A vacant hotel is being transformed into a 303-unit workforce housing development in downtown Baltimore with the help of a key Opportunity Zone (OZ) investment.
Arctaris Impact Investors has committed $30 million through its OZ strategy to the project, which aims to provide naturally affordable housing for households earning up to 80% of the area median income.

“It’s very challenging to build new housing across the country, and that’s largely a function of the fact that apartment valuations are down about 20% and costs are pretty much the same if not higher coming out of COVID,” says Andrew Gibbs, principal of Arctaris. “It’s very tough to make the numbers work to build new ground-up construction without a whole lot of government subsidy.”
The Baltimore project was an opportunity to acquire a former hotel that closed during the pandemic, according to Gibbs, noting that property was initially built as apartments in the 1960s, so they are larger units with kitchens.
The development is led by GoodHomes, a New York City-based firm that specializes in distressed hotel-to-workforce housing conversion projects.
“We’re able to add new naturally affordable housing supply in a market that desperately needs more housing options for about 25% of what it would cost to build new,” Gibbs tells Affordable Housing Finance.
The development is notable because it embraces the idea of repurposing a property “that had run out of its use” and turning into a new residential community, says Nihar Sait, managing director at Arctaris, adding that the firm is also exploring office-to-residential opportunities.
A Boston-based national impact investment firm, Arctaris is providing a combination of equity and debt, according to officials.
This investment was made in partnership and partially through a multimillion-dollar commitment from Erie Insurance (ERIE). Based in Erie, Pennsylvania, ERIE invested in the GoodHomes project as part of a $20.5 million social impact commitment to fund companies and development projects in underserved communities within the company’s footprint.
The GoodHomes Baltimore project is being developed as Maryland begins to relocate thousands of state workers to the city’s central business district to help address vacancies and stimulate the local economy.
The development team is in the process of taking care of deferred maintenance at the building and will be seeking permits for the conversion of the hotel rooms to multifamily housing. It is also hoping to receive property tax abatements from the city.
According to Sait, the Baltimore project illustrates the work of OZs as well as Arctaris to bring capital into areas in need of investment.
Created under the Tax Cuts and Jobs Act of 2017, the OZ program is an economic development tool that seeks to boost investment in distressed communities by providing tax benefits to investors. As key program deadlines approach in 2026, recent legislation has sought to extend the incentive for another two years.