UPDATE: Sept. 15, 2023: The Department of Housing and Urban Development announced Wednesday that it has awarded $18 million in grant funding and loan commitments to the first wave of participants in its Green and Resilient Retrofit Program.

This first set of awards, covering the Elements cohort, will fund energy-efficient and resiliency upgrades for 28 multifamily properties with over 3,400 rent-assisted units total. Click here to view the list of recipients.

Dive Brief:

• The Department of Housing and Urban Development has opened its first round of funding applications for the Green and Resilient Retrofit Program, which will provide a total of $4.8 billion in direct loans and grants for HUD-assisted multifamily properties to fund green, energy-efficient and resiliency renovation projects. 
• The housing agency published a set of guidelines and qualifications for potential applicants to the GRRP, including information on each of its “cohorts,” or funding paths. The program is only available for properties with a project-based HUD rental assistance contract, including Section 8, among others.
• The GRRP was first established under the Inflation Reduction Act, which was signed into law in August 2022. The act provided $1 billion to HUD’s Office of Multifamily Housing Programs in order to implement the project, according to a press release.

Dive Insight:

Property owners can apply for one of three cohorts, depending on the property’s needs:

• The Elements cohort is designed for properties in the middle of a recapitalization that includes green and resilient features. Under this cohort, the GRRP will provide up to $750,000 per building or $40,000 per unit.
• Leading Edge funding covers retrofit projects in which the owner is aiming for a qualifying green certification, such as NGBS, Passive House or LEED. Applicants may be at any stage of recapitalization, but are expected to have other funding sources outside HUD. Projects in this category are eligible for $10 million per property or $60,000 per unit.
• The Comprehensive cohort is for properties with high green/resilient investment needs, including environmental hazards. It includes support from HUD on the property’s recapitalization plan. The GRRP will cover $80 million per building or $80,000 per unit, with 50% of the reward reserved for high-impact utility, resiliency or energy generation projects, such as wind or solar power.

Properties with only a partial affordable component may still apply for GRRP funding and use the reward for all eligible retrofit costs, including projects that affect the full property and not just the assisted units. The Leading Edge and Comprehensive cohorts require at least 50% of the property’s units to be HUD-assisted; the Elements cohort has no minimum.

“Implementing the GRRP will provide much-needed funding to reduce water and utility costs and keep the homes of the nation’s low-income individuals and families safe in the face of climate change,” Julia Gordon, assistant secretary for housing at HUD, said in the release. “But GRRP also provides a means of addressing issues of housing equity and environmental justice and reducing these properties’ climate impact.”

Applications for the first round of Elements awards will be open through June 29. A total of 12 funding rounds, four for each cohort, will open on a rolling basis through May 2024. About $2 billion will be distributed in the first set of funding rounds. 

The GRRP is one of a number of funding allocations and rule changes in the Inflation Reduction Act that affect the multifamily industry. The act includes a $9 billion fund for energy performance-based rebates and the High-Efficiency Electric Home Rebate Program, $1 billion to help states adopt residential and commercial building energy codes and $3 billion to improve neighborhood equity.