NeighborWorks Network Exceeds 90,000 Affordable Rental Units
Rental units owned or managed by the NeighborWorks America network exceeded 90,000 as of the end of September, and the network invested more than $1.3 billion in rental housing during the fiscal year.
By Jeffrey Steele, Contributing Writer
Washington, D.C.—Rental units owned or managed by the NeighborWorks America network exceeded 90,000 as of the end of September, and during the fiscal year ending September 30th, the network invested more than $1.3 billion in rental housing.
Those were among milestones announced last week by NeighborWorks America, one of the United States’ largest sources of community development capital. NeighborWorks has about 235 organizations in its network, 150 of them being owners and/or managers of affordable rental housing. Last year, these owners and/or managers preserved or created about 10,000 units of affordable rental housing, with new housing comprising about 3,000 of those units.
The rental portfolio of 90,000 units has grown 50 percent since 2007, and is expected to surpass 120,000 units by 2016.
“We do a variety of things,” Tom Deyo, deputy director, national initiatives for the Washington, D.C.-based organization, tells MHN. “We provide organizational capital to develop real estate. Other investment comes in financing or equity. We offer partners capital to help them run their real estate operations and invest into their properties. They may use our capital to renovate existing properties, or help provide gap financing when doing an acquisition or development.”
NeighborWorks provides skill-level training to the real estate staffs within its organizations, focusing efforts on their development teams to help make them stronger developers and improve their development acumen, Deyo says.
The organization also expends effort on the property management side, to help ensure communities in its network are well regarded and emphasize resident service. That way, “residents can find homebuyer counseling, financial literacy programs, preschool care and, in senior units, some senior services,” he says.
NeighborWorks also works in the asset management arena, investing resources in helping make its non-profit developers stronger asset managers.
The NeighborWorks Training Institute offers courses in asset management. The courses are open not just to NeighborWorks organizations, but to anyone who wants to learn to manage assets more effectively, says NeighborWorks spokesman Douglas Robinson.
All of these services are very attractive to the strong affordable housing developers that NeighborWorks America seeks to bring into its network. “We do recruit the high-performing developers,” Deyo says.
Cities and towns around the country are increasingly grasping the value of adding and preserving affordable rental housing. But that doesn’t mean there aren’t considerable challenges in developing affordable housing, Deyo says. Among the most vexing is finding the right structure and the right site, he notes.
“You have a very tight rental market,” he observes. “People are either delaying their home buying, uncertain, or incapable of buying. Rental vacancies are down and rents are up, and that puts a further strain on our market . . . The financing is more of a struggle, with the debt market being tighter.”
One trend that is very positive is the move toward greater energy efficiency among network members, Deyo says. He remembers when perhaps a third of new units coming online were energy efficient, but today, it’s 65 or 70 percent.
Says Deyo: “We’ve been promoting energy efficiency, because it helps owners’ bottom lines, and makes their communities more attractive to residents—and residents’ budgets.”
