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Lauren Kubiak’s Blog

Ginkgo Residential: Living Up to Its Resilient Namesake

Lauren Kubiak

Posted August 9, 2013 in Environmental Justice, Green Enterprise, Living Sustainably, Moving Beyond Oil, Solving Global Warming

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Editor’s note: this is a guest post from 2013 Stanback Intern Hannah Matschek.

One way to achieve success in today’s real estate sector is to simultaneously deliver economic, environmental, and social value. These three bottom-line issues can help create a lasting company. But focusing on what one businessman I recently met calls the three P’s – profit, people, and the planet – requires serious tenacity and creativity, as I learned in July on a clean energy tour of North Carolina.  

Introducing Ginkgo

Philip Payne is the chief executive officer of Ginkgo Residential in Charlotte, North Carolina, a successful real estate company that provides high-quality, low-income rental housing that is energy efficient and environmentally sensitive.

From the head of a large mahogany conference table in Ginkgo’s new office, Payne explained how his own passions converged to build a company that now has 130 employees. Payne said that he runs Ginkgo based on his commitment to profit, people, and the planet.

His company seeks to “beneficially and profitably reconcile[s] the social, environmental and economic issues raised by the ownership of, and investment in, real estate assets,” Payne said.

Payne traces his entrepreneurial roots to 1990, when he began working with BNP Residential. Over the course of his 20-year career at BNP, Payne rose to become chairman of the company, steering it through a merger.

Then, in 2010, Payne started Ginkgo. Since Ginkgo’s founding, Payne has run the company by focusing on profit, people, and the planet. He does this by working to “provide high quality workforce rental housing that is energy efficient and environmentally sensitive,” Payne said.

Yorktown Club

Yorktown Club is a 236-unit apartment building in Durham, North Carolina, just a short drive away from both Duke University and the University of North Carolina in Chapel Hill. Prior to Ginkgo’s involvement, the building was nearly unlivable. The back porches were sunken and rotting. There was apartment-wide water damage, mold on the walls, and peeling linoleum on the floors.

Ginkgo purchased the dilapidated building and went to work. Now, it’s a prime example of the kind of workforce housing restoration Ginkgo does.

Yorktown Club: Before (photo credit: Ginkgo Residential) 

During renovations, Ginkgo replaced roofs, installed low emissivity windows, upgraded all appliances using Energy Star—a government-backed energy efficienct appliance certification—appliances when possible, installed Energy Star heating, ventilation, and air conditioning, repaired all existing damage, and made the units more aesthetically appealing by landscaping and creating a community garden.

The majority of the units were rented out and the lower utility costs are offsetting part of the slightly higher rent. The units are vastly improved yet the overall living costs remain affordable due to halved energy bills as well as low materials costs, which were kept low because during renovations, Ginkgo salvaged and reused as much material as possible from the old units.

After calculating the costs of purchasing the units and renovating them, Ginkgo turns a sizable profit through rentals, proving that it is possible to deliver economic, environmental, and social benefits through its real estate projects.

As of July 2013, approximately 90 percent of the units were rented out, and many of the former occupants remain. The tenants range from older, low-income residents to Duke students, all of whom benefit from the improved aesthetics and affordable rent.

Yorktown Club: After (photo credit: Ginkgo Residential) 

The Dilemma: Balancing Environment and Profit

While meeting all of a project’s goals are challenging, Payne said seeing the impact that Ginkgo’s work has on people makes it worthwhile. For example, one resident, who had lived at the property for over 10 years, started to cry when she walked into her newly renovated apartment. Thanking Payne, she said, “I never thought I would be able to afford to live in a place this nice again."

Seeing the results of Ginkgo’s projects, it may look easy to make money while making people happy and taking care of the planet. However, upon talking to Payne, it becomes clear this is not the case. It’s hard work, and in a sense, Payne is stuck between two worlds, striving to please environmentalists and investors alike. Despite occasional criticisms, Payne remains dedicated, enthusiastic, and inspirational. He believes that the environmental movement may be the greatest story ever told and is doing his best to play a serious role in communicating the message. Regardless of the challenges, Payne will continue to be an advocate for the environment, both personally and through his business, proving himself to be a true resource for Charlotte. 

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Switchboard is the staff blog of the Natural Resources Defense Council, the nation’s most effective environmental group. For more about our work, including in-depth policy documents, action alerts and ways you can contribute, visit NRDC.org.

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