Builder finds green complex brings in green

Run Date: September 24, 2007

By Katherine Conrad
Mercury News

Environmentally friendly townhomes in Palo Alto attract buyers despite slump in housing market

Builder Warmington Homes went out on a very green limb when building a townhome development in Palo Alto, bu the risk seems to have struck a chord with buyers — even in a poor market.

In a commitment to the environment rare even in the environmentally friendly Bay Area, developer Warmington Homes has installed a range of energy- and water-efficient features — from solar panels on every unit to extremely low-flush toilets — at its 76-unit townhome project.

Among the other green features: drought-resistant landscaping and tankless water heaters. And while solar is increasingly common in the Bay Area, it’s usually only an option offered by builders. Warmington took the unusual step of making it a standard feature.

Cheryl O’Connor, vice president for sales and marketing for Warmington, explained the developer’s thinking.

“Green is part of the culture. It’s part of the buyer profile,” she said. “I’ve been doing this for 30 years and I’ve been through three recessions and two droughts in my career. I just had a gut feeling that more educated buyers would buy green.”

Apparently she knows her market. In a decidedly down cycle, she says Vantage has sold 32 of the townhomes even with prices that start at $850,000 and head up into the $1 million territory. Throughout most of the summer, Vantage has been either the most popular new home development in Santa Clara County in terms of people touring the project, or in the top four.

Green begets green in P.A.

Even more telling, Warmington has raised its prices from the initial $810,000 listed in late spring.

Buyer Andrew Yu, a director of engineering for Yahoo who moved in two weeks ago, was attracted by both Vantage’s Palo Alto address and its green features. “I definitely like the dual-flush feature to save water,” he said. “I think this is a really smart thing to do.”

Jerry De La Piedra, senior water conservation specialist for the Santa Clara Valley Water district, agrees. “Toilets are the No. 1 water user indoors,” he said. “People don’t realize it.”

The dual-flush models, common in Australia and other warm climes, cut water usage by 20 percent compared with even low-flush toilets and have just started entering the Bay Area market.

Since late 2003, the water district has offered rebates of $125 to homeowners encouraging them to replace toilets that can use from three to seven gallons of water per flush with either low-flow or dual-flush high-efficiency toilets, which use an average of 1.3 gallons per flush or less.

The dual flush models use different amounts of water depending on the waste that needs to be disposed of.

While the city of Palo Alto applauded Warmington’s decision to install solar panels, it has proved costly for the city, which offers rebates for solar roofs.

“We’ve never had a residential developer decide to put solar in,” said Lindsay Joye, Palo Alto’s marketing engineer. “It’s a huge deal to make solar standard and not an option.”

The city’s 8-year-old rebate program gave back $3 to the builder for every watt of energy produced. (The program just dropped the amount to $2.80 a watt.)

At 2,000 watts per unit times $3 times 76, the total is close to half a million dollars, a staggering amount for a city accustomed to paying an average of $300,000 a year in rebates.

Joye said the city tapped into other energy programs to pay the bill, plus the developer helped by spreading the cost out over two fiscal years.

“We had to go to the city council to get it,” she said. “We’ve never had that much of a hit before.”

Sam Zhou, another new homeowner, just moved in with his family of three. While he was attracted by the green features — especially after the rolling blackouts during the summers of 2000 and 2001 — so far he’s lukewarm on the toilets.

But he loves the solar panels. “We have not yet received any power bill yet,” said Zhou, who moved to the United States from China almost 20 years ago. “The real question will be much power the panels save.”

Zhou said living in such an environmentally friendly home makes him feel good, especially after returning from China every year where he visits his parents.

“The pollution over there is so bad. When we were buying this house, it’s sort of all related,” he said. “You have to be conscious about the environment you’re in so you can save it for the future generations.”

Green Townhouses

Vantage townhouses range in size from 1,200 square feet to 1,600 square feet; the 76 townhouses range in price from $850,000 to $1.2 million
Green features include:
2 kilowatt photovoltaic system on every roof
Dual-flush toilets: 0.8 gallons to flush liquids and 1.6 gallons to flush solids
Energy-efficient dishwasher, windows, air conditioning and heating units
Motion sensors and a climate control station to turn off lighting
Tankless hot water system
Native landscaping that is drought resistant
Drip irrigation for landscaping
Materials from the demolition of three office buildings formerly on the site were recycled
Recycled fly ash in the concrete
Engineered lumber substituted for solid-sawed lumber

Katherine Conrad reports on commercial real estate
kconrad@mercurynews.com or (408) 920-5073.

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