This article was originally featured on our sister site BUILDER.
Tony Valle, vice president of Fort Lauderdale, Fla.–based Stellar Homes Group, has a nose for incongruity. “In the Sunshine State, no one wants to take advantage of the sun,” he says, referring to fellow Florida home builders.
“We feel that South Florida should be leading this whole state, but nobody is jumping on and doing this,” he adds. “We want to take the lead.”
Stellar Homes now offers a new standard feature in its homes: A photovoltaic (PV) solar panel system with a 30-year warranty. Valle claims the company is the only builder in the market to do so.
Valle’s boss, Larry Baum, co-founder and managing partner, says when he initially came up with the idea to include PV systems, he wanted to advance the “green movement” in Florida. But first, he and his team had to learn how to do it.
While Baum flew around the country to see how different builders were embracing green technology, Valle focused locally. He reached out to utility provider Florida Power & Light in addition to Florida builders who were offering green products on a smaller scale. Quickly, Valle says, it became clear to him that local builders were guilty of greenwashing.
“As I would ask specific questions, they wouldn’t have any answers,” Valle says. “It’s a great marketing term to use for an uneducated buyer, but I knew right then and there that I never wanted to fall into that category.”
The team at Stellar Homes decided it would go beyond just building homes with standard solar panels. “We can’t dip our toe into the water; we have to jump in,” Valle says.
The result of that jump? Combined with the solar panel system, each new home will also include:
Passive solar daylighting through positioning of windows and doors to maximize natural light;
Hybrid water heaters (eligible for a federal tax credit) that deliver hot water 70% more efficiently;
Low-flow shower heads, toilet, and sink faucets;
Zero VOC paint sealants and adhesives; and
Greenguard Gold Certified underlayment for all floors upstairs.
Stellar Homes also installs three times the required insulation on the exterior block walls. The new homes will be equipped for electric cars, include organic vegetable gardens, and will feature drought-resistant landscaping. “Solar’s a huge component of what we do, but it’s combined with the other features that will offer the end user a tremendous savings on a month-to-month basis,” says Valle.
While these new features will come standard, the cost will not be rolled into the price of the house.
Competition in South Florida is such that Stellar Homes had to lower its margins in order to make the initiative work. The average margin in the area is 26% to 32%, according to Valle.
“When we decided to move forward with this, we knew that our margins would be lower because we did not want to push this cost that we’re incurring onto the buyer because the market’s too fierce,” he adds. “We had to be very savvy in what we selected and what we could negotiate to get good pricing.”
One reason Stellar Homes can offer this package is technological advancement. Valle likened solar panels to LED televisions—not long ago, a 60-inch TV might have cost thousands of dollars, but today it’s attainable for a few hundred. “We discovered that the cost of panels are returned back to the user in eight to 10 years; five years ago it was 36 years,” he adds.
Each solar panel system has a retail value of $9,160 to $16,128 per home (depending on the community). The energy conservation features as a whole are expected to result in an estimated energy cost savings of approximately $81,000 per home over 20 years, Valle says.
The margins may be lower, but the profit is still there. Stellar Homes is currently building new homes, priced from the low $800,000s, in Cavalia Estates in Davie; in Velero at Sailboat Bend in Fort Lauderdale; and in Boca Villas in Boca Raton. Since June, the company has sold 12 of the 20 homes (as of August) it plans to deliver this year, Valle says; in 2017, it will aim to deliver 100 to 120 homes.
“The demand is there for sure,” Valle says. “The direction we’re headed we feel very strongly about.” Plus, as more consumers become educated on green technology, these types of practices will become standard, he adds. “It’s a beautiful thing to be ahead of the curve.”
Baum is hoping more builders and industry professionals will follow his company’s lead.
“Here in Florida, it’s more of a new thing, and we don’t get an increased value if we build green or not, and we want to change that,” he says. “Because if you put more money into the house, but at the same time you’re doing good for the environment and saving the consumer money, there should be added value to that.”
Since Florida is one of the most populous states in the country and still growing, Baum asserts these green practices will be key to preserving the local environment.
“We have a real hope that the building community and the finance community for home ownership and rentals give more value to these type of building practices,” he says.