Homeless to Housed: Marrying the Money with the Deal

ULI

On February 25, 2025, during the Urban Land Institute’s Housing Opportunity Conference in Atlanta, Georgia, a pivotal discussion centered on innovative funding solutions to address homelessness. The “Homeless to Housed: Marrying the Money with the Deal” session, moderated by Fulton County Commissioner Dana Barrett, featured key leaders in affordable housing, including Shannon Nazworth, president and CEO of Ability Housing; Joy Horak-Brown, president and CEO of New Hope Housing; and Margot Besnard, an associate on the acquisitions team at Jonathan Rose Companies.

Nazworth highlighted how Ability Housing, which operates across Florida, focuses on creating housing for individuals who earn 60 percent or less of the area median income (AMI), as well as for persons with disabilities. She said, “We create housing that the market won’t or can’t create,” emphasizing the organization’s extensive portfolio, which includes more than 1,700 units intended for formerly homeless individuals. To fund these developments, Ability Housing leverages low-income housing tax credits (LIHTC), state trust funds, local government resources, and impact investments, such as its recent Capital Magnet Fund award of $3.75 million aimed at enhancing affordable housing initiatives in Northeast and Central Florida.

In her address, Nazworth expressed concern about Florida’s rising condo fees, which are increasingly placing seniors at risk of homelessness. She noted Ability Housing’s significant efforts during the Covid pandemic, which included linking housing provisions to employment opportunities as a means for tackling intergenerational poverty.

Horak-Brown, of New Hope Housing in Texas, shared her organization’s critical role in combating homelessness. With a workforce of 135-plus staff members, New Hope operates 15 properties in Houston, offering supportive housing to those who earn 60 percent of AMI or less. Horak-Brown noted, “Our developments are designed to function like small towns, bridging the gap between homelessness and a stable life.” She highlighted the nonprofit’s success in reducing homelessness in Houston by 60 percent.

She emphasized the importance of community integration through innovative housing designs, citing award-winning projects such as Brays Crossing and Reed, which provide essential services and local partnerships to enhance the well-being of residents.

Besnard, of Jonathan Rose Companies, provided insight into her firm’s strategic acquisitions aimed at preserving affordable housing. She described Jonathan Rose’s focus: “Our goal is not just to maintain affordability but [also] to enhance the quality of life for residents.” Besnard emphasized a recent success with the $102 million purchase of The Grove in San Jose, where Jonathan Rose intends to convert the property to rent-restricted housing.

Throughout the panel, several key themes emerged regarding the various challenges and opportunities present in the affordable housing landscape. Panelists expressed concerns over high burnout rates in mission-driven organizations, as the need for collaboration between public and private sectors to tackle complex issues around homelessness grows increasingly urgent.

The discussion also turned to the need for changes in local and state policies to better support affordable housing initiatives. Among the suggestions was implementing property tax exemptions proportional to the number of affordable units, which could significantly aid in preserving existing housing stock.

Ability Housing

“Developers can be part of the solution by supporting affordable housing initiatives,” said Nazworth, whose nonprofit, Ability Housing, is based in Jacksonville, Florida. Ability Housing is in the business of long-term ownership of permanent support housing. The nonprofit provides clients with housing sustainability and help in achieving their household goals.

The nonprofit also partners with neighborhood organizations to ensure that any revitalization efforts associated with the buildings are community serving. Ability Housing is interested in providing safe and affordable homes that contribute to a vibrant community. During the COVID-19 pandemic, Ability led an effort to disrupt the cycle of intergenerational poverty by providing housing for people who lost their jobs and linking those people to employment opportunities.

To fund these developments, Nazworth and her team use LIHTC, Florida state trust fund dollars, local government funds, and impact investment money. Impact investment funds could include below-market equity, leveraged with a state and local grant; philanthropic impact investing; donor advised funds; and loans with low-interest rates.

To establish these funds, Ability Housing approaches philanthropic partners—education, health, and faith-based groups—and persuades them to put their money into the nonprofit’s fund instead of a typical market-based fund. Furthermore, these partners also accept air rights and donations of land or purchase them at an under-market rate. These alternative options for a donor are attractive because they represent a long-term investment and enable the donor to stay involved in the projects.

Nowadays, Ability Housing is especially concerned about Florida’s seniors. Nazworth and her team are finding that increases in condo fees have put people over the edge of their budget and, consequently, they find themselves homeless.

New Hope Housing

Horak-Brown’s Houston-based nonprofit organization, New Hope Housing Inc., is the leading provider of supportive housing in Texas. New Hope was the first provider of this type of housing in the state, and the team includes a staff of 135-plus that operates 15 properties; those properties provide housing for persons who earn 60 percent to 50 percent AMI and less. New Hope is the largest voucher holder in Houston, with 700 project-based vouchers, and it provides housing and supportive services from 47 area partners for the chronically homeless (unhoused for 1–20 years, with a co-occurring disability) in Houston.

Architectural design and nature intersect at the nexus of New Hope’s work. Award-winning examples in Houston include Brays Crossing, a multifamily building with studio-efficiency apartment homes for single individuals living on zero to low income; and Reed, which includes a campus that functions like a small town, with health care and emergency services, services for women and children, the Bezos Academy—a tuition-free preschool—and a bus stop, all of which are for formerly homeless families.

Currently, Houston has reduced its rate of homelessness by 60 percent since 2011. Almost 3,300 people are experiencing homelessness in the city. New Hope assembles a capital stack that comprises one third tax credits, one third city/county funds, and one third philanthropic funds. All of its permanent support housing developments have zero debt, because New Hope raises that money and constructs the buildings. Services are costly, so that is where the funding goes. All workforce housing does have debt in the capital stack, but it is managed via philanthropic funds to ensure cash flow for the organization.

Jonathan Rose Companies

Besnard’s firm, Jonathan Rose Companies, handles green real estate policy, planning, development, owner’s representation, and investment. Jonathan Rose takes private equity and uses it for impact investing to preserve affordable housing nationwide. The firm buys properties that are at risk of losing affordability through a value–raise the rent strategy such as project-based Section 8 with LITHC and expiring 30-year affordability agreements.

A current example is The Grove in San Jose, California, a naturally mixed-income development that was for sale. JRC deployed equity funding and agency debt, then bid for the property and won it at $102 million.

Social impact, financial sustainability

In a discussion of the need to balance social impact with financial sustainability, panelists suggested that it depends on the size of the company and its potential commitment. For example, Amazon is a large corporate entity, and it established the Amazon Housing Equity Fund in Washington, D.C.; Seattle, Washington; and Nashville, Tennessee. This $3.6 billion fund includes below-market loans and grants for developers or owners to preserve and create more than 35,000 affordable homes. For smaller corporate entities, that may mean establishing funds that can fill financial gaps and help accomplish this work or creating an impact investing fund that can provide a risk-adjusted return.

Maintaining the right portfolio mix is crucial. Nazworth explained that, because Florida is not a social service–rich environment, Ability Housing has 50 percent of its units set aside for families experiencing homelessness and permanent supportive housing. One of its first (and maybe only) unsubsidized projects is a 12-story residential building on the St. Johns River. Ability Housing bought the building for $500,000. The nonprofit plans to sell it to self-subsidize rents. Another development is a 43-unit building of acute housing. Nazworth said that Ability would not do this type of development again, because a mix of households is good for residents’ long-term health and is preferred by residents.

Horak-Brown said that half of New Hope’s portfolio is housing for formerly homeless people. One development has 175 formerly homeless individuals. Now, New Hope plans to set aside 20 percent of its developments for “homeless light”—individuals who have landed in adverse situations in the short term and need stable housing.

Besnard said that JRC’s work consists of 80 percent project-based Section 8 vouchers. Residents pay 30 percent of their income on rent, and the buildings in which those individuals live are JRC’s best-maintained and best-serviced properties. Unless the U.S. Department of Housing and Urban Development (HUD) increases funding, however, this model is not replicable, because there will be no further supply of vouchers. An example of how the local sector can help meet this need is to come in as a stable partner that provides this subsidy or increases it through tenant-based vouchers.

Ongoing challenges

Panelists said that retaining staff is a major concern at a mission-focused organization, because even though passionate people are attracted to the work, it is demanding, and the burnout rate is high. Furthermore, the current political environment is confounding: politicians are aware of the need for affordable housing, but they are not identifying why people are homeless. Many community members still have a NIMBY (not in my backyard) mentality. The absence of certainty in U.S. governance and the lack of support for this type of work at the federal level further complicates matters. In addition, it can be challenging to source the money to retrofit older buildings and abate lead paint and asbestos to provide residents with a healthy building.

Panelists agreed that HUD staffing at its regional offices needs to be secured. Municipal, state, and federal governments have not increased project-based subsidies with long-term contracts for many years. More states and cities could provide more property tax exemptions for affordable housing, which would help owners maintain affordable housing properties.

Each panelist approached the current political and economic uncertainties with a slightly different perspective. Horak-Brown said that she is moving forward, though cautiously, and she realizes the ripple effect is long-lasting for housing that has not yet been provided. Nazworth said she is taking her foot off the accelerator and feels that, in six months, the next steps will be clearer. Besnard said that she is not sure what the future will hold. For her projects, environmental retrofits are on pause, due to the flow of federal dollars (or lack thereof). With residential developments, though, JRC continues to maintain services through its own funding.

Throughout, the panelists emphasized that affordable housing remains both a pressing need and a viable investment opportunity. As Besnard put it, “There is money to be made in affordable housing.”