City of Austin has mandated an energy audit requirement for all apartment buildings 10 years or older (with some exceptions).
The Energy Conservation Audit and Disclosure (ECAD) ordinance requires Austin multifamily properties that receive electricity from Austin Energy to have an energy audit by June 1, 2011. The city defines apartment buildings as property with 5 or more units.
The audit primarily covers these areas: efficiency of the duct system, attic insulation, and windows. This audit helps identify energy cost-saving opportunities but will add an expense to an investor's holding to comply. For more details visit the apartment building ECAD ordinance.
What this means for investors looking to buy:
- An extra building evaluation that could produce some negotiating points on the purchase
- The cost of ECAD inspection, if not already completed, needs to be negotiated upfront
- Potentially better maintained properties will result due to this city mandate
What this means for landlords:
- Some expense will be incurred to comply
- Owners with a newer apartment buildings built after June 1, 1999 can be exempted
- A copy of the report must be posted at the property and provided to prospective tenants and buyers
- Non-compliance can lead to a class C misdemeanor per the city ordinance
The effectiveness of this ordinance remains to be seen. We will track this ordinance and its affects going forward.
