As construction has slowed in Massachusetts and developers say it is too hard to build in the state, investors are beginning to turn their attention to cities and towns just over the border in New Hampshire. 

Middleton-based developer The Procopio Cos. is preparing to start construction on a 310-unit build-to-rent project in Londonderry, New Hampshire — just 40 miles north of Boston on I-93. CEO Michael Procopio told Bisnow it has lined up a construction loan with Rockland Trust and an equity partnership with an institutional investor, California-based The Resmark Cos. 

He said this type of partnership wouldn’t have been possible in Massachusetts, as institutional investors are shying away from the state, and it shows how investors are flocking to places where the cost of doing business is lower, like southern New Hampshire.

"Developers and capital are going to go where there's less resistance," Procopio said. "They're going to go where they can deploy their dollars efficiently, get a reasonable return and meet the market. And that's the thing: Massachusetts stands in the way of us being able to meet the market with all the regulatory hurdles."

The prospect of Massachusetts potentially instituting rent control — a ballot initiative was struck down by the courts but could return in the coming years — has exacerbated the concern that investors have with building in the regulation-heavy state. 

Southern New Hampshire has benefited from its proximity to Greater Boston, creating demand for apartments and drawing the attention of institutional investors looking to deploy capital in the region, several industry executives told Bisnow. 

"In the last seven years, we've definitely seen the interest in New Hampshire commercial real estate increase from investors outside of the Greater New England area, and certainly coming up from Boston," said Colliers Managing Director Bob Rohrer, who oversees the brokerage's New Hampshire office.

California investor Passco Cos., which is active in 18 states and has $4.6B in assets under management, entered the New Hampshire market in February 2025, acquiring 3 Lexington Court in Merrimack for $87M. In March 2026, the investment firm acquired the Novella at Tuscan Village multifamily property in Salem for $125M.

The firm doesn't hold any properties in Massachusetts, with the two New Hampshire deals representing its first in the Northeast.

Passco Chief Investment Officer Colin Gillis told Bisnow the deals were attractive given their proximity to the Greater Boston area, without being tied to the same regulatory burdens and underwriting uncertainty that come with doing business in Massachusetts.

"This is a chance for us to essentially buy in the Boston MSA in a state with no sales tax, no state income tax, and be within the economic sphere of Boston and not necessarily deal with any of the regulatory risks that come with the state of Massachusetts," Gillis said.

In June, Lawrence-based Arrowpoint Properties acquired an 85-unit building in Bedford, New Hampshire, for $25M. The deal was one of the firm's first purchases in the state, besides a short-lived multifamily deal more than a decade ago.

"A lot of businesses seem to be actually leaving Massachusetts and going to New Hampshire," Arrowpoint CEO David Lamattina said. "That's always a good sign, and you know, typically they tend to bring their employees with them, and that means more housing needs and things like that."

Rohrer also said he has been having more conversations with outside business owners, including from Massachusetts, looking to move their companies across state lines, citing more favorable tax structures and business-friendly attitudes on the local level.

"There's cooperation and desire for business success in New Hampshire, and so that's kind of a cultural thing that I think starts in Concord with the governor and works all the way through not only the political side but also the business side," Rohrer said.

Companies moving to New Hampshire create demand for more housing, and the southern part of the state also draws demand from people who work in Massachusetts. Some choose to commute down from New Hampshire due to its lower cost of living, especially as post-pandemic workplace policies have reduced the number of days many need to be in the office. 

This has led to an uptick in new development activity in recent years, predominantly along Interstate 93, which allows for a direct connection to Boston. Developers have been drawn to cities like Salem, Manchester and Londonderry, and even coastal cities such as Portsmouth.

New Hampshire cities and towns issued building permits for 5,822 housing units in 2024, the highest total since 2005. 

More than 4,000 new multifamily units delivered last year, Colliers said in its second-quarter report on the New Hampshire multifamily market, calling it “the largest wave of new supply in years.”

This supply has been largely absorbed, the report found, with New Hampshire’s apartment occupancy as of Q2 sitting at 95.4%. And it found that apartment asking rents increased 1.1% year-over-year to an average of $2,292 per month. 

These strong fundamentals have drawn more big investors to the state. 

In October 2025, Virginia-based Harbor Group International acquired 1 Newcastle Drive in Nashua for $250M, and in January, Boston-based TA Realty acquired the Siena Tuscan Village property for $137M.

Procopio said developers and investors have been drawn to New Hampshire because its entitlement process is far shorter, without the regulatory steps like Massachusetts' environmental review process, and it doesn’t have the looming threat of rent control.

Rent control had been slated to come up for a vote on Massachusetts’ ballot in November, but the initiative was thrown out in June when a judge ruled it was unconstitutional. Procopio said most outside investors stopped looking at the state when the rent control initiative was on the ballot, and most of them still haven’t returned since the decision. 

"Now that rent control has been, quote-unquote, put to bed, at least temporarily, I think people are assuming that they all came back into the market," Procopio said. "The reality is like 20% or 30% of them came back in."

Additionally, the New Hampshire legislature has made it easier to develop housing across the state. House Bill 631, which took effect on July 1, allows multifamily development to be built in commercial zones by right. In 2025, several other housing laws went into effect, making the permitting process for new housing faster and allowing accessory dwelling units by right.

Boston-based Jones Street Investment Partners completed a 250-unit building at 75 Canal in Manchester in 2024. Jones Street Chief Investment Officer Matt Ranalli said the firm has been active in the market since 2014 and believes investor interest will only continue to grow.

"Our decision to develop 75 Canal was driven by those strong market fundamentals and the opportunity to deliver a purpose-built multifamily community in a market historically dominated by converted mill buildings," Ranalli said in a statement. "The property has performed well and reinforced our view that demand for high-quality multifamily housing in Southern New Hampshire remains strong, and we expect investor interest in the region to continue growing."

On top of Procopio's Londonderry BTR deal, Rockland Trust this month closed on its first low-income housing tax credit deal in the area. The $9.4M deal was for the 36-unit redevelopment of the Hallsville School in Manchester.

The lender said it sees a great need for more housing at all income levels as the population grows.

"Across Southern New Hampshire, communities are facing an urgent need for affordable and workforce housing," Rockland Trust Senior Vice President Kelly Nguyen said in a statement. "Rockland Trust is proud to support projects like this and remains committed to bringing more LIHTC financing opportunities to Southern New Hampshire to help create housing that strengthens communities and expands access for residents."

Procopio said that though Massachusetts officials have been trying to spur housing development through policies like the MBTA Communities law and providing funding for new projects, underlying issues will continue to dampen investment unless more policies change. 

"Nobody wants to pull the levers, and what we've seen is in states like Florida and Texas and North Carolina and New Hampshire, Maine, they are willing to pull the levers to drive housing production," Procopio said. "And they're going to eat Massachusetts' lunch."