In response to a growing demand for more financially accessible rental housing, JLL has launched a national division dedicated to affordable housing as a part of their Valuation Advisory service. JLL had previously lumped affordable housing in with its main multi-housing practice, but it seems that the boom in demand for affordable housing is necessitating a new division entirely. The new division will be based in Tulsa, Oklahoma and, while there is no headcount specified, the announcement said that they intend to increase the number of people in their division to cope with the growing demand.
The decision comes off the heels of the Federal Housing Finance Agency’s (FHFA) updated affordable housing benchmark levels for Fannie Mae and Freddie Mac. The FHFA now requires both enterprises to back the development of 415,000 affordable homes to renters each year, which is 100,000 more than what was required in the previous year. The subgoal for apartments accessible to very low-income tenants who earn 50 percent or less of the Area Median Income (AMI) has also increased from 60,000 to 88,000.
Understandably, JLL expects a “surge in the amount of new affordable and workforce housing developments.” The affordable housing sector has often been seen as its own sub-section of the real estate industry, one that takes different skills and networks than traditional multifamily. There is more interest in affordable than even, perhaps JLL’s new division could help bring new investors into this much needed asset type.