Affordable Housing REIT Shining Light on Emerging Sector

2020 has been a tough financial year.

On a global scale, the coronavirus pandemic set off a major disruption within industries all around the world. In the United States, these economic stressors were felt across the board. Unemployment rose, the economy entered its first period of decline after years of growth, and households suddenly saw significant changes in income.

In response to the changing financial circumstances, government officials and industries alike are looking for solutions to today’s economic turbulence. Using rent forgiveness policies as an example, it’s clear to see that many of these solutions involve the commercial real estate scene.

However, CRE is also carrying its own weight. The multifamily sector has been eyeing affordable housing developments as a necessity amid today’s economic crisis. Real estate investment trusts (REITs) are pushing this movement forward – and it’s helping brighten the outlook for both CRE and its tenants.

Here’s what affordable housing REITs mean for CRE investors, property owners, and developers:

Commercial Real Estate Seeks Stability

Right now, everything is about resilience.

Commercial real estate is finally regaining its balance after a treacherous year. Even though the outlook has improved, uncertainty still looms on the radar. The coming months into the new year may hold more surprises – something that the industry is more open to consider after learning the hard lessons of COVID.

Fostering resilience, flexibility, and stability is the primary goal for commercial real estate professionals. Everyone is looking for ways to pivot in case of an emergency, stay afloat even in the worst of times, and future-proof their movements for added safety.

The Promise of Affordable Housing

While seeking a resilient strategy to stay strong during market turbulence, multifamily has caught the eyes of many CRE professionals. Investors and developers are switching lanes to dip their toes into the multifamily sector.

During the worst of the pandemic, the apartment sector was one of the best performing commercial markets. This is due to the necessity of housing – people could skip out on shopping or going to the office, but they needed somewhere to live.

These crisis-minded commercial real estate professionals are zooming in on the affordable side of multifamily for added security. Instead of ultra-luxe, high-priced communities, affordable projects are holding all of the promise.

Right now, affordable housing is being viewed as one of CRE’s strongest and most resilient investment categories. It shouldn’t be a surprise that everyone in the business is eager to get involved.

The Promise of Affordable Housing REITs

Affordable housing REITs are quickly becoming the golden child of today’s commercial real estate scene. Even prior to the pandemic’s disruptions, affordable housing and opportunity zones were at the forefront of CRE development. After what the industry faced in 2020, the focus on affordable housing is continually intensifying.

Aspire Real Estate Investors has recently kicked off the first affordable housing REIT, shaping an acquisition pipeline hovering $1.1 billion. This REIT is publicly-held, and it’s becoming a staple of today’s CRE investment arena. Moving forward, expect to see major developments to affordable housing in the United States.

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