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Downtown luxury apartment buildings have taken a beating from the coronavirus pandemic this year, but middle-class and workforce housing in the suburbs has fared better, and CRG, the development arm of Chicago-based Clayco, said now is the time to launch a major effort in workforce housing.
The firm plans to develop $1B of apartments in nearly a dozen metro areas, CRG Managing Partner J.J. Smith told Crain's Chicago Business.
The Sun Belt will figure heavily in CRG’s plans. CRG will look at potential projects, each with several hundred units, in the Atlanta, Austin, Charlotte, Dallas, Nashville and Phoenix regions, among others, he said.
The apartments will have rents affordable to those earning between 80% to 120% of area median income. Experts say less expensive suburban developments have generally kept their occupancy rates higher than luxury buildings in dense urban cores as more tenants look for less-crowded homes.
"What we're trying to do is build for the masses and not the classes," Smith told Crain's.
CRG brought Smith on board to run its residential division in March. He had spent more than a decade at CA Ventures, where he became president of CA Student Living and helped launch more than 40,000 units of housing.
Smith said many developers spent the past 10 years building luxury skyscrapers that most people can't afford, and that market might be oversaturated.
"I think the middle class has largely been underserved from a new product perspective," he said. "We'll do well serving that segment."
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