To create rental homes that can remain affordable for the long term, developers typically need to assemble layers of low cost, flexible debt and equity. These scarce funds are often administered through lengthy competitive processes or are subject to annual allocations. Providing flexible enterprise capital can help support multi-step development strategies, however those resources are scarce and don’t address all barriers.
By partnering with local land banks, local government can help developers secure land, limiting exposure to cost increases while financing is assembled. This strategy can be particularly effective where a comprehensive development is planned and can be even more powerful when paired with local funding that can support completion of demolition and site preparation work during the hold period.