How Regions Bank uses centralized technology to help affordable housing developers accelerate funding, streamline coordination, and stay on schedule.
Affordable housing real estate developers face no shortages of challenges when it comes to timely and cost-effective completion of projects. Rising construction costs, tariff-driven price volatility, interest rate impacts, supply chain disruption, and labor shortages are among the most critical factors affecting the completion of construction projects today, and all of them largely lie outside a developer’s capacity to control.
That makes controlling the aspects of the process they can control even more critical, and this in large part comes down to creating efficiency.
Realizing Efficiency Through Centralized Access
The potential for delay is inherently baked into any construction project, given the number of stakeholders involved. General contractors, subcontractors, material suppliers, inspectors, and title agents are all essential, but visibility and alignment are critical to ensure processes move smoothly and that the various parties receive timely payment for their services.
“The goal for any developer working through a construction project is to secure funds as quickly as possible to keep things moving forward, but this can become complicated when working with multiple third parties,” says David Payne, head of originations for Regions Affordable Housing. “For developers, working with a bank that leverages technology to automate manual processes and expedite access to capital can provide a significant advantage, and this is an important area of investment for Regions.”
Through Regions’ centralized digital platform, which is powered by Built, affordable housing developers can connect with the bank and critical third parties to view project and loan information in real time, as well as upload invoices and other documents and submit construction draw requests. The Built platform provides instant notifications as events occur throughout the project lifecycle, including when draw requests are funded or inspection reports are uploaded. These combined efficiencies allow for greater accuracy and collaboration to meet construction timelines, manage capital requirements and project expenses, and mitigate fraud risk. Using Built's platform, Regions has reduced draw funding times significantly.
The Value of a Centralized Banking Relationship
Beyond leveraging the capabilities that technology can offer, there’s another important way affordable housing developers can realize valuable efficiencies, according to Payne: working with one bank for the full spectrum of construction project financing needs.
“With an affordable housing development, there can be a lot of components involved from a financing and capital stack perspective. There is real value in working with one single bank that has the capability to coordinate all these capital needs,” he says. “At Regions, our objective is to provide a 360 approach, bringing together our various teams to provide construction debt, permanent debt through our Real Estate Capital Markets agency platform, affordable housing equity generated by the low-income housing tax credit through Regions Affordable Housing and our fund investors, and bond trustee services through our Institutional Services Group to deliver a seamless financing result.
The closing process is another area where the collaboration aspect can also create valuable efficiency for clients.
“The closing process can often involve working with multiple banks, syndicators, agency lenders and bond trustees, all of whom may not be affiliated with each other,” Payne says. “Our 360 approach at Regions connects those dots and provides for a more streamlined process.”
The ultimate takeaway for affordable housing developers, in Payne’s point of view, is that they can simplify and speed up the construction funding process by centralizing and streamlining. “Affordable housing construction projects are complicated enough as they are. Working with experienced banking advisers that can help simplify the process and reduce the administrative load can make a big difference in staying on time and on budget.”