Affordable public housing made available through P3s
by Mary Scott Nabers,
CEO of Strategic Partnerships, Inc.
The question of how to fund affordable public housing continues to plague city officials throughout the nation. However, an attractive solution is emerging – public-private partnerships (P3s).
P3 initiatives come in various sizes and shapes and they are attractive for many reasons. Private sector firms willing to invest capital in large public initiatives and wait years for a return on investment have become “saviors” to public officials. Most governmental entities have exhausted other funding options.
The beneficiaries of the P3s are senior citizens, students, teachers and first responders who need to live downtown.
Examples of recent P3 low-income housing projects include:
- Enterprise Community Partners and Waypoint Homes teamed on a $20 million affordable housing project in Oakland, California. The project involved purchasing, renovating and then renting approximately 100 homes in two inner-city neighborhoods. In this partnership engagement, Waypoint Homes agreed to renovate and manage the properties and Enterprise Community Partners agreed to provide financial education and workforce development to the tenants. The rent-to-own program, which brings private capital to low-income neighborhoods, is generating revenue for investors while revitalizing downtrodden neighborhoods. Residents, public officials and private sector firms all benefit.
- Earlier this month in Cambridge, Massachusetts, Caritas Communities Inc. celebrated the completion of a $10 million project to renovate 128 units of affordable housing. Funding was provided through private equity, public lending and tax-exempt bond financing from MassDevelopment. The partnership provided much-needed renovation while preserving the affordable housing benefits to the citizens of Cambridge.
- The Housing Authority of Santa Clara County (HACSC) recently announced the reopening of the Cypress Gardens senior citizen housing facility in San Jose, California. This project was made possible through a very creative public-private partnership. One of the oldest affordable public housing facilities for senior citizens in the county was renovated after years of neglect and deferred maintenance. HACSC leveraged $90 million in private funds from Low Income Housing Tax Credits, tax exempt bonds and commercial loans to accomplish the renovation.
- The BPC Housing Commission and the Jack Kemp Foundation recently hosted a housing forum in St. Louis to discuss the importance of public-private partnerships in addressing the nation’s housing challenges. This marked the third of four regional forums on the subject. Public officials and local housing experts spoke about the need for public-private partnerships in the housing market. A key takeaway from the forum was the ability for P3s to transform blighted areas into thriving communities. The last of these regional housing forums will be held on July 25 in Bar Harbor, Maine.
- Officials in Fort Worth recently celebrated the reopening of the renovated Wind River Apartments, a previously rundown complex of 168 units. The apartments were transformed into quality dwellings by the Fort Worth Housing Authority through a P3 engagement. Cost of the project was approximately $14 million.
The trend to use P3s is growing and although the selection process is laborious and slow, the marketplace is churning with opportunities.