TheBanker
John C. Marsh Jr.

Bath Savings Institution was the lead bank for Creekside Village, a $7-million-plus senior housing initiative. To help keep the building affordable, we applied to the Federal Home Loan Bank of Boston’s Affordable Housing Program (AHP) and received a $400,000 grant and a $495,000 subsidized advance on behalf of the Brunswick Housing Authority. We also provided a $3.5 million construction loan for the project.

On a project like this every penny counts. The $400,000 AHP grant meant the developer had to borrow less over the long term. The advance allowed the project to finance its long-term debt at a discounted rate. This initiative provides housing for low-income seniors, so there won’t be much cash flow for making loan payments. Most of the income from this development will pay for utilities and other operating costs.

We at Bath Savings are open to the use of green building features in the buildings we finance. We believe communities need to move in this direction to reduce carbon emissions and energy costs.

Several years ago I attended a MaineHousing conference on the new Green Building Standards. At the time green building was still new to many of us. We were curious, but we didn’t know much about it. I thought, “This is great, but are they going to be able to make this work?” The reality is, it’s working now.

Although green features may in some instances be more costly, we believe they will save money in the long run through reduced energy costs. Those savings eventually get passed on to residents in the form of lower rents. Reducing energy costs improves the cash flow of a property and provides residents with more disposable income to spend in the community. Creekside hasn’t opened yet, so it will take a few more years to know if the green features actually lower operating expenses.

In recent months, I have been talking with several developers who plan to build green projects. One involves the development of affordable single-family homes by one of MaineHousing’s first certified builders. We discussed the possibility of applying for AHP or Equity Builder Program funding to help finance this development.

This developer believes that installing green features will soon be a requirement of residential construction. He says there is significant consumer demand for green homes and believes he can build homes that use solar and wind power to generate all of their electricity.

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