says Brian Hudson, executive director and CEO. Developers may be awarded up to 10 points for developments that meet Passive House certification for energy efficiency. A total 130 points are available in the competition.
The agency was motivated by the tremendous energy savings that can be achieved under the Passive House approach, Hudson says.
PHFA plans to make its awards around May and will know more then about the developments that have applied for housing credits.
Construction also continues across the country in Oregon.
The roof at Orchards at Orenco will have about four times the amount of insulation required by code. Windows will also have a European-style tilt-turn operation that allows them to close tighter than common windows. In addition, a ventilation system and heat exchanger will be installed so stale air exhausted from the kitchens and bathrooms warms fresh incoming air supplied to the unit bedrooms, making use of otherwise wasted energy.
The first phase will cost about $14.6 million. Officials estimate the cost differential will be about 11% more than if the building used standard construction. Much of the development’s funding, about $9 million, is coming from LIHTC equity from Wells Fargo.
Orchards at Orenco comes at an important time as Hillsboro experiences significant growth. Intel has been expanding its giant facilities in town, and other companies have also relocated to the area, bringing new jobs and increased demand for housing.
Although the project may cost more up-front, officials believe there will be long-term savings for residents. As the first building nears completion, REACH will begin work on a 58-unit second phase. It won’t be built to full Passive House standards, but some elements may be incorporated.
In the months ahead, all eyes will be on Orchards at Orenco and Uptown Lofts on Fifth to see the results. “Every successful project is a model,” says Knezovich.
Connect with Donna Kimura, deputy editor of Affordable Housing Finance, on Twitter @DKimura_AHF.