How Can YOU Invest in Housing?

Guest Opinion

By Yarrow Brown | April 27, 2024

We have an opportunity in northwest Michigan to invest in our community and work collaboratively to address the housing crisis. If you are a community member, business owner, or employer, you can help. Everyone can work to be effective and support housing solutions in their community!

How can you help bring housing for employees? One way is to consider a partnership with other business owners or companies. This can be very impactful, especially if you know that others in your area or in your sector are facing the same problem. Partnering with another employer can also help create visibility for the issue, which could lead to public support.

Working together also creates an economy of scale for purchases and negotiations for housing. For example, Cherry Republic and Andersons Market in Leelanau County partnered to provide seasonal housing for their employees.

So how do you do this? You can jointly purchase, develop, or rehab housing. You can also jointly purchase land, or raise capital to partner with developers, or multiple employers could “endorse” a specific lender in exchange for discounts. Or you can negotiate long-term leases with developers to help them attain a balance of affordable and market-rate housing for the community.

As a business leader, you can also partner with the public sector to maximize your effectiveness and create long-lasting change to improve your community by being a spokesperson and advocate for a project or policy change. You can provide leadership to public bodies to encourage zoning reform for housing and incentive tools or contribute financially to a housing trust fund. You can work with the local government to issue bonds for below-rate mortgage/second mortgage guarantee or explore creative public-private partnerships through a land bank.

Locally we are seeing examples of community investment, such as Commongrounds in Traverse City. This unique project combines public and commercial space with housing and is a cooperative owned by its members.

In the Petoskey area, an investment cooperative has formed called InvestMitt to learn about how the community can invest in a housing project and preserve year-round housing. InvestMitt is working with the National Coalition for Community Capital (NC3), a new national organization that works with communities using community capital to create local funds to invest in housing, as well as other economic opportunities.

They’ve created what they are calling a “diversified community investment fund” (DCIF). A DCIF is a community-scale fund that invests primarily in real estate but also invests in local businesses. They do this with investment capital raised publicly from within the fund’s own community, including non-accredited investors. A DCIF can distribute profits to its community investors, thereby creating a wealth-building opportunity for everyone, while contributing to a more vigorous local economy.

We also see some examples in Montgomery County, Maryland. They have a housing production fund through the Housing Commission that is around $100 million to invest in over 6,000 homes. Counties in our region could consider this option as well. They can invest in local Community Development Finance Institutions (CDFIs), create their own revolving loan funds, or create a mechanism through the Brownfield Redevelopment Authorities and Land Bank Authorities to support housing through low interest loans or grants.

Nonprofits like Housing North and your local Economic Development Organizations (EDOs) like Leelanau Peninsula Economic Foundation, Traverse Connect, Northern Lakes Economic Alliance, or Alliance for Economic Success are also here to help. For example, Housing North has a Housing Ready program, which can provide technical support from housing tools for different scales of projects, to making connections with business partners and developers, to potential investment opportunities.

The EDOs are critical partners with our business community and units of government to help connect housing to economic development and collaboratively bring in more opportunities for our employees and communities. You can lean on these organizations to facilitate employer roundtables, sessions, and dialogues to find common needs, challenges, and potential solutions for your organization. They can help connect to funding resources and support grant applications that would bring more opportunities around housing.

We are all working to remove barriers to housing development and support housing solutions. We have local and national examples we can draw from to create our own opportunities for funding in our region.

If you are someone who cares about our region, I encourage you to find a way to invest in housing for everyone and see the return on your investment go back into your community.

Yarrow Brown is the executive director of Housing North, a 10-county housing agency serving northwest Michigan.