NC Nonprofit Eyes REO-to-Rental Initiative

Multifamily Executive has a story about Raleigh-based Builders of Hope and it’s plans to convert foreclosed homes to affordable housing:

But at least one nonprofit is eyeing the program as a solution to our nation’s affordable housing problem. Builders of Hope, a Raleigh, N.C.-based developer, has secured a $100 million fund as part of its “Upcycle” program to acquire and rehabilitate foreclosed or otherwise vacant houses into affordable rentals.

The company acts as a one-stop shop, acquiring assets, serving as its own General Contractor and ultimately managing the properties. Its vertical business model gives it a leg up in terms of bulk, scattered-site deals…

Since it’s creation in 2006, Builders of Hope has acquired about 500 units and 80 percent are multifamily housing. The company has acted as co-developer on low-income housing tax credit deals and, in its brief history, has received about $12 million in Neighborhood Stabilization Program funding.

The organization, which bills itself as “social entrepreneurs,” hopes to acquire between 1,500 and 2,000 units this year—year one of a five-year agreement with its investors. If that $100 million is spent this year, it will be replenished next year, and so on—meaning the fund could end up totaling $500 million.