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Weekly UpdatesThe mission statement needs to be translated into corporate objectives, which together form the framework for all activities of the professional landlord and, therefore, for its strategic asset management.
* Internal and external analysis
The objectives that have been formulated in the previous step, serve as a handle for the information that will be drawn into the analysis.
An important first step in the analysis is to gain insight in the energy performance of the entire stock on the level of the individual dwellings. Now that the EPBD has been enforced in the European countries, every transaction in the professional landlord's stock adds to his energy performance dataset. However, depending on the turn over rate of his housing stock, it may take a considerable time before data on the energy performance of the entire stock will be available. It might, therefore, prove to be beneficial to calculate the EPBD energy label of the dwellings by using reference dwellings that represent the characteristics of each dwelling type in the stock. A simple approach to define the set of reference dwellings, is to develop a matrix with a division upon dwelling type (for instance detached, single family, multi family without elevator, multi family with elevator, high rise) in combination with a division upon year of construction, with the timeframes roughly based on building construction and step-wise improvements of the energy performance resulting from the introduction of innovations (such as insulation, high efficiency boiler). The reference dwellings can be used to assess not only the EPBD energy label, but also the average energy costs for heating/cooling and hot water production per dwelling and the C[O.sub.2] emission and gas use per dwelling.
The data can be used as input for a portfolio analysis of the stock, similar to employing portfolio analysis for analysing other performances of the stock as has been described by Van der Flier and Gruis (2002). With the portfolio analysis, housing estates that show a deviating performance, and consequently may need attention, can be selected. The portfolio analysis can be based on indicators such as:
* energy costs versus rent level;
* affordability versus EPBD energy label;
* turnover rate versus EPBD energy label;
* acceptance rate versus EPBD energy label;
* vacancy rate versus EPBD energy label.
In addition to the portfolio analysis, it may be useful to gain insight in other subjects regarding energy performance, such as:
* the effectiveness of potential measures/ investments;
* the costs of these investments to improve the energy performance of the stock;
* the willingness of the tenants to contribute financially to these investments, for instance by a rent increase;
* (other) possibilities to finance the improvement costs (subsidies, outsourcing, etc.).
* Policy principles for portfolio development
Now the corporate objectives have been formulated and the results of the analysis are on the table, this information is weighed and structured, thus forming the basis for defining the set of labels and the housing estate strategies.
In this step, concrete targets are formulated. The EPBD energy labelling provides a very effective means to formulate targets upon, for instance "The average energy performance of the stock has to meet at least EPBD energy label C within XX years" or "No dwelling in the housing stock will have an energy performance less than label D in the year XX". Another example is "The total contribution of our housing stock to a reduction of C[O.sub.2]-emission should be XX ton in the year YY", but one could of course also formulate targets with regard to subjects such as comfort level, gas usage, energy costs in relation to the rent, health or indoor climate.
* Defining classification of strategies and Strategy options per housing estate
Based on the previous steps, a classification of possible strategy options is performed in order to define the specific sets of labels that will be employed in these steps.
Subsequently, depending on the specific level, the dwellings, housing estates, neighbourhoods and/or market segments are attributed one or more labels to determine their strategy. This step could be seen as the core of the strategic asset management, because by labelling the individual housing estates, the future of the housing association's total housing stock is decided upon.
The choice of one label can depend on the choice of another label. For instance, if demolition is foreseen within 5 years for a certain housing estate, it has no use to aim at a large improvement of energy performance. If a significant improvement of the indoor climate is desired, 'maintain as is' of the particular housing estate is an unlikely option.
Especially with regard to energy conservation, it could be beneficial to determine the end situation (i.e. the EPBD energy label) and the necessary process as separate entities. Amongst different housing estates the label indicating an end situation may be similar (for example the same energy label) but the strategy to accomplish this label may vary between the housing estates. This situation occurs if, for instance, the tenant group of one housing estate has other demands than the tenant group in an other housing estate, or the technical requirements of an housing estate demand other technical solutions to achieve the target, resulting in other pay-back times.
* Appraisal of strategy options
The strategies that have been assigned need to be evaluated in order to determine their contribution to the corporate objectives and their consequences in terms of energy performance, affordability, size and diversity of the total housing stock and the financial continuity of the housing association. It should, for example, be prevented that an improved overall energy performance results in a significant reduction of the affordability or solvency.
* Estate management plans and Implementation
In the remaining two steps of the asset management model, the housing estate strategies are translated in actual measures, which will be implemented according to the housing estate management plans. In this last phase of the strategic asset management, the actual energy efficiency is realised through taking measures that improve the energy performance of the dwellings.
In section 4, we indicated the possibility to define and employ labels on the level of the dwelling, housing estate, neighbourhood and market segment. Straub and Vijverberg (2004) indicate that, when implementing improvements --which energy efficiency measures usually are--professional landlords have a number of options regarding:
* the scale and time of the intervention (building block at once or per individual dwelling);
* the occupancy status (when occupied, move present tenants to temporary housing or at turnover);
* the initiative (housing association or tenant(-sgroup));
* freedom of choice for the tenants.
In the final step of the energy-efficient asset management process, the general policy regarding energy performance can be put down in an energy policy plan, possible as part of a sustainable management plan. These documents facilitate internal implementation of the strategies and the communication with the stakeholders.
6. CASE STUDIES
In this section, the energy conservation activities of three Dutch housing associations are analysed against the background of their strategic asset management. The three case studies have been selected based on the distinct approach each of the housing associations employs towards asset management and energy conservation. The case studies are based on interviews with responsible members of staff of each housing association and a desk study of the relevant documents of the housing associations such as year reports, environmental policies and corporate brochures.
WonenBreburg
WonenBreburg is a housing association with an asset of 26.830 dwellings, mainly in the cities of Tilburg and Breda. WonenBreburg employs a staff that together equals 393 full time equivalents (WonenBreburg, 2007). An important incentive for WonenBreburg's energy efficiency activities is the Energy Covenant, whichit has drawn up together with the Municipality of Tilburg and three other housing associations for the period 2006-2011. In the covenant, the parties have assigned high priority to energy efficiency and reduction of C[O.sub.2] emissions, in particular aimed at existing housing. The covenant includes targets regarding the implementation of the EPBD legislation and influencing the energy related behaviour of occupants (Tilburgs Energie Convenant, 2006).
WonenBreburg distinguishes 4 general strategy labels for its housing stock: maintain, improve, sale, and demolition. For the housing estates that have been assigned the label maintain or improve, WonenBreburg develops its strategic asset management by matching housing supply and demand. A set of specific markets is distinguished, by determining the relevant target groups and analysing their specific demands. By matching these markets to the characteristics and qualities of the individual estates, an optimal fit between market segment and housing estate is aimed for. In order to be able to perform this match, a set of 26 reference dwellings is used to map the characteristics of the dwellings in the housing estates. When a good match between market segment and housing estate is found, the actual measures for the estate are based on potential improvements, which are listed for each reference dwelling. In this phase, specific attention is paid to energy efficiency (WonenBreburg, 2007).
WonenBreburg gives priority to those strategies that result in a profitable exploitation of the housing stock and an increase in its market value. Nevertheless, WonenBreburg does invest in energy conservation and a considerable share of this investment volume is unprofitable. On the one hand, WonenBreburg realises with these investments its energy conservation ambitions. On the other hand, WonenBreburg takes into account the possibility that forthcoming changes in legislation may help to increase the profitability of earlier energy conservation investments and the possibility that an improved energy performance may have a positive effect on the future market value of their dwellings.
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