An Architecture Firm’s Push To Build Net-Zero Apartments—On A Budget
Share Button

An Architecture Firm’s Push To Build Net-Zero Apartments—On A Budget

Philadelphia’s Onion Flats is constructing low-cost buildings that use design, mechanical equipment and residents’ behaviour to slash fossil fuel consumption.

By RUSSELL GOLD
Thu, Feb 11, 2021 3:52amGrey Clock 4 min

The shiny, onyx-coloured building appears alien in its drab, postindustrial Philadelphia neighbourhood—the love child of a “D-volt battery and the Death Star,” as one local architecture critic put it, admiringly.

Called Front Flats, the four-story building is wrapped on all sides and roof by 492 translucent, double-sided solar panels. The building is airtight and extraordinarily energy-efficient, its developers say.

By driving down consumption and producing electricity from its solar panels, Front Flats is designed to generate its own power. But this isn’t a corporate headquarters where executives can spend lavishly on a showcase edifice. It is 28 apartments, built on a budget for renters who make below the area’s median income. One-bedroom apartments rent for under $1,400, less than the $1,750 average for the neighbourhood, according to rental-listings website Zumper.

Onion Flats, the Philadelphia-based architecture-and-building firm behind Front Flats, is at the forefront of designing low-cost buildings that use design, mechanical equipment and residents’ behaviour to slash fossil fuel consumption.

“As an architect, if I’m not designing buildings that contribute no carbon to the environment then I’m being totally irresponsible,” says Tim McDonald, 56, a principal in Onion Flats. “I might as well be designing buildings that sit on marshmallows.”

Buildings contribute 38% of global greenhouse-gas emissions, including heating, cooling and construction materials, according to the International Energy Agency. The building industry is growing more interested in low-carbon construction, but few architects or contractors have experience with it. Many believe it significantly raises costs. Onion Flats wants to demonstrate that it can be done affordably and at scale, prodding others to follow and policymakers to enact energy-efficient building codes.

Mark Lyles, a project manager at the New Buildings Institute, a nonprofit based in Portland, Ore., that promotes low-carbon construction, says the work by Onion Flats is noteworthy because it ties together on-site renewable energy generation with “deep efficiency.”

Mr McDonald and his partners, he says, are “always asking where can I reduce energy consumption. A lot of his projects are bellwethers for where things are going.”

Onion Flats is one of several firms trying to build very energy-efficient housing. In Manhattan’s East Harlem neighbourhood, a 709-unit affordable housing development called Sendero Verde is under construction; it is intended to be among the most energy-efficient multifamily buildings in the world. In Portland, Ore., a 10-story, 127-apartment retirement community is slated to start construction this spring, and is expected to use up to 60% less energy than a typical multiunit building.

Onion Flats is a family affair. Two of Mr McDonald’s brothers, Patrick and Johnny, are also principals, as is Howard Steinberg, a friend since seventh grade in suburban Philadelphia.

Front Flats is its most ambitious attempt at a “net zero” building—a structure that throughout a year generates as much energy as it consumes. The solar skin—which is 60cm away from the windows and exterior—generates electricity, keeps the building cool in the summer by blocking the sun, and provides privacy to tenants. “You can’t see into people’s apartments, but they can see you,” Mr McDonald says.

The building, which opened in January 2020, doesn’t have a natural gas line and uses electricity for heat and hot water. From January through June, it generated more electricity than it needed and sold the excess onto the local power grid, Mr McDonald says. In July, August and September, it drew more kilowatt-hours than it generated. Overall, it is still ahead, Mr McDonald says, but since the pandemic slowed leasing and the building wasn’t fully occupied until the fall, the true test of whether the building is net zero will come this year with apartments full of people charging their mobile phones and playing on game consoles.

The firm has built several residential buildings in Philadelphia over the years and plans to keep going. The principals have learned that actual energy consumption is often greater than what the models predict. The culprit is “plug load”; people plug in bigger televisions and more electricity gobbling devices than expected.

About a mile south of Front Flats, Onion Flats built another apartment building called the Battery which attempts to tackle this problem. LEDs on the outside of the Battery are connected to particular apartments, although which light connects to which isn’t obvious to passersby or residents. When an apartment is using less electricity than its share of what is being generated, it glows green; otherwise, it glows red. The system, after encountering a software problem, is expected to go online this year.

After building its first government-subsidized, ultra energy-efficient townhouse for low-income residents in 2012, Onion Flats lobbied the Pennsylvania Housing Finance Authority, a state agency that distributes federal low-income tax credits, to consider an energy efficiency standard known as “passive house” construction when determining which builders were awarded the coveted credits. “We said ‘If we can do this, why can’t other developers’?” says Mr McDonald. After one meeting, the state agreed to give developers extra consideration for using a passive house design, beginning in 2015. (Onion Flats didn’t use the credit for Front Flats.)

The passive house projects didn’t cost much more to build than traditional apartment buildings—despite costing considerably less to heat and cool, according to an analysis of construction costs for residential projects over the past five years that the authority performed at the request of The Wall Street Journal.

“Not only is that encouraging, but the end result should be lower utility costs for the life of these passive house apartment buildings,” Robin Wiessmann, executive director of the agency, said in a statement. Tenants at Front Flats pay US$40 a month for utilities. Fifteen states are copying Pennsylvania’s approach and have begun using incentives to encourage more super-efficient apartment buildings.

Mr McDonald says he hopes that buildings that generate their own electricity will become commonplace.

“People don’t say, ‘I want to be known as an architect that has bathrooms in all our buildings.’ No, that’s just a given,” he says. “Being green, being sustainable, being carbon-neutral, should just be what it means to be a good architect.”



MOST POPULAR

Automobili Lamborghini and Babolat have expanded their collaboration with five new colourways for the ultra-exclusive BL.001 racket, limited to just 50 pieces worldwide.

Rugged coastal drives and fireside drams define a slow, indulgent journey through Scotland’s far north.

Related Stories
Property
Wealth on the rise as billionaires reshape Australia’s property landscape
By Staff Writer 23/04/2026
Property
Late Swarovski Billionaire’s Private Island Near Venice, Italy, Asks €24 Million
By Casey Farmer 23/04/2026
Property
INSIDE ONE OF THE WORLD’S MOST EXCLUSIVE POSTCODES
By Jim Motavalli 07/04/2026

Australia’s wealthy class is expanding fast, and Knight Frank says that a surge in billionaires is reshaping the nation’s luxury property market.

By Staff Writer
Thu, Apr 23, 2026 3 min

Australia’s luxury property market is being quietly reshaped by one of the most significant wealth expansions in the world. 

According to Knight Frank’s latest Wealth Report, the country’s billionaire population is set to grow by 77 per cent over the next five years, rising from 48 to 85 individuals. 

That surge sits within a broader wave of wealth creation. Ultra-high-net-worth individuals, those with more than US$30 million, are forecast to increase by nearly 60 per cent to over 26,000 Australians by 2031. 

Globally, the pace is accelerating. The report reveals that 89 new ultra-wealthy individuals are created every day, a figure that underscores a structural shift in capital formation rather than a cyclical upswing. 

For luxury property markets, this is not just a headline number. It is a demand driver. 

Australia’s wealth story is increasingly underpinned by diversification across resources, finance, technology and services, creating a depth of private capital that is both mobile and strategic. 

And mobility is key. The ultra-wealthy are no longer tied to a single market. Instead, they are operating across multiple global hubs, maintaining footholds in cities like London, New York and Singapore, while using Australia as a stable base. 

In this environment, real estate becomes less about shelter and more about positioning. Trophy assets remain desirable, but capital is increasingly being deployed across the full risk spectrum, from long-term holds to value-add opportunities. For Australia, the implications are clear. As wealth expands, so too does the expectation of product, and the locations that can attract it. 

The billionaire effect  

While property remains central to wealth preservation, the latest data shows that capital is increasingly spreading across luxury asset classes, albeit with a more disciplined approach. 

Knight Frank’s Luxury Investment Index recorded a modest 0.4 per cent decline in 2025, signalling a stabilisation phase after several years of correction. 

But beneath that headline number is a more telling shift. Collectors are moving away from speculative buying and toward assets defined by rarity, provenance and cultural significance. 

Impressionist art led the market, rising 13.6 per cent, buoyed by landmark sales including a US$236 million Klimt painting. Watches also performed strongly, up 5.1 per cent, driven by continued demand for brands like Patek Philippe and Rolex. 

At the same time, more volatile categories have corrected. Whisky values fell 10.9 per cent, while parts of the fine wine market have softened following pandemic-era highs. 

Perhaps the most notable trend is behavioural. Younger investors are entering the market through fractional ownership platforms, gaining exposure to high-value assets that were once out of reach. 

For property, the parallels are clear. The same focus on scarcity, narrative and long-term value is increasingly shaping buying decisions at the top end of the residential market. 

Global wealth  

The growth in billionaires is not just increasing demand, it is changing where that demand is directed. 

In Australia, Brisbane has emerged as one of a handful of global cities experiencing rapid change in its luxury positioning. The city’s transformation is being driven by infrastructure investment and the 2032 Olympics, with top-end apartment prices rising from around US$6 million to more than US$10 million in just 12 months. 

Luxury price growth has remained steady, with Brisbane rising 2.1 per cent in 2025, while the Gold Coast recorded 2.8 per cent. 

At the same time, buying power is tightening. US$1 million now buys 5 per cent less in Brisbane than it did five years ago, reflecting the upward pressure on prime markets. 

The trend is not confined to capital cities. Regional lifestyle markets are also capturing attention. Geelong’s waterfront has been identified as one of the world’s hottest luxury residential markets, driven by a combination of coastal amenity, infrastructure and relative value. 

In these markets, pricing is no longer the sole driver. Lifestyle, accessibility and long-term growth are increasingly shaping buyer decisions, particularly among globally mobile wealth. 

Alternative luxury assets  

Beyond residential property, high-net-worth individuals are continuing to diversify into alternative assets that combine lifestyle and investment potential. 

One of the most compelling examples is vineyard investment. Knight Frank’s Global Vineyard Index highlights the Barossa Valley as one of the best-value wine regions globally, where US$1 million can secure more than 18 hectares of land. 

Despite a 10 per cent decline in land values over the past year, the broader outlook remains positive, particularly as the global wine industry shifts toward premiumisation. 

This “trading up” trend is seeing consumers favour higher-quality, provenance-driven wines over mass-market products, reinforcing the long-term appeal of established regions like the Barossa and Eden Valleys. 

For investors, the appeal lies in the intersection of lifestyle and capital preservation. Vineyard assets offer not only production potential, but also a narrative — something increasingly valued in a market where experience and authenticity carry weight.