After investing $1.3 billion into rental housing in the fiscal year ending on Sept. 30, 2011, NeighborWorks America, one of the country's largest network providers of affordable housing and community development training, expects more growth this year.
And since it is a renters market, “through a combination of new member affiliation, purchase and new construction,” executives said, the network's total portfolio is expected to increase to 100,000 rental homes in 2013. (The total value of the rental portfolio cannot be calculated given price per unit differences in different states.)
Due to the foreclosure crisis, which continues to bring more renters into the marketplace, the number of rental homes owned or managed by the NeighborWorks network has grown. It exceeded 90,000 at Sept. 30.
According to the network's CEO Eileen Fitzgerald it has not been easy to secure resources for affordable rental housing, it is “one of the toughest markets” to secure capital and build partnerships.
In total NeighborWorks members invested in the construction of over 2,800 new apartments, in the process generating new, local jobs.
In addition to Community Housing Capital, Decatur, GA, and NeighborWorks Capital, Silver Spring, MD --the two main corporations associated with NeighborWorks builders and owners-- social investors Calvert Foundation and the S.H Cowell Foundation also have joined the network's efforts to develop affordable rental housing.
In the last five years, NeighborWorks organizations generated over $19.5 billion in reinvestments but executives recognize that going forward “the outlook for the broader affordable rental housing is uncertain.”
Challenges in attracting new social investor capital include reduced resources available to government entities, higher cost of capital and tight underwriting standards.
Fitzgerald finds the competition for capital priced at rates that make housing accessible for working families, improved from a year ago, but “still a factor” in the affordable rental housing market.
