This year’s AHF 50 developers started construction on more than 43,000 affordable housing units in 2021.
It’s a big number in any year but even more so coming during a time of a global pandemic, rising development costs, and other mounting challenges. The number of units started is about a 3.2% increase over last year’s group, which broke ground on 41,754 affordable units in 2020.
Dominium, a Plymouth, Minnesota-based firm that has consistently ranked near the top of the AHF 50, heads this year’s list after beginning construction on 12 projects with 3,046 units in 2021. The company recently opened offices or established a physical presence in Atlanta, Dallas, and Phoenix.
With the company’s growth moving from the Southeast to the southern Rocky Mountains in recent years, the team wanted to become fully part of the communities, says Paul Sween, senior managing partner.
“It makes a real difference in both our ability to understand the markets that we are serving and also to be accepted within those markets,” he says.
The AHF 50 developers list is based on the number of new affordable units that the firms started construction on in 2021. The information is gathered through surveys submitted by the firms.
Overall, 108 firms took part in this year’s survey, with almost 41% saying finance conditions for affordable housing will be worse by the end of the year.
The overwhelming concern is rising development costs trailed by supply chain disruptions and the rising cost and availability of debt. This is a change from a year ago when COVID-19 impacts and higher development costs were the top concerns followed by the reduction of state and local resources.
Sween is also watching rising interest rates, which would put even more pressure on deals this year. As a result, Dominium is looking at its pipeline of projects to evaluate potential interest rate exposure.
In other moves, the firm continues to refine its standard design for buildings, with regional-specific modifications. It’s also launched an internship program, providing a first paid work experience for its young residents.
Affordable Housing Finance also presents its AHF 50 owners list as well as the top 10 companies completing acquisitions and completing substantial rehabilitations last year.
The AHF 50 owners list continues to be led by The Michaels Organization, which has just over 47,000 affordable units in its portfolio. Fast-growing Starwood Capital moved up a spot to No. 2 this year, with 42,434 units.
This year’s AHF 50 owners hold nearly 802,000 affordable units in 7,724 developments across the country. This list is determined by the number of affordable units owned as a general partner as of Jan. 1.
