Another leading affordable housing developer and owner has entered the build-to-rent (BTR) market. Lincoln Avenue Communities (LAC), based in Santa Monica, California, has broken ground on The Ranches at Gunsmoke Apartments, which will offer 271 units for individuals and families earning up to 60% of the area median income (AMI) in Maricopa, Arizona.
“We kept hearing from working families that they wanted the space and privacy of a house but couldn’t afford to buy—or didn’t want the maintenance. BTR lets us give them that ‘single-family feel’ at affordable rents,” says LAC vice president and project partner Ben Taylor. “Additionally, because BTR taps the single-family construction supply chain, we can build these homes for about 10% less per unit than a traditional garden-style apartment. So, it checked both boxes: better product for residents and solid economics for us.”
The Ranches at Gunsmoke Apartments is LAC’s first build-to-rent development, comprising two- and three-bedroom duplexes and standalone homes, with each unit featuring a patio, private fenced backyards, and walk-in closets. Residents also will have access to a fitness center, a pool, grilling areas, a clubhouse, and rental storage units. In addition, a solar array will be installed on carports to offset about half of the community’s electricity usage.
“We’re excited to see this new community taking shape thanks to LAC,” states Maricopa mayor Nancy Smith. “This new development addresses the needs of those who work in the city of Maricopa, whether they’re hourly workers, teachers, new police officers, or even our retired senior citizens who want to be a part of a community in which they don’t have to take care of the property itself.”
The $115 million development, which is about $420,000 per home, was financed with back-to-back construction and permanent loans from Citi Community Capital, $65 million in tax-exempt bonds issued by the Arizona Development Authority, and $49 million in low-income housing tax credits and solar equity from WNC.
LAC is building on the momentum from this first project. It has two more planned in Phoenix’s West Valley and will be moving dirt this year on an affordable BTR community in Columbus, Ohio. It also is lining up sites in Texas and the Washington, D.C., metro. Longer term, according to Taylor, it would like to bring the model to Colorado and Nevada—“any market where families are getting priced out of homeownership.”
“Affordable BTR fills the gap between an apartment and owning a house. Families get a front door, a yard, and elbow room—without taking on a 30-year mortgage,” adds Taylor. “That stability means kids can stay in the same school and parents can put down roots, which you don’t always see in traditional apartments.”
Dominium, another prominent affordable housing developer, entered the BTR market and is also working on a project in Maricopa. The firm recently broke ground on the 215-unit Saddleback Village at Stonegate, which will feature two-, three-, and four-bedroom homes for households earning 60% or less of the AMI.
