Affordable and workforce housing are among the most stable asset classes in real estate



ImpactAlpha, January 29 – With long waiting lists, low vacancy rates and stable tenants, affordable housing is a low-risk, long-term investment. Big, corporate-backed affordable housing funds are grabbing headlines (see, “The key to new $500 million affordable housing fund? A $40 million grant from Facebook’s founder”). But lower-profile partnerships, funds, and deals have grabbed more capital in total in the first 30-days of 2019. Here’s some of the recent dealflow in affordable housing:

  • Preservation. in New York’s South Bronx, NCV Capital Partners, Mount Hope Housing Co., Lemor Development Group, and the Community Preservation Corp. are pouring $100 million into preserving 515 units of affordable housing… Virginia-based real estate firm Middleburg has reached the first close on a planned $75 million fund to acquire, rehab and manage distressed workforce housing in the U.S. Southeast and Mid-Atlantic… Goldman Sachs’ Social Impact Fund committed $15 million to a new fund by New Jersey Community Capital build, acquire and rehab low-cost housing in New Jersey.
  • Housing as healthcare. Non-profit healthcare giant Kaiser Permanente and Enterprise Community Partners formed a $100 million loan fund to build and preserve low-income rental housing as a way to improving community health across Kaiser’s eight-state (plus D.C.) network area. Separately, the first investment from Kaiser’s $200 million Thriving Communities Fund is a 41-unit complex in Oakland, Calif…. And again separately, Enterprise launched a five-year, $250 million initiative to foster greater integration between health and affordable housing.
  • Global challenge. French public finance institution Caisse des Dépôts has raised a whopping €900 million ($1 billion) from 15 institutional investors towards a planned €2 billion fund to build middle-income housing in Paris and other French cities… CBRE Global Investors has raised £250 million ($329 million) towards its U.K. Affordable Housing Fund, with backing from 13 investors including Big Society Capital. The fund will invest in social and affordable rental housing, worker housing and homeless hostels across the U.K… Also in the U.K., Cheyne Capital is backing a £40 million project to build 379 new affordable housing units on a restored brownfield site in Stoke-on-Trent in northwest England… The Social Impact Investing Initiative of the U.N.’s Office for Project Services (UNOPS) is partnering with the Kenyan government to corral private capital to develop 100,000 new affordable homes across the country.

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