A building is not just a shell but a complex system, a controlled environment which is affected by climatic factors such as temperature, heat, light, air movement, humidity etc. And how you deal with all these factors affects the energy consumption, durability and comfort within. The first step towards energy efficient building design lies in climate design. Building designs sensitive to climate around them perform well with regards to energy. The natural elements such as sunlight, solar heat, wind etc when interact with the building in a desired way reduce the use of other forms of energy for creating the desired thermal comfort levels within the building. This study aims to investigate all the factors which usually affect the energy efficiency of a multi-family residential scheme such as the climate, geometry, orientation, proximity of structures to each other, their shading qualities, planning of internal spaces etc with regards to the climate it is being built in. The project will particularly focus on design and development of 12 residential units as a part of a multi-family residential development in hot and arid climatic zone and devise strategies to optimize their energy efficiency. The investigation will be furthered by use of computer simulation software to optimize the thermal performance of the cluster as a whole and the comparative results will be later verified to draw out conclusions regarding the effectiveness of these strategies.