Energy Loan Will Be Repaid Entirely From Energy Savings
Energy management company FS Energy, LLC, a subsidiary of FirstService Corporation, today announced the financing of a large scale energy retrofit project at Turtle Bay Towers. FS Energy played an integral role in helping to secure financing on Turtle Bay’s behalf.
Last year, FS Energy announced an innovative partnership with top-tier financial institutions to arrange loans to finance energy efficiency renovations for residential properties managed by its parent company, FirstService Corporation, and its New York City affiliate, Cooper Square Realty. This first-of-its-kind energy loan program secures each loan with an escrow of the energy savings achieved after the renovation. Thus, a mortgage is not recorded and the loan will be repaid at attractive interest rates that allow the project to be financed solely through energy savings.
“This is the first of many energy efficiency loans we will coordinate with our financial partners for the benefit of our managed properties,” said David Kuperberg, CEO of FS Energy.
“As a result of this project, Turtle Bay Towers will save approximately $187,000 per year in operating expenses, which means savings will exceed costs in less than three years. We’re excited to offer this financing option to properties managed by Cooper Square Realty, enabling them to maximize property value, reduce costs and limit their carbon footprint,” he added.
This energy retrofit project will enable the Manhattan property to reduce its carbon output by more than 540 metric tons annually, or the equivalent of taking 106 cars off the road.
Turtle Bay Towers, a 25-story, 338 apartment luxury cooperative apartment building used the loan to replace a boiler, install two new high tech oil burners, and upgrade the chimney and control system. Now, the building can burn both natural gas and No. 2 oil, and phase out the soon-to-be-banned “dirty” No. 6 oil previously used to fulfill the building’s heating and hot water requirements. Originally built as a commercial property in 1929 and converted for residential use in the 1970s, the property was operated as a rental building until 1988 before converting to a cooperative ownership structure. Turtle Bay Towers has been managed by Cooper Square Realty since 2005.
“FS Energy has clearly demonstrated the value of implementing an energy efficiency initiative that lowers energy consumption and reduces operating expenses,” said Wade Brennan, a member of the Turtle Bay Towers shareholder-elected board of directors. “We were impressed with their ability to customize a program specifically to fit our needs, while introducing us to this attractive financing option.”
“Most board members in cooperative buildings understand the importance of implementing a customized energy efficiency initiative, and thanks to this unique loan agreement, many can now easily and affordably convert from oil to gas without the need to make a huge capital investment,” said CEO Kuperberg. “In addition to the financial and environmental benefits, an upgrade of this nature will improve residents’ comfort without increasing monthly fees.”
In addition to facilitating the loan agreement between the participating financial institution and Turtle Bay Towers, FS Energy designed the custom energy management plan and is overseeing the project. Upon completion, FS Energy will apply additional no or low cost measures to ensure the maintenance of these new systems, including employee training.
FS Energy is currently spearheading the management and financing of several energy efficiency capital investments for New York City residential properties managed by Cooper Square Realty.