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‘The Landscape Has Changed’: Pioneering Affordable Housing Broker Welcomes New Competition


Squeezed between high housing costs that put ownership out of reach and a shortage of affordable housing that limits the availability of rentable units, about half of Americans say a lack of affordable housing is a major problem where they live.

Finding housing solutions has become a high priority for elected officials, advocacy groups and, increasingly, the business community. Commercial real estate investors, developers and brokers who at one time might have concentrated exclusively on market-rate housing have taken notice, particularly after the problem intensified during the pandemic.

Broker Kyle Shoemaker, who founded Affordable Housing Investment Brokerage Inc. 10 years ago, is pleased the issue is getting the attention it deserves, particularly from the broader CRE community. He said that wasn’t always the case.

When he entered CRE as a young broker working for a multifamily investment sales team in Chicago, most of the attention was on market-rate housing. But occasionally, Shoemaker had the opportunity to work on deals with an affordable housing element, a niche that intrigued him.

“I wanted to truly provide value to clients and potential clients,” he said. “I quickly realized that even very good multifamily brokers did not have a great understanding of these complicated assets.”

Shoemaker said the affordable sector appealed to both his business instincts and social conscience.

“I was fascinated by the business from a mission perspective — it was something I could feel good about contributing to,” he said. “I wanted to combine creativity and deal-making to help solve an issue that will make society better.”

Shoemaker founded AHIB to focus on direct, confidential sales of properties overseen by the Internal Revenue Service’s Low-Income Housing Tax Credit program as well as Housing Assistance Payment contract properties, known as "project-based Section 8." In the past decade, Shoemaker and his team have overseen deals worth more than $3B.

At the same time, more competitors have entered the affordable housing market, which Shoemaker sees as a positive trend. 

“The landscape has changed and several good, thoughtful competitors have emerged, which I think helps elevate everybody’s level of service and gives clients options,” he said. 

Most of the newer entrants to the market are either brokers who have paired with lenders or lenders that have created brokerage teams. This means AHIB is a bit of a niche business within a niche market. 

“I'm one of the very few that is not specifically tied to any lending source, which I see as advantageous,” he said. “Our competitors might nudge clients to a debt provider that's associated with their business.”

Shoemaker acknowledged that the one-stop shop approach of many firms has its appeal. But he said AHIB’s independence from any one lender gives him — and his property owner clients — an advantage.

“I can work with different debt providers based on the needs of a given deal or client, and I prefer to maintain that flexibility,” he says. “On the other hand, I don't want somebody who's buying a property from me and has a great relationship with a given debt provider to feel they're being forced into using somebody affiliated with me.”

The bottom line, he said, is that firms like AHIB provide a long-overdue service.

“Even in very good economic times, there's not enough housing for the people who need it,” Shoemaker said. “And if times are bad, when a lot of people are losing their jobs, that need increases. I saw that happen in 2008 and 2009 and then again in the pandemic in 2020.”

Even more so than the Great Recession, the pandemic and its aftershocks had a profound impact on the affordable housing market. It highlighted the need for more housing and drew new players into the space. 

“That was probably the biggest escalation I ever saw of professional multifamily investors who may have always been focused on market-rate deals, but who were now saying they wanted to get into the affordable housing space,” Shoemaker said.

In discussions about affordable housing, the emphasis is often on building new homes. But Shoemaker said it is equally important to preserve the existing stock of quality housing. 

“By helping to create an efficient marketplace, AHIB can reach buyers who are innovative and creative enough to pay the best price on the market to get what the seller wants, and preserve that housing,” he said. 

As more multifamily players enter the affordable housing space, Shoemaker said it is important that they support the Low-Income Housing Tax Credit. 

This federal program funnels billions of dollars to state and local governments to support the acquisition, rehabilitation or new construction of rental housing targeted to lower-income households. Although it has been described as “the most important resource for creating affordable housing in the United States,” there have also been calls for repeal of the tax credit.  

“I tell multifamily investors that they should be proactively supporting the low-income housing tax credit because it is a job creator and one of the best tools we have to create housing,” Shoemaker said. “We need to maintain this tool because it's the right thing to do as a society but it protects their investments as well.”

This article was produced in collaboration between Affordable Housing Investment Brokerage Inc. and Studio B. Bisnow news staff was not involved in the production of this content.

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