The number of people experiencing homelessness grew by 12 percent in 2023—but Rosanne Haggerty, president and CEO of Community Solutions, a nonprofit recognized for developing innovative solutions to end homelessness, says homelessness is a solvable problem. Haggerty believes that real estate professionals are uniquely positioned to get everyone working toward the same goal of providing basic housing and infrastructure for unhoused people. Haggerty’s organization is taking advantage of increased awareness of the problem by partnering with corporations, banking institutions, government agencies, and philanthropists to help shelter unhoused people.
Housing programs that work
Community Solutions is a D.C.-based nonprofit founded in New York in 2011. The organization, which began as a housing developer, now works with communities throughout the country to help solve homelessness. “A key is having a very accurate and timely understanding of homelessness as an indicator as to how the housing system is working,” Haggerty says.
Her program operates in several large cities, working with social impact investors and government and community partners to acquire existing properties. When multifamily buildings come on the market, Community Solutions buys them; then, when units naturally turn over, the organization preserves some as permanently affordable. According to Haggerty, the goal is to fill Community Solutions buildings with 50 percent workforce housing and 50 percent housing for those who have experienced homelessness.
“I think in the first 14 months or so we’ve acquired more than one thousand units in six cities,” Haggerty says. The organization operates nimbly by not relying solely on low-income housing tax credits (LIHTC) or government subsidies.
Joy Horak-Brown has been working on affordable housing since 1996 as president and CEO of Houston-based New Hope Housing. New Hope finds housing for individuals and families who have been on the street for a year or more or who have cycled in and out of homelessness. The nonprofit has more than 1,000 units of available housing for single individuals who are at high risk of becoming unhoused, and 187 one-, two-, and three-bedroom apartments for families experiencing homelessness.
“It’s a complex societal problem, so the solutions are correspondingly complex and varied, as they should be,” Horak-Brown says. New Hope has 11 housing locations with 2 under construction for delivery in 2025.
Easing the transition into secure housing for unhoused people is a vital step in addressing homelessness. Lotus Campaign, an innovative nonprofit startup in Charlotte, works as a bridge between nonprofits that identify those at risk of homelessness and landlords with available units. The organization’s landlord
participation program provides economic incentives to housing providers, cutting through some of the traditional barriers—including spotty housing history or bad credit—to renting that unhoused or at-risk individuals face.
Beth Silverman, executive director of Lotus Campaign, celebrated the organization’s fifth anniversary in July 2023. Although the nonprofit is relatively new, its multipronged approach to mitigating homelessness in Charlotte has made a tangible impact. In addition to connecting nonprofits to landlords, Lotus Campaign is involved in the acquisition of existing buildings. It reserves some units for individuals and families at risk of becoming unhoused. The nonprofit’s first acquisition, in partnership with Jonathan Rose Companies, was a multifamily building with 144 units, 20 percent of which are reserved for Lotus Campaign clients.
Ground zero
Homelessness is a national problem, but the issue has hit some states significantly harder. In California, the crisis is so acute that, in her 2022 inaugural address, the newly elected mayor of Los Angeles declared a state of emergency over homelessness.
Los Angeles–based SDS Capital Group recognized a need for housing solutions and created a supportive housing fund in late 2019 with about $20 million—which has grown close to $200 million in four years. Deborah La Franchi, founder and CEO of SDS, says 60 percent of the fund’s capital is invested in 11 projects with a planned 835 supportive housing units reserved for formerly unhoused people.
Providing housing for formerly unhoused people, particularly in California and New York, is a priority for Bank of America’s community development banking team and its clients according to Maria Barry, the lender’s national executive for community banking. Bank of America provides construction financing and invests in low-income housing tax credits for its affordable housing developer clients.
Barry’s team also connects clients to partners that provide support for residents. Barry says that, since 2020, Bank of America has helped create more than 3,500 units that are allocated for unhoused people. “Of these 90-plus projects with units dedicated to the formerly homeless,” she says, “nearly 30 deals had a majority of units (51 percent-plus) reserved for the formerly homeless.”
Bank of America helped finance a partnership between The Community Builders, a national developer of supportive housing, and the Pine Street Inn, a Boston-based nonprofit that offers services to unhoused individuals, to redevelop a Pine Street–owned property in Boston’s Jamaica Plain neighborhood. The development, which began accepting tenant applications in December 2023, will provide 202 units of income-restricted housing for low- and moderate-income households, with nearly 75 percent of the units providing permanent supportive housing for individuals exiting homelessness.
Funding fundamentals
Horak-Brown is frank about the barriers to building and subsidizing units for unhoused people in the for-profit real estate sector. “The funding is always a challenge.” she says, “There’s no question about that.” While creating supportive housing is a philanthropic goal for some developers, according to the New Hope Housing CEO, “You just can’t make money doing it.”
New Hope Housing uses the federal Low-Income Housing Tax Credit (LIHTC) program to create affordable housing. The organization takes advantage of the program’s 9 percent credits and its 4 percent bond side, in addition to seeking funding from Federal Home Loan Banks.
Only recently, the program increased its credit availability, which Horak-Brown calls “enormous.” She says the increase speaks to Washington’s recognition that homelessness is a major societal problem threatening other economies.
Meanwhile, Community Solutions’ Rosanne Haggerty says she’s noticed more groups tapping into the Inflation Reduction Act as a resource to help solve homelessness. Some industry experts say the federal initiative allows real estate developers to partner with city leaders to construct new buildings that are healthier and more affordable.
Despite government help, Horak-Brown says, some experts agree that government funding and charitable foundation funding are not going to be enough: “The extra piece that I think makes it all possible is private funding. Private philanthropy is key to building the quality housing that is going to last,” she explains, adding that there are longstanding land use–restriction agreements in federally funded housing.
La Franchi, addressing homelessness in California, says the problem with public-sector money is that most of the permanent supportive housing developments in Los Angeles County have anywhere from 5 to 12 funding sources. “Each one of them is very complicated to access and has a lengthy application, review and negotiation process that can take years to cobble together,” she says, adding that while funding is being sorted out, building costs can go up.
SDS’s supportive housing fund is all private capital, consisting of funding from banks, corporations, foundations, and endowments. Less restrictive funding has allowed SDS to use the capital nimbly, says La Franchi. “We can literally close on the transaction in three weeks if we need to. SDS provides up to 97 percent of all the construction and land cost, so we go very high up the capital stack.”
La Franchi projects that the fund will finance more than 2,000 units in California. “Four of our projects will have tenants moving into them in 2024, so our projects are starting to come off the assembly line, so to speak,” she says.
SDS supports only one developer with its $190 million fund: Los Angeles–based RMG Housing, which has come up with a cost-effective development model, according to La Franchi. Instead of reinventing the wheel for every project, RMG uses the same format for each of its developments. As a result, the developer can build units for less than $250,000. That’s far less than the $600,000 to $800,000 it typically costs to build supportive units, La Franchi says. “We’re using private sector money and using a model that’s much more efficient.”
Silverman says that, although the private sector has not historically driven the development of supportive housing, private capital allows for agility and comes with a focus on innovation that can drive scale. Lotus Campaign takes no government funding, and Silverman says that philanthropic dollars are competitive.
In 2023, JPMorgan Chase financed the acquisition, conversion, and operation of a hotel on Manhattan’s Lower East Side into a 120-bed “safe haven” and medical clinic. The bank noted that its Community Development Banking team worked with its Public Finance Housing and Public Finance Debt Capital Markets teams to design a financing solution that could be used as a template for future projects.
“While capital is often readily available to help construct or rehabilitate buildings, service funding and local operating programs can sometimes be delayed, causing providers to use existing funds or lines of credit to bridge the timing payments,” says David Walsh, managing director of Community Development Real Estate East Region at JPMorgan Chase. Walsh adds that connectivity with diverse funders becomes even more important in these instances.
Haggerty says Community Solutions has been able to tap into an array of private capital, including from health care companies, foundations, and other corporate interests that are committed to addressing homelessness.
Partnerships as models
Partnerships can make a difference in efforts to solve homelessness. Lotus Campaign’s housing and services model brings together the for-profit and nonprofit sectors to create the most impact.
“Once you have a few partners, it’s easy to get more people on board,” says Silverman. Optimism is important, she says, as is “getting people to be part of a problem to solve something that seems unsolvable.” To that end, Lotus Campaign partners with innovative organizations delivering social services and trauma care to help ensure its clients don’t end up homeless again. She calls these partnerships “neighborhoods of opportunity.”
Horak-Brown of New Hope Housing says partnering with hospitals and education systems is key in helping to solve homelessness. Housing is a social determinant of health, she says, stating that diverting dollars from the health care system for housing makes sense.
“Thinking about housing as a societal necessity rather than a privilege and the impacts [housing] costs have on our health care and education systems is key,” she says. New Hope has a health clinic in one of its buildings. Another houses Bezos Academy, a preschool fully funded by Amazon founder Jeff Bezos. Horak-Brown says these partnerships are testaments to New Hope’s belief in the integral relationship between housing, health care, and education.
Silverman has paid attention to data suggesting individuals living in neighborhoods with high-quality amenities are more likely to experience upward mobility. Part of Lotus Group’s model is to partner with housing providers that have properties and units in mixed-income and market-rate communities. Lotus hopes to break the cycle of homelessness by housing individuals in communities with access to high-quality amenities, facilitating long-term support through collaborations with social service partners.
Community Solutions’ Built for Zero campaign is active in about 100 cities nationwide that are working to end homelessness through a data-driven approach. Haggerty says that to address homelessness, organizations need to understand why people are becoming homeless and examine where the gaps are. She emphasizes that in a supportive housing environment, property managers should take an interest in their tenants’ wellbeing and engage in any challenges they may be facing.
According to La Franchi, SDS’s developments also provide risk management and counseling on-site: “We provide tenants with the outreach assistance they need to help put them on a path to personal sustainability.”
Changing the lens
Silverman says that homelessness is a multifaceted problem compounded by rising costs in the real estate sector. Industry leaders agree that dwindling affordable housing is putting people at risk of not having a place to live, and Silverman says the narrative that homelessness is driven by such factors as drug abuse distracts from the affordability issue. Housing precarity is on the rise, she says, and “even experiencing one night without housing is a traumatic event.”
Haggerty thinks rising awareness has had a galvanizing effect in real estate and development circles, with more organizations than ever stepping forward to help. “You can look at the situation of housing the homeless as a crisis,” she says, “or you can look at it and say, ‘we’re all on the same page now and we really need to lean into this issue.’”
Capital is not a primary barrier, she adds. “More money is needed, I guess, but to say if it weren’t for money we could solve this isn’t necessarily true. You just have to get creative.”
