I'm a little late to this discussion, but am extremely interested and don't feel informed enough yet, but may have a bit to add to the discussion.
I worked last year for a for-profit company that has a mission to provide housing for societal benefit. They use all of the various tax credit programs around the country to do this. Unfortunately, their organization was run by a lot of the "idea" people and few/none of the "how do we actually do this and stay in business" people. I got stuck on a massive hole of a student housing project (not the low-income housing projects I wanted to work on) that lost the company about a million dollars. I became very miserable, deeply depressed actually, and got out in January...two months ago I went to work as a project manager for a sign company.
One thing I learned is that I don't think a business can be for-profit and do social housing projects well. The competing motives eventually become an issue and when investors expect a certain profit margin, the end product will eventually be less than it could be or you will actually go out of business.
One new thing I did learn last year is that sticking all low-income or homeless people together in one area is detrimental to the goal of helping them better their lives. Not sleeping in the rain is about all you provide as they will feed off of one another and usually create a horrible living environment wrought with substance abuse and domestic violence which furthers the cycles rather than breaks it.
One of the standards of our low-income housing projects was that we intermingled full rent tenants with subsidized tenants. Our social worker staff members were adamant about that, and I agree with it.
I am leaning closer and closer to making housing for those in need my life mission (ministry actually). My current job is simply a means to provide for my family until I can get there...which will likely have to be phased in over years, but is also providing me further construction experience. My mother is the executive director for a women's abuse shelter and she can do a lot to help me as well as a good friend of mine who is the director of outreach programs for the largest church in Missouri. They both work daily in the world of homeless and people in need. As a former CPA and finance major, I know how to generate budgets, project cash flow and make it work with lenders.
My current dream is this;
- Create a non-profit organization and seek donations to start with remodeling homes in low-income housing areas to generate rental properties out of them.
- Once a stable portfolio is achieved of normal rent properties, (probably about 3 or 4), make the next one a rent free/low rent facility and find a social organization that can get me connected with a family in need.
- Prove viability/sustainability of this concept while developing the program for improving the rent-free tenants lives. In the meantime, keep remodeling/generating rental properties.
- Once this concept is viable and repeatable, multiply it as much as possible while continuing to accelerate it with outside fundraising.
- After this is working well (hoping after 3 years)...I want to begin actual development of areas for mixed use housing. I would start with a street of about 8 houses. Make 4-6 full rent with 2-4 low rent/rent free.
- Final stage would be full apartment buildings...either through remodel or new construction with the same concepts.
My main purpose of doing this as a non-profit and leaning on private donations is to avoid the bureaucracy and overhead of jumping through those governmental hoops. The central theme will be financial sustainability of current properties while using donations to boost growth. The free/low rent housing will be subsidized by the full rent housing. Basically this model is exactly what my old company did, but without relying on governmental credits and trying to generate a profit. It may limit my ability to leverage and do more, but I think expanding the portfolio of properties over time will have a great deal of effect.
At this point, this is all just me and scribbles on a napkin, but I'm starting to think it through more thoroughly. Actually just writing this all out has been a huge help.