At a time when the nation is facing an affordability crisis, a growing number of financing vehicles are balancing profit and social good to help owners and developers acquire and preserve needed housing, according to a new report by the ULI Terwilliger Center for Housing and NeighborWorks America. 

The Preserving Multifamily Workforce and Affordable Housing: New Approaches for Investing in a Vital National Asset report looks at 16 leading efforts across the nation. So far, collectively they have raised more than $2 billion and helped to acquire, rehab, and develop almost 60,000 units of affordable and workforce housing.

In addition, these vehicles are delivering significant cash-on-cash returns—from 6% to 12%—to their equity investors, which is above and beyond returns from other social investment areas, says report author Stockton Williams, executive director of the ULI Terwilliger Center for Housing.

“One of the reasons we thought it was timely to do the report was the fact that there are now a significant and growing number of these investment vehicles that are focused on preserving affordable and workforce housing. We have heard consistently from many that they believe there is a lot of untapped potential in the conventional affordable housing capital markets and in some of the nontraditional markets,” says Williams. “Hopefully this report not only serves as a resource for developers and owners who are actively working to acquire and preserve affordable and workforce housing but acts as a guide for socially motivated institutions that are looking to invest capital in activities with a social and financial return.”

The investment vehicles featured in the report include:

  • Below-market debt funds: These funds are established through private, public, and philanthropic partnerships to provide low-cost loans and include the Bay Area Transit-Oriented Affordable Housing Fund in San Francisco; the Denver Regional Transit-Oriented Development Fund; the New Generation Fund in Los Angeles; and the New York City Acquisition Fund.
  • Private equity vehicles: These entities, including Avanath Capital Management, the Enterprise Multifamily Opportunity Fund, the PNC Affordable Rental Housing Preservation Fund 1, the Rose Affordable Housing Preservation Fund, the Turner Multifamily Impact Fund, and the Urban Strategy America Fund, use private capital to acquire and rehab affordable and workforce housing properties.
  • Real estate investment trusts (REITs): The REITS, including Community Development Trust and Housing Partnership Equity Trust, allow small-scale investors to invest in income-producing real estate, namely affordable housing.

Four additional innovative efforts that are emerging and featured in the report are the Develop Michigan Initiative, the Greater Minnesota Housing Fund Workforce Housing 2.0 Pilot, the Healthy Neighborhoods Equity Fund, and the Seattle Futures Fund.
“These 16 are by no means the only ones out there that blend social purpose with financial returns,” Williams adds.

Going forward, he says there are two things that come through in the report. One is to raise broader awareness for social investors about the opportunities in workforce and affordable housing through vehicles like the ones mentioned in the report.

Second, Williams adds there’s an opportunity to educate Community Reinvestment Act regulators, many whom have been reluctant to award full credit to banks for investment activities in unsubsidized housing, that the stock has similar populations of subsidized housing.

To view the report in its entirety, visit