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Press Release

Green Financing Leader Fannie Mae Announces Green Rewards for Multifamily

May 14, 2015

Callie Dosberg


WASHINGTON, DC – Fannie Mae (FNMA/OTC) today announced Green Rewards, a new multifamily financing option that helps owners of apartment buildings and cooperatives invest in energy- and water-cost saving improvements. These investments can improve and preserve the quality of multifamily properties and lower utility costs, saving money for both property owners and renters. Green Rewards is available today nationwide.

“Green Rewards does just that, it rewards borrowers for investing in smart property improvements by giving owners a lower all-in interest rate and access to more loan dollars,” said Jeffery Hayward, Executive Vice President and Head of Multifamily at Fannie Mae. “The resulting greener property really has rewards for all of housing’s stakeholders: it means increased cash flows for the owners, lower utility expenses and better quality housing for tenants, and a high quality asset backing our MBS for investors.”

Green Rewards provides property owners with both extra loan proceeds and a lower all-in interest rate.  For example, a multifamily property seeking to refinance a $10 million loan could receive an additional $250,000 in loan proceeds to make energy- and water- saving improvements that will reduce its annual $140,000 energy and water costs by 30 percent. Green Rewards includes a portion of the owner’s and the tenant’s projected energy- and water-cost savings in the loan’s underwriting, resulting in greater loan proceeds than a typical loan.  In addition, Green Rewards reduces the all-in interest rate by 10 basis points; on the same $10.25 million loan this could result in savings of more than $98,000 in total interest over the 10-year loan term.

With Green Rewards, property owners can make smart investments that reduce energy and water expenses, generate electricity or result in a third-party green building certification, including installing ENERGY STAR® certified HVAC systems, electricity-generating solar panels, water-reducing irrigation systems, or applying for a Green Building Certification, such as ENERGY STAR® or U.S. Green Building Council’s Leadership in Energy and Environmental Design (LEED) certification.

Both conventional and affordable multifamily properties are eligible for Green Rewards, as well as cooperatives, seniors, military and student housing properties. Properties may be located anywhere in the United States, and must be able to project a 20 percent minimum consumption savings in energy and/or water. To track energy performance over time, owners with a Green Rewards loan must report the property’s ENERGY STAR® score annually. The additional loan proceeds must be reinvested in the property within 12 months of loan closing.

Green Rewards is the latest green financing innovation from Fannie Mae Multifamily. Fannie Mae announced in February that multifamily properties with an existing Green Building Certification will receive a 10 basis point reduction in the interest rate on new loans.  In 2011, Fannie Mae introduced Green Preservation Plus which supports the preservation of affordable housing, providing up to an additional five percent in loan proceeds to affordable housing owners seeking to make energy and water efficiency upgrades at the time of acquiring or refinancing the property.   Fannie Mae also recently reduced the all-in interest rate on its Green Preservation Plus loans by 10 basis points.   Fannie Mae is the market leader in green solutions for the multifamily industry, providing over $130 million in Green Financing as of the end of 2014.

For more information on Fannie Mae’s Multifamily Green Initiative, please visit

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