The Benchmarking season is about to start. However, a heads up is needed because of additional requirements for this year – which follow:
First, the Benchmarking Platform has expanded. It now includes smaller buildings. Until this year, Benchmarking was limited to buildings 50,000 sf and larger. Now we’re talking about smaller buildings – starting at 25,000 sf. Check your portfolio to make sure that no building is inadvertently overlooked for Benchmarking compliance. The good news is that the penalties for missed filings remain the same for both the larger and now the smaller buildings. Penalties continue at $500.00 for each missed filing deadline – starting with May 1st of each year there is an add-on $500.00 penalty for each missed filing for every three month period thereafter. The penalty cap of $2,000 for any given Benchmarking year continues.
Next, your Benchmarking results for this coming cycle must be prominently posted at the front entrance of each building required to Benchmark. Benchmarking scores, for the period January 2019 through December 2019, will be converted to letter grades and then posted in 2020 at all other Building entrances, as well. With Benchmarking grades posted at every entrance of every building, it’s a no brainer that focus on energy savings will be a hot ticket item especially when poor grades might have even the slightest potential of causing a negative impact on apartment valuations. Benchmarking letter grade scores will range from a Grade A, as the most efficient, to a Grade B, and then on down. Most residential buildings will receive a Grade B, which will become the norm for residential buildings. See a building with Grade C or below as being in the penalty box.
With regard to apartment valuations in buildings with a Grade C or below, here is some marketing feedback from knowledgeable residential brokers.
- A Grade C or below suggests a building with deferred maintenance issues. Brokers that show apartments on a regular basis should be updated regarding building improvement plans to respond to questions from potential buyers.
- With older buyers, a Grade C or below would probably not have any significant negative impact, but the broker would need to be able to update the client regarding any plans the building has in place to improve efficiencies in order to achieve a better Benchmarking grade.
- With younger buyers, Brokers would probably try to avoid showing apartments in buildings with a Grade C or below. Brokers feel that younger buyers tend to be focused on environmental issues, so an apartment in a building with a poor grade would be a difficult sale.
Apartment valuations can be a hot button issue that isn’t going away. Our recommendation is for
Managers to get in front of this issue as quickly as possible. Consider taking the following steps.
- Check recent Benchmarking scores to determine if your building(s) has past Benchmarking scores of 50 or below (or even below 55 or below to be on the safe side).
- Develop an action plan to improve poor Benchmarking scores.
- Update Building Board Members for action plan approval and to ensure no one is out of the loop.
Here are some measures that will improve Benchmarking scores:
- Immediately upgrade common area lighting to LED. This measure is a Local Law 88 requirement that will save approximately 50% on electric consumption. Also encourage apartment owners to upgrade their lighting to LED as well, especially kitchens and bathrooms. Less electric consumption – lower monthly electric bills.
- Install a stand-alone domestic hot water heater. This unit for domestic hot water production is entirely separate from the boiler and will allow boilers to rest over the summer. Its high efficiency will improve Benchmarking scores. Because of high efficiencies, there is a very quick payback for this measure.
- Insulate heating and hot water piping. This is a relatively inexpensive measure with quick payback, because of the energy savings.
Buildings with Benchmarking scores of B or even A might consider these measures as well. They all have quick paybacks and will improve the energy efficiency profile of any building. The higher the efficiency, the lower the operating costs.
If your building needs assistance with its Benchmarking Filing Requirements, please contact George Crawford at 212-645-0025 or email email@example.com. Green Partners uses only Professional Engineers to perform these services.
Green Partners will also assist you in a LED lighting upgrade for your building. We will perform a free lighting assessment and for qualified customers, Green Partners will install LED samples at no cost or obligation to ensure a successful LED retrofit.
Contact George Crawford at