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Green Building News

Energy-Efficient Building for Everyone

An Arizona builder provides affordable houses and high-end model homes with the same energy-efficiency features

This $750,000 home in Glendale, Arizona, was built by Mandalay Homes. It was a 2015 winner of a Housing Innovation Award from the U.S. Department of Energy. Mandalay Homes includes the same energy features in its entry-level houses as it includes in this more expensive home.
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This $750,000 home in Glendale, Arizona, was built by Mandalay Homes. It was a 2015 winner of a Housing Innovation Award from the U.S. Department of Energy. Mandalay Homes includes the same energy features in its entry-level houses as it includes in this more expensive home. A Mandalay Homes project under construction. The Arizona-based builder specializes in high-performance houses. Mandalay is adopting advanced framing techniques, which reduce the amount of lumber and thermal bridging in the building envelope, and Huber's Zip System sheathing for better air sealing.
Image Credit: All photos by Mandalay Homes
Mandalay uses open-cell spray polyurethane foam in stud cavities on exterior walls and on the underside of roof sheathing for its thermal and air-sealing properties. But health and safety concerns are prompting the company to consider a switch to blown-in fiberglass insulation instead. A high-efficiency gas furnace is placed in the attic space before the underside of the roof deck is insulated. All ducts are located within the thermal boundary of the house. Domestic hot water is provided by a tankless gas-fired heater. The interior of this year's winning entry has more expensive finishes, flooring, and cabinets than affordable projects that Mandalay Homes has built, but the energy efficiency features are the same.

Arizona builder Mandalay Homes hopes to build 120 houses next year, increasing by one-third the number of completions in 2015. No matter what the price tag, every one of them will get exactly the same energy-efficiency features.

For the third year in a row, the builder picked up a Housing Innovation Award from the Department of Energy, this year sharing “grand winner” status with KB Home of Los Angeles in the competition’s production housing category. Last year, Mandalay won an Innovation Award for a development of 100 DOE Zero Energy Ready homes, and the year before that it was recognized for an affordable housing project of 14 houses.

After turning to high-performance construction just a few years ago, Mandalay says that it is now capable of building a house twice as efficient as a standard new home for $4 or less extra per square foot. Every house the company builds will have a HERS index of 50 or less.

“It’s a cornerstone of our business model,” says Mandalay construction manager Geoff Ferrell. “We build a lot of places. The home that won the award is a $750,000 house in an upscale neighborhood, but we also build in some more rural areas where we’re building smaller homes, not quite as tricked out as that one, starting in the mid-$200,000s. As far as performance and energy efficiency we put all of the exact same components in. We use all the same techniques, all the same materials, and we guarantee that all of our homes are going to come in under 50 HERS, regardless of the price point or there they’re being built.”

Building to DOE Zero Energy Ready specs

Mandalay has projects underway in two two climate zones, 2B and 4. Winters are balmy by New England or Minnesota standards, but an average summer in Phoenix would quickly wear most people out. (Every single day this past August, for example, the high temperature topped 100°F, reaching 117°F on August 14.) Rainfall averages about 8 inches a year.

Among requirements for meeting the DOE Zero Energy Ready standard, houses must be certified to Energy Star 3.0, have a building envelope that meets or exceeds requirements of the 2012 International Energy Conservation Code, have all ducts inside the thermal boundary, and meet certain provisions of the EPA WaterSense program.

Mandalay does it with 2×6 exterior walls framed on 16-inch centers and insulated with 3 1/2 inches of open-cell spray polyurethane foam, R-4 of continuous rigid foam on the exterior, and a sealed attic with R-31 of open-cell foam applied to the bottom of the roof deck. According to a DOE description of the project, houses are built on post-tensioned concrete slabs insulated with R-8 of vertical rigid foam on the perimeter but nothing underneath.

Airtightness in this year’s award winning home was 1.66 air changes per hour at a pressure difference of 50 pascals. Other features include tankless water heaters, high-efficiency gas furnaces with 15 SEER air-conditioning coils, energy-recovery ventilators, double-pane windows with a solar heat gain coefficient of 0.22, drought-tolerant plantings with drip irrigation, LED lighting, and a photovoltaic system rated at 8,000 watts. Like all of its houses, this one is prewired for a 240-volt electric vehicle charger.

Its HERS index was -2.

Working with subs to improve efficiency

The company built 90 homes this year and had sales of between $55 million and $60 million. It hopes to build 120 houses next year, and it’s had to work hard with its subcontractors to meet its efficiency and production goals.

When Mandalay began building high-performance housing three years ago, it quickly realized that air-sealing the building envelopes would be key. Ferrell said that the company went to one framing sub and asked if he could help meet Mandalay’s airtightness goals — and promptly got turned down. The framer said no, Ferrell called, because he didn’t trust his crews to do it. Mandalay went to its painting subcontractor instead, who was more than happy to seal around pipes and wires, and at top and bottom plates.

“A painter doesn’t seem like a natural trade for that, but we went to the trade that was willing to do it, and paid them for it. We got them interested in what we were doing,” Ferrell said. “By working with the trades and getting them invested in our goals, and making them feel a part of that process, it makes it a lot easier.

“If you go to a trade and say, ‘I need you to do this,’ they’re going to fight you every time. You’re never going to get what you want.”

Later, the framer who had originally declined the extra work came back and said he’d changed his mind. “We had to say: No, sorry, you missed the boat,” Ferrell said. But, he added, the company can’t afford to “shove a trade aside.” In some towns where Mandalay is building there aren’t a lot of subcontractors to choose from, so the idea is to build good relations and work hard to get them interested in what you’re doing.

What the buyers want

The awards must look great on the walls at Mandalay headquarters, but Ferrell concedes that most home buyers don’t come in the door asking about a HERS rating or what blower-door tests are showing.

“Most buyers don’t care how much insulation is in the wall, or that open-cell spray foam gives them superior air-sealing over batts,” he said. “You know, they don’t care. They want the benefit of it. They want lower energy bills, and fewer allergies over the course of the year. That’s what they’re interested in.”

There have been more prospective buyers who have heard of the awards the company has won. Yet the company is in a highly competitive business where buyers are often willing to spend more on granite counters or travertine tile but still pinch their pennies on high-performance features like PV systems.

“There is a small minority of buyers that say they want to spend $15,000 on a photovoltaic system. Yes, we have those buyers,” Ferrell said. “But by and large, they’re buying for the community, they’re buying for the floor plan, they’re buying for the features and finishes they’re going to live with.

“The balancing act we play is we have to build a beautiful home, a home that fits in the marketplace for the area we live in, that’s attractive to the buyers we’re trying to attract, and do all those energy things we’re committed to doing.”


  1. exeric | | #1

    In Arizona, no less
    This is great to read about. Perhaps word of mouth from happy owners will spread the word to other prospective builders and buyers of homes there.

  2. Expert Member
    Dana Dorsett | | #2

    They claim that's already happening.

    The sidebar on p.4 reads:

    “The best measure of results is the home
    owner testimonials we receive on a
    regular basis, touting their low energy
    bills and their enjoyment of their home.
    What better way to spread the word
    about healthy, energy-efficient living than
    through happy, satisfied customers!”
    — Geoff Ferrell

  3. Andrew_C | | #3

    In Arizona - that was my first thought.
    Hopefully they can continue to expand in Arizona down as far as Tucson. I remember reading the Peter L. (illustrated) horror stories, and walking thru construction in Tucson I've seen similar things. The sales people that I spoke with know only surface finishes and square feet, nothing about construction or performance. If Mandalay Homes can put pressure on other builders by building HERS 50 houses as a basis, I'd be really happy.

  4. exeric | | #4

    An interesting quote
    In the link Dana provided is another interesting quote: "For Mandalay Homes, the path toward energy efficiency may have started as a city contract requirement, but said Ferrell, “now we do it for the fun of it.""

    I think that points up an important principle about market forces and how completely unguided loose markets really aren't effective, at least in the beginning. Mandalay seems o have been required to meet a certain standard by a city contract. In other words, that city government made an external request, outside of simple market forces, that the housing meet a certain energy efficiency requirement.

    It may perhaps evolve that no external requirements by any outside government will be needed to continue good building practices. Once the public expects a certain minimal level of comfort and efficiency then markets there act effectively. I think exactly this point is where strict libertarians go astray. Markets don't always evolve in a healthy or efficient way without outside guidance from government. At least in the beginning.

  5. jackofalltrades777 | | #5

    There is hope...
    Maybe it was my blog and the GBA story that helped a builder move in the right direction? Either way, I am glad to see a major builder take initiative and build a better home in Arizona. We've seen the abysmal Phoenix building examples that GBA displayed and these new homes are a giant step in the right direction.

  6. JC72 | | #6

    Nice read.
    @ Eric Habegger,

    Remember governments create distortions in markets, so it could be argued in this case that the City Contract Requirement was a distortion in response to another gov't distortion (i.e. pricing of power, taxpayer subsidies for PV arrays.)

  7. exeric | | #7

    Don't think so, Chris M
    The example of shoddy construction by some builders going on in Phoenix as described by Peter L in earlier posts doesn't seem to me to have had anything to do with government intervention. I think you are stretching facts to justify a belief of yours that government is the source of all market problems. Did you even read that series of comments way back when? It didn't seem to this reader to have anything to do with the government pricing of power or taxpayer subsidies for PV arrays.

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