Good morning, everyone. It is my great pleasure to be here with you talking about the challenges we are facing in prioritizing health and the design and develop an of Affordable Housing. Here to my left, the partner and owner of blue seed development, and has a lot to do with the video you just saw, which is pretty amazing. Yes, thank you. [applause] is bob simpson, Affordable Housing at fannie mae. Thank you, bob. Bob and i also it is of south dakota, the thing we found before this panel. Most likely we are the only 2 from south dakota. Just a little factoid for you. We will start with les, who is a housing developer. You have been at the forefront of linking health and housing for some time and it is a unique topic for the subject matter of this summit. Can you talk about how you got involved in this work and why it is important to you . May be about 10 years ago, we had been developing energyefficient homes, sustainable green buildings, under the program, and my partner and i decided we wanted to ratchet it up a little bit and go for the highest achievement, and when we got to the section about Indoor Air Quality, you look at it and you go, jesus, you think any of this stuff really works . It was pretty detailed. We didnt really know. It seemed like it made good sense. We asked them outside a school of medicine if they would be interested in doing a study, because we couldnt find any data that says Indoor Air Quality effects peoples outcomes. He jumped at the opportunity. The building we were building was in the south bronx and it had the highest hospitalization rate in the country. They did it. Fastforward, the study went of ash, the incidents much up, in some cases zero, two years after the study finished. We said, well, we can do this. Even better, we didnt waste money trying to do it. We went to the next step, which the activetime, Design Guidelines, and again, it was about changing peoples outcomes through the environment. It sounds,just as getting people active. We incorporated that into one of our buildings. Lisa terrific. The property in the video is yours. Can you talk about how you are able to include these amenities and Affordable Housing . It is a challenge. There are first costs. I think the Biggest Challenges we face are sustaining it. We are fortunate in that we are the developers, the builders, and the property managers. There is synergy there, cost savings there that we can put into the project. And i think that while we dont have a mission statement, we are the appreciative of all people that work with us of gete we are, so when you into this business, you very quickly look at the property cycle and the effects it has and the benefits of having good housing that bring to that continuum. Lisa terrific. I guess i would ask why you think more Housing Developers are not making this a priority, and what we can do to generate more activity. Les well, i think that is changing. First costs are always an issue. In Affordable Housing, you are always between a rock and a hard place. But i think that is changing. What were amenities now are becoming kind of standard fare for most developers. The government certainly has a role in raising the bar and requirements of its developers. And i think most developers dont want to be left in the dust, so when they see one doing it, they dont want to be the guy that is left out. Lisa sure, sure. Your ownout to little bit from bob, but what role can the financial industry play in serving this as well . Les dollars are everything. Everything we can do to support the development, and really the sustainability of it. A lot of what we do requires education not only for people who are building the building, but the occupants afterwards. We can put in all these great facilities, but if there isnt a mechanism to get them, train them and educate them about this, it was maybe wasted. Whatever the Financial Community can do to help further those efforts would be great. Lisa terrific. Is there a story you can tell maybe it is another reallife resident story about the creative ways you have been able to drive results in this area . Les well, we one of the things that people like to point out in the study and otherwise encouragetrying to physical activity through active Design Guidelines can we try to encourage stair use. Whether you have everything else, you have stairs. Try to make the stairs less scary and easier to use. And we also it came out that we slowed down the elevators. That all of a sudden created an impetus for people to want to use the stairs. [laughter] les and in fact come in the last study, that building we did, mount sinai did a study of obesity in that building, and they found that stair use went s bmisand the people over two years stay the same. Lisa i would absolutely call that creative. [laughter] lisa bob, lets turn things over to you the next few minutes. I would love to hear about the work you are doing with the development of the fannie mae healthy Home Financing program. Mae provides financing across the country for affordable multifamily properties in all 50 states. We have been doing this for over 25 years and literally financed thousands and thousands of properties. What we found in seeing developments that folks like les have been doing and other borrowers is, number one, there is a clear connection between where you live and your health outcome. You think about it, at the end of the day from everybody goes home. If you are growing up in a low income family, your spending a significant amount of time there. It is a great opportunity to find ways in which we can improve health outcomes. We fully believe that your zip code should not predetermine your health. What we are trying to do is develop a way in which we can reward and incent borrowers like les who are investing in the health of their tenants. A couple use ago we developed a program for Green Financing. At the time nothing like this existed, where we provide financial incentives to borrowers if they commit to energy improvements. We started with one and eventually grew to 300 million in annual business. We were 300 million of business in a 300 million industry. That was it. Billion, but, 3. 5 the industry have caught on and taken on our standards and dated 7 billion worth of business. This year we expect the number to grow exponentially. We expect to do the same thing for borrowers like les who are investing in Healthy Homes and outcomes for their kids. We are just about ready to put out the first of what we hope will be several product initiatives that will provide a financial incentive for borrowers who commit to making the same healthy improvements at properties as what you just saw in the video today. The goal is to make sure that this is a oneoff deal. Les this is not a oneoff deal. Les talks about the Creative Things they do and it is hard. We want to standardize it and make sure that what you see becomes commonplace five or 10 years from now. [applause] thats fantastic, and i think it is important that we think about ways to make this beyond just a oneoff activity. I have heard this sort of referred to as the next green movement, if you will. I would love to hear from you on that and what it is that fannie mae saw in terms of the opportunities here and the potential here to really drive impact. Bob well, 2 things. Number one, there is a tremendous opportunity we are on average have about 20 of the market for affordable multifamily properties and commercial multifamily rental properties as a whole. So while we dont control the market, we do have the ability to set standards, and we have the scale to make it work on a national level. We think that with that comes a responsibility to make sure that when we are providing financing, were doing it in a responsible manner. We have also found, frankly, that properties perform better when the residents are healthy, and when the neighborhood is healthy, and the best way in which you can contribute to a strong and vibrant neighborhood is to make sure that the people who are living in the properties you are financing are strong and healthy as well, not just from a health perspective, but from a Financial Stability perspective. The success we had in the Green Financing business was a nice model, and if we can provide an incentive and reward borrowers who invest in making physical improvements at the property, we ought to be able to do the same thing for borrowers who make investments in the physical health of their tenants. Lisa sure. So if we were to look out five years from now, with the efforts we are doing today and hopefully more, what will be the impact on the industry as a whole . Well, number one can i would hope we are not the only ones in the space. I would like to think there is a level of standardization, so when you want to define what constitutes a healthy apartment unit, there is a common set of standards that we can all agree to. That is important, because it allows the program to be standardized across a number of different financial partners. We dont want to be the only person in this space i would hope after five years that we are not even the leader. It would be nice for there to be healthy competition in this space. Lisa think the best job of a leader is to outgrow your own job, outgrow the need for your job. Bob when my kid gets out of college [laughter] lisa i feel the same. This question now is for both of you. This question is for both of you. That individuals and institutions can do to support these efforts Going Forward . We will start with les. Les institutions are catching on. I was just reading the paper yesterday that the state of california is now setting aside 90 million of its medicaid funds to subsidize housing. And why . Because they found out what we all know. [applause] les its great. Theres a famous architect, william mcdonough, who says if we were so smart, why did it take 6000 years to put wheels on our luggage . It is common sense, but it took us this long to get to it. So they are catching on. Theres a hospital in chicago that did the same thing. T 250,000 of their own funds to use as Emergency Rooms for clinics. Like anything, keep up the focus, keep up the results. The evidencebased data is huge. To thewould say that folks in this room, its really to understand and be sure to keep that health and housing are interconnected. Issues we faced in the Housing Industries are very much related to whats going on in the world of health. For every person who is fortunate enough to live in one they arebuildings, getting achievement this environment in which they can raise their family and give their kids an opportunity to grow. The fact of the matter is for every one person who is fortunate enough to be in one of les buildings, there are three or four folks who dont have that opportunity. Their 8. 1 million americans that are paying more than 50 of their income for rent today. Is extremely hard to make healthy decisions for your family if you have to choose between paying rent and buying groceries. So its not just making sure that their Healthy Buildings there are Healthy Buildings and services that promote health and the properties. Thats absolutely important. We need to provide enough sousing supply to house folk who dont make enough money. [applause] les i agree. In the video, it referenced the number of of applications. Between the two phases, there were 93,000 applications between two and 49 events of housing. Events of49 housing. Lisa in the last minute for the panel, what does success look like . If you could write the headline of the story that is to be times, whatnew york does that look like . Bob more buildings like les does. Les i will go one step further. Sustainability is about the people. We tend to focus on the buildings, but its really about the people and theres no reason for us to get together every year. Lisa terrific. Thank you so much. Lets give around of applause for bob and les. Thank you so much. [applause]