Standard Communities, a national developer of affordable housing, entered the Colorado market through a $1B portfolio acquisition spanning 6,000 apartment units across four states, the company said Wednesday.
The Colorado segment of the portfolio could serve a role in addressing the state’s housing affordability crisis, adding lower-cost apartments and preserving affordability through partnerships with the state government and local housing authorities.
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The 60-community portfolio houses more than 13,000 residents and creates a significant footprint in two other states new to the company, Arizona and Texas. The purchase also grows the firm's California presence to about 11,000 homes, Standard said in a press release. The company’s national portfolio now includes close to 27,000 apartment units housing about 60,000 residents.
The state-by-state unit count in the portfolio wasn't disclosed.
Building the portfolio involved the Department of Housing and Urban Development, Fannie Mae and Freddie Mac, state governments and local housing authorities, according to Standard.
“We took control of these properties by acquiring general and limited partnership interests, including controlling interests of managed tax credit funds with institutional investors,” Chris Cruz, Standard senior managing director of essential housing, said in the release. “We navigated new financing facilities, tax credit investor partners, nonprofit partners, ground lease buyouts and loan assumptions with numerous governmental and private lenders simultaneously on a fixed timeline.”
Standard said it plans $30M in capital improvements and maintenance across the portfolio, aiming to enhance housing quality without displacing residents, a population consisting primarily of families and senior citizens.
Providing attainable housing in Colorado’s increasingly expensive residential market is a challenge that has vexed government and community leaders across the state. Colorado and Denver use a carrot-and-stick approach to encourage developers to include affordable housing in multifamily builds.
New residential developments in Denver with 10 or more units are required to have as much as 12% of units designated as affordable, or developers can pay a six-figure fee as an alternative. The state offers tax credits to developers who build affordable housing.
Affordable housing is a major component of the Kroenke Sports & Entertainment Ball Arena redevelopment plan. The city is pouring millions into renovating existing housing and converting unused office space into residential units.
Office conversions could be part of a $570M plan to reactivate parts of downtown approved by voters in this week’s election. But Denver voters in the same election appear to have shot down a sales tax increase championed by Mayor Mike Johnston that would have raised about $100M each year for tens of thousands of affordable housing units.
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