By Mark English, E&A Team Inc. Every short-term decision contributes to a long-term goal. In multifamily housing construction, the consequences of short-term decisions are particularly evident when an owner hires an architect, contractor or a superintendent who lacks a full understanding of accessibility compliance. It all comes down to two key questions: What regulations apply to the property, and what are the technical standards each regulation requires you to apply? The answers to these questions determine the applicable accessibility requirements for the property. In 2007, I was shocked to learn …
Industry Voices
The Trump administration has reshaped global trade dynamics with sweeping tariffs targeting imports from Canada, Mexico and China. As the CEO of a firm that provides capital to experienced CRE professionals including dozens of multifamily housing developers, and who has also owned and/or managed over 4,700 affordable housing units, I see these policies as a watershed moment for the U.S. housing market. The confluence of 25 percent tariffs on steel and aluminum imports, effective March 12, the potential for 25 percent duties on Canadian and Mexican goods and 10 percent …
Any number of issues can keep multifamily developers and owners awake at night. I’ve identified the following four top problem areas for developers when it comes to billing and compliance based on my experience working on new construction projects. The following tips can help minimize unnecessary delays, reduce staff frustration, avoid fines and lower costs all while allowing for a smooth transition into operations. 1. Deposits Setting up deposits for multifamily developments is a challenge that requires careful attention to details such as regulatory compliance, financial management and tenant relations. …
Increasing the supply of affordable housing is critical to addressing the severe housing crisis the United States faces. However, many investors think the returns on affordable housing are not sufficient to merit the time and expense of development. New multifamily residential projects of all types are more expensive than ever, thanks to recent inflation and high interest rates, and in the affordable segment, balancing cost with quality livable design has never been more complex. With rent and income restrictions, affordable projects require a mindset beyond counting pennies to make the …
The past few years have brought significant shifts in affordability in the United States. Whether it’s evident in rising grocery bills or adjustments to what qualifies as a necessity, these changes have rippled through the housing sector. According to data from the U.S. Census Bureau, by 2024, the cost-of-living ratio to overall expenses surpassed 31 percent — the highest since 2014. Historically, a housing burden ratio below 30 percent indicates a stable market. However, the increasing costs of housing — including rent, mortgages, taxes, utilities and insurance — are straining …
Low Cost of Living, New Affordable Housing Legislation Lure Renters and Developers to Hollywood, Florida
The city of Hollywood, Florida, is transforming. Once best known for its pristine beaches and as the winter home to many French Canadians, the area is becoming a magnet for new arrivals from the Northeast, Texas and California seeking a better place to live and do business. Hollywood’s mayor and city commissioners are showing their support for multifamily development, which will result in half a dozen projects being completed in 2025. Why are people choosing Hollywood and not Fort Lauderdale or well-known Miami neighborhoods like Brickell and Wynwood? Because the …
As a young lawyer, I passed up an opportunity to work at the SEC (think Bernie Madoff not Nick Saban). I turned the job down because I didn’t want to spend all day thinking about fraud. I’m glad I turned down that job, but I find I still spend a lot of time thinking about fraud. If fraud is using deceit to deprive another of their rights or property, then fraud is everywhere. Some fraud is horrible (Bernie Madoff stole roughly $65 billion over the course of two decades). Some …
Today, the inverted yield curve has created challenges for borrowers to secure debt. The curve describes the condition when long-term U.S. Treasury debt interest rates are less than short-term interest rates. This is particularly evident in the cost of capital for construction loans. Despite these challenges, sophisticated and experienced affordable housing debt providers are finding creative solutions to meet borrower needs. In particular, borrowers are taking advantage of the lower-cost option of tax-exempt bonds, primarily funded by institutional municipal capital providers instead of only looking to commercial banks. Balancing Taxable …
Most people who have studied real estate investing will recall that property expenses are divided into controllable and noncontrollable buckets. In the noncontrollable bin are items like insurance, utilities and property taxes. And while it is true that these expenses usually are unavoidable, an owner should try to exert some level of control, at least in the case of taxes. Taxing entities calculate property taxes by multiplying a property’s assessment by its jurisdiction’s tax rate. The rate is indeed noncontrollable, but savvy owners will review their assessments and challenge them …
All the talk in multifamily circles in 2023 and throughout 2024 has been about the impending “maturity wall” of loans set to expire. This wall, many have said, would stir up a wave of distress that would create “generational buying opportunities” from the fallout of the overleveraged, floating-rate acquisitions and new developments delivered at the top of the market. How has that played out? Buying opportunities haven’t yet materialized, and the multifamily investment sales market remains flatlined. How can that be given the record number of trades at the top …