Kensington Condo 2
As Alex Speigel explains it, he and his partners went against the grain, and it paid off.
They are the developers who, under the name of Context Development Inc., are converting the old George Brown College buildings in Kensington Market into a 140-unit condominium.
Condo developers are different from developers who build, and then rent, says Speigel. Their goal is to sell condominiums, not to become landlords.
Landlords like low operating costs that will keep their utility bills down. Condo developers like low capital costs that will keep down the selling prices of their units. They don’t have the same worry about the monthly heating, electricity, and cooling bills, because it will be the condo owners that will have to pay them.
The result, says Speigel, is a disincentive for condo developers to search out ways of minimizing those bills.
But projects such as his may be changing the equation. Context Development decided to go green in this $20-million conversion, and to market the condominiums as environmentally responsible. It was a remarkably successful strategy. The units sold out within a month and a half of going on the market.
Among the green initiatives taken is a heating and cooling system for the three buildings in the complex that will cut monthly costs by 25 to 30 per cent. Installing the system, however, came in at 10 to 15 per cent more in capital costs.
The buildings achieve the operating savings by distributing heat — the solar gain — from sunlight. Solar gain is free heat, and in buildings that face south, such as the Kensington condo, where there is plenty of sunlight coming through windows, there’s a lot of solar gain.
The trick is to take heat from where it’s too warm, and deliver it to where it’s too cool.
The Kensington condo does just that. Water circulates through the building in a single loop at a temperature that ranges from 20° to 25° Celsius. Where water pipes pass through a unit where cooling is required, heat from the unit is transferred to the water by a heat exchanger, thereby cooling the rooms. Where the pipes pass through a unit that needs to be warmer, the heat exchanger takes heat out of the water and blows it into the rooms.
Typically, it will be south-facing units that will become too warm on sunlit days — winter, spring, and fall — and north-facing units that will need the heat.
The heat exchangers in each unit are driven by electricity, and there is a cost for that. But it will be far below the cost of tapping into central air conditioning, or firing up the natural gas furnaces in the buildings to provide more heat.
The units sold in a range from $89,000 to $300,000, with the bulk going for $130,000 to $160,000. Buying into an environmentally responsible building was « definitely a factor for quite a few people,’’ Speigel says. « If people are savvy enough, they look at the condominium fees as well as the selling price, and ours worked out to 23 cents a square foot (per month). Typically the fees are 30 cents to 35 cents a square foot.’’ In other words, at the Kensington condos, the fees are cheaper by up to one third.
Most of the reduction in fees came from the saving on heating and cooling costs. The rest came from eliminating extras, such as providing a concierge, and an exercise room, which Speigel says wasn’t necessary because there are so many fitness clubs in the area.
The bonus for going green was the condos sold quickly, lowering the marketing and carrying costs for Context, and offsetting the added expense of the heating and cooling system.
In the end, Context has its profits, the condo buyers save on their fees, and the environment benefits through reduced use of a non-renewable resource (natural gas) and lower carbon dioxide emissions from the furnaces. It proves you can indeed do well by doing good.