Mission Metrics: Case Studies on Impact Part 2
Written By: Aaron Fairchild, CEO of Green Canopy
Green Canopy’s neighborhood engagement started with our first home in West Seattle in 2010. We painted the home a shade of green that our neighbors rejected immediately and publicly via social media. We were taken aback. This certainly wasn’t the “impact” that we had hoped for. Our nascent team had just begun working together with a mission to inspire and this quickly became a moment to listen and learn. We invited all of our neighbors to meet onsite and tour the construction project and vote on the color to repaint the home. This was our first opportunity to talk to the community about our mission, gather feedback and learn more about our neighbors, their values and, of course, a better choice for paint color.
Since that time Green Canopy has increased its commitment to neighborhood engagement in a number of ways. The company has hosted barbecues, sponsored block parties, held educational events on green building, hosted happy hours highlighting local non-profits, and more. The company has also programmatically adopted the Community Color Program to select the color palette that we use to paint every home. Additionally, in 2012 the company formalized our introduction to the neighborhood with a “Meet the Builder” community meeting. This is neither required by the cities in which we build, nor embraced by the associations to which we belong. The Green Canopy Meet The Builder community meetings represent an early chapter in the story of every project, helping to set the tone once construction begins and ultimately ensuring greater community inclusion and consideration than otherwise.
In October of 2014 we layered into the Green Canopy Meet the Builder community meeting, an online neighborhood survey. Since that time, we have held over 20 community meetings and received results from 15 communities with responses from over 100 neighbors in Portland and Seattle. Once the surveys have been completed we process neighbor’s responses and send all responses back to the community members that filled out a survey. The responses are shared anonymously; yet when we review these results we receive highly informative feedback, which we use to learn, adapt and inform the Green Canopy team about the unique story of every community in which we build.
For the first time, we are producing the results of the community surveys from which we have learned so much – they are full of critique, feedback and grace - take a look for yourself and let us know what lessons you learn in the comments below!
Download Green Canopy's Community Survey Responses to learn more about the communities in which we work.
Mission Metrics: Case Studies on Impact Part 1
"The current housing crisis can not be easily solved because the issues are not black or white. Our solutions will require a more colorful, creative and collaborative approach."
Written By: Aaron Fairchild, CEO of Green Canopy
Green Canopy is a walkable urban infill developer with a mission to Inspire Resource Efficiency in Residential Markets. Since our company's inception, we believed one solution to our global resource scarcity and climate change issues should be infill homebuilding done differently. So began our journey to create a different kind of homebuilder that is more socially and environmentally aware and responsive. In the weeks ahead Green Canopy will publish a series of blogs and data sets that highlight some of the more curious approaches we incorporate to help create positive social and environmental outcomes.
We began Green Canopy as a for-profit, market-based model with the desire to make a difference. The thinking was that if we were successful in making a difference, profits would follow and allow the Company to scale our outcomes and impact.
As a mission-focused homebuilder we are often looked at with confusion and curiosity from other homebuilders. Occasionally we are mocked and written off as “do-gooders.” It is often assumed that we really don’t know what we are doing. After all, homebuilding is an old profession, historically operating in a similar manner for generations.
Well, the times have changed in just one generation, and many of us have not yet recognized it. In the last 50 years the population has doubled. The consumption of water and food has tripled and the use of fossil fuels has quadrupled. Species are going extinct at a rate of 1,000 to 10,000 times of the normal background rate of 1 to 5 a year. We currently lose dozens of species a day. Humans have done more irreparable damage to the planet in the last 50 years than all of humanity before. Today, humanity continues to flood our cities in droves. Managing the increased density has triggered a serious societal housing problem that will likely be with us for years to come.
As a result, Green Canopy is increasingly relevant in these turbulent times. However, our business model is not a perfect solution, and no solution is. Our housing crisis will not be easily solved because the issues are not black or white. Our housing issues are full of pigment requiring more colorful, creative and collaborative approaches.
Embedded in this thinking, perhaps a silver pellet is revealed? Green Canopy is not a panacea. We are simple. Green Canopy is not particularly sexy. We are straightforward. Green Canopy is not a silver bullet. We are just one pattern in the colorful quilt of potential solutions needed to increase access, affordability and sustainability in urban housing.
In 50-years from now, when we have 14 billion human heart beats on the face of the planet, underwater coast lines, food and water security issues, what will our cities look like: Bastions of hope, or of hopelessness? In 50-years Green Canopy’s homes will still be standing as evidence of the purposeful actions that an earnest group of investors and operators took to help make our cities bastions of hope and opportunity.
With waves of humanity flooding into our neighborhoods, and no simple or easy solution to address our density issues, take some time to read through these two Sightline research articles. They are informative, well researched and helpful as we consider the choices ahead of us. Both of these articles highlight the need for Green Canopy’s approach to increased density.
By: Krystal Meiners, Director of Marketing
What are the most impactful personal or business choices I can make to fight climate change? And is it my responsibility to do so?
As Green Canopy gears up for our first Empower Happy Hour of the year – I’ve been thinking about Forterra’s question of the evening. What are the most impactful personal or business choices that I can make to fight climate change? And is it my responsibility to do so? The second part always resounds with a bright, assertive “Yes!” in my mind. However, the other part of this question flutters and lands throughout my workday, across my desk, in and out of meetings; with answers both big and small. What are the most impactful personal or business choices that I can make to fight climate change?
My internal responses tend toward the personal solutions; challenges to buy local, volunteering for park cleanup in my community, reducing my consumption, eating more vegetarian meals, meditating on the power of fresh air, spending more time with my family outdoors connecting to nature. Beyond the personal, though, what are the business solutions that I can lean into to fight climate change?
In our Energy Performance Guarantee Program at Green Canopy, we have the opportunity to influence and incentivize conservation behavior with our homeowners. This guarantee amplifies our impact and empowers our homeowners to be able to live more efficiently and with a smaller carbon footprint than the average Seattle homeowner. We guarantee that each home that we build will perform as it was modeled by our third-party energy audits, or we will reimburse our homeowners the difference.
For the past two years, we have collected energy performance data through this program with surprising results. What we learned was that the majority of our homeowners were not buying into the program, and that the ones that did admitted that they did not understand their building systems well enough to operate their homes efficiently. Nearly two thirds of the claims that were submitted to us were showing overages beyond our 3rd party energy models. The average deviation from all of our claims was a 966kWh overage against the model. While that number is not a lot considering the average Seattle home consumes over 28,000kWh in a year, we still believe that this program is an incredible opportunity to influence, inspire and educate our homeowners. We want this program to be able to drive efficiency in our product in order to create real impact in our fight against climate change.
That is why our team is actively working to improve our process, educate our homeowners, and collect more data in order to achieve greater effectiveness. At the end of the day, we do more than just build homes. We want to live into our mission to inspire resource efficiency. The Energy Performance Guarantee is simply one business solution that we have that empowers our homeowners to live better, more efficiently and closer to the planet that we share.
Stay tuned for more ideas in our upcoming blog series "Mission Metrics: Case Studies on Impact."
A Response from Aaron Fairchild, CEO of Green Canopy, Inc.
For those of us that are deeply concerned with the current Presidential administration, I thought I would offer acknowledgement in solidarity and a potential response to consider throughout each day as you continue protesting in the streets across America.
Trump is a self-professed businessman and has proclaimed that he will create perpetual economic growth throughout his Presidency and beyond, even at the expense of equity and the environment. To which we can, and should respond with a resounding, “No!" Natural limits to growth exists as populations grow and resources diminish. Perpetual economic growth at the expense of equity and the environment simply cannot be sustained, nor should the idea be tolerated as acceptable.
For years the “buy local” movement has been a compelling response to the perpetual growth model and well articulated in Wendell Berry’s short book of essays, “In the Presence of Fear." Buying local, and all that it entails, helps to strengthen our local communities and economies as we work to address our environmental and social equity issues in a more sustainable and less consumptive manner.
Today we find ourselves confronted with a Presidential administration that is happy to operate as a bull in global and national “china-shops,” rolling back environmental regulations not to mention our constitutional liberties. Given this as the backdrop it is more important than ever to perhaps reconsider our consumption behaviors and retrench to our local establishments and communities. The consumer has the loudest voice in our democracy. If consumers change their behavior, companies take notice, and correspondingly so do politicians.
To this, I ask you to send a message to this administration along with me and thoughtfully limit your consumption of global brands, and perhaps in general. Will you join me in more deliberately and critically considering the purchases you intend to make? Can you think about holding off, or reflect on not going out to dinner or away for that vacation? Perhaps consider focusing on local purchases, “stay-cations”, dinners at home with family and friends and making your investments locally.
But you may say, “Aaron, buying local and limiting our national consumer trends by perhaps even 5% would certainly cause a recession!” Frankly, is there a better way to send a message to a President who has trumpeted his business and economic acumen? Perhaps there is, however corporate sponsors won’t continue clinging if their numbers go down. Protest with your pocketbook and send an economic message to a business baron and let go of fear of a potential self-induced recession.
Recessions come and go, and if a recession were indeed to arrive as a result of buying local, perhaps it would be more easily corrected than otherwise. More importantly, a recession caused by conscious consumption puts economic control in the right hands; in your hands, the hands of the people and not corporations or politicians. Send a message and buy locally, invest locally, walk to a friend or neighbor’s house for dinner, take transit, and walks in the dark and beautiful woods instead of heading to the movies.
If you ever needed an excuse or a little nudge to buy local and perhaps even less, the excuse sits in the White House and the nudge is constantly viewed on your news push-notifications. Take action throughout your every day. Consider more critically and deliberately as you buy products and consume goods. Mindfully, in the moment, think about buying less, buying local, investing local. Let go of fear and embrace the power of your pocketbook to create change.
Share an easy, yet meaningful idea as a comment below that may be helpful to others as we all align to living and buying more locally.
With the annual Built Green conference is only five days away, we’re getting increasingly excited to gather as a community of green building professionals to exchange ideas, connect and honor those among us who have done an outstanding job this year of bringing people into Built Green homes. Before heading into the weekend, we took a minute to get to know one of our Selling Agent of the Year finalists – Daniel Burton of Redfin.
AN INTERVIEW WITH Daniel Burton
When looking at the Values vs. Abilities diagram, the obvious priority would be to only hire those who fit within the top right box. They are the ideal and perfect Teammates, right?
However, in practice we recognize that the top right box is the area to strive toward and is generally an impossible space to permanently occupy. All of our Teammates have areas of their work in which they are masters of their craft
(1) As a quick side note on work as Practice rather than a Performance, we highly recommend this HBR Ideacast (Ideacast #523) released May 5, 2016, with Robert Kegan and Lisa Lahey.
Why is this data useful? It is a market insight that clearly shows builder trends and market impact. The data reveals the local trend toward more sustainable construction practices that impact our region and our nation. As Seattle remains at the top of national growth centers - builders here are in the spotlight and the quality of our housing stock sets a precedent.
So, how do Green Certifications impact our market? The Built Green certification standard means that Built Green certified homes were built to a standard that is beyond code. Simply put, Built Green certified homes are better than code-built homes because they are built to a standard that meets and exceeds our building codes. Not only are certified Built Green homes better quality than standard code built homes, but they cost less to own, have a reduced impact on the environment and put less strain on our water and energy resources. They are less toxic and have better indoor air quality which is imperative considering our growing asthma rates for adults and children across the US. Life in these homes are simply more comfortable and healthy.
Why aren't all builders building to this standard? Often the argument you hear builders make for not building to a standard that exceeds code is that it costs too much money, or that people will not pay extra for better quality. And yet most of the builders in the Top 20 are building at least some certified Built Green homes. So it stands to reason they have figured out how to make it work. Green Canopy would like to continue to encourage the Seattle homebuilding community to advance our collective building practices and embrace green building standards and techniques wherever and whenever possible. There will always be better quality homes than others, and homes that are more “green” than others. For those builders that have built and are continuing to build leading edge quality homes – THANK YOU and keep on keeping on blazing the trail for all of us to follow!
Impact investing in green home development aims for profitability on a triple bottom line
SEATTLE, Washington (December 22, 2015) – Green Canopy is excited to announce that we have eclipsed a major milestone with our second Impact Debt Fund. The Alder Fund is a Real Estate Impact Investment Fund that is managed by Green Canopy and designed to lend on the development of certified green and guaranteed efficient homes. It has now issued its last loan and will begin winding down – issuing distributions as loans repay over the next 6-9 months.
With the help of the Fund and all of its participants, Green Canopy completed 50 high efficiency homes across Seattle, reaping a total energy savings of 532,000 kWh per year. “We have mitigated over a million pounds of carbon in the last two years by building Green Canopy homes. That’s the equivalent of planting nearly 30,000 trees every year,” says Sam Lai, the CMO of Green Canopy. “These are metrics that our investors look at when they consider putting their capital to work for a cause. Of course it is also about returns, but not just so.”
The Alder Fund launched in October of 2013 with $7.7MM. Of the 50 Green Canopy homes that were built, nearly 25% of them were sold at price points below $450k in an effort to attract middle and lower income buyers in the Seattle market. These pricing targets were set by Washington State Housing Finance Commission, who partnered on several projects with Green Canopy with the hopes of providing green and energy efficient homes to buyers who also qualify for the Commission’s down payment assistance programs.
“This Fund, which eventually lent over $29MM for the completion of 50 homes, has been especially prosperous, and is an indicator of what mission aligned and market driven capital can accomplish,” said Andy Wolverton, the Fund’s manager and CFO of Green Canopy Homes. “The Alder Fund’s success is certainly reflected in our triple bottom line – and brings more than just monetary returns to our investors.”
The return profile for the Alder Fund is 9-12% annualized - and so far it is on target to achieve that goal. Over 50% of the investors have reinvested in the Birch Fund, Green Canopy’s third Impact Investment Fund which began raising capital this summer. The Birch Fund is targeting a total raise of $20MM and hopes to increase the number of affordable homes for sale here in Seattle and in Portland.
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Decision making and benchmarking frameworks are integral to Green Canopy’s operations. Our acquisitions team uses a data driven framework and metrics to identify and purchase attractive development properties. Our project managers use a framework for guiding construction related decisions from start to finish. The reporting outputs are used to inform and manage future acquisitions and projects.
These carefully crafted systems support us in driving toward consistent execution and continuous improvements. We learn from the successes and failures of our decisions by establishing baseline metrics and measuring and reporting against them. This ultimately makes Green Canopy a better homebuilder. And importantly, creates a stronger and more resilient company, reduces risk for our debt fund members and builds a more valuable brand for shareholders.
Investors face similar challenges, especially those pursuing positive social and environmental impacts alongside financial performance. Without a guiding framework, impact investors are left to untangle a confusing mix of information and options. An impact framework can be a transformative tool enabling investors to move beyond intuitive guesswork toward more systematic and objective decision making.
We hope you will join us in attending an event, Impact Investing with Purpose, being hosted by The CAPROCK Group and SNW Asset Management on Tuesday, October 20th, 6 to 8 PM at Seattle Impact HUB. Green Canopy board member Kyle Mylius will moderate a panel exploring the evolution and use of impact investing frameworks and metrics. Panelist Luni Libes, a familiar face to many of you from Fledge and Pinchot University, will offer insights into The Pinchot Impact Index, the subject of Luni’s recently published book. The event will close with a preview of CAPROCK’s iPAR impact investment framework and evaluation platform.
If you plan to attend you are asked to RSVP here.
The Green Canopy blog is written by our CEO and Culture Curator - Aaron Fairchild, as well as our staff and a few very special guests.