As the coronavirus storm clouds began to gather in March, CRG Managing Partner J.J. Smith was hired to help run the firm’s residential sector. In the first few weeks, he concentrated on developing a plan that leaned heavily on urban infill projects in high-density markets, the profitable strategy pursued by so many builders in the last decade. But after watching downtowns turn into ghost towns, Smith decided on another approach.
“I called it the pandemic pivot,” he said.
Dense urban cores now cause unease among many affluent renters, Smith noted, and even if vaccines tamp down the coronavirus pandemic, developers need a new product type that investors find appealing. When he ran the numbers, the answer seemed logical.
Middle-class and workforce housing fared better during the 2020 downturn, especially in the suburbs, with rents and occupancy staying near pre-pandemic levels, Smith said. CRG, the real estate development arm of Chicago-based Clayco, took that data and in November…
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