We are in the midst of an affordable housing crisis in the United States. There is a shortage of housing available for working-class and low-income families and that is driving up rent prices and property prices – putting home ownership out of reach due to the inability of these families to save.
As investors and real estate developers, it’s our job to create. We create opportunities, communities, and can turn a tract of land into a profitable enterprise. Naturally, we are drawn to developing and investing in projects that will yield a healthy ROI. It helps fund other projects and keep us doing what we love.
When it comes to developing affordable housing, the issue is simple – the ROI just isn’t there.
Why?
- The cost of construction is soaring.
- Communities are creating more and more zoning regulations that are frankly not worth the hassle of trying to get around.
- It’s difficult to find affordable labor for projects.
At CGI, we are committed to working on this problem. In fact, we allocate a percentage of units for affordable housing, and we have a team dedicated to assisting applicants in getting approved and acclimated within the community.
But, we need more to create more. Our CEO, Gidi Cohen, had this to say about the issue:
“Create a financing structure that allows developers to build a workforce and low-income housing within urban living components, while still making the development successful and profitable. Once we have that background and incentives, I would pivot from Class A housing and build more affordable housing.”
As real estate developers and investors, we need less red tape when it comes to zoning. We need more tax credits. We need policies that help reduce the cost of construction.
If we all work together as a country, we believe the affordable housing crisis can be reversed and home ownership can become a reality to the hard-working families who are striving to achieve the American dream.
