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'It's certainly a challenge': Affordable housing developers struggle with financing in Lee County

Civitas Apartments.jpg
Posted at 2:01 PM, May 10, 2022
and last updated 2022-05-10 14:01:41-04

LEE COUNTY, Fla. — One of the biggest issues the housing market is facing is the number of homes available for people to rent. A Florida developer is adding to the Cape Coral inventory with affordable housing.

Michael Allan, president of Revital Development, says money is one of the biggest obstacles developers are facing today.

"It's certainly a challenge, Allan said. "A lot of it has to do with the financing involved. So our project, for example, is the main driver in terms of the subsidy for it is low-income housing tax credits."

By subsidy, Allan means money from the federal, state, or local government to help build affordable homes. He's developing Civitas in Cape Coral, a 96-unit affordable housing complex.

Allan planned to start the project in mid-2019, but COVID hit a few months later.

“The market has not been able to keep pace with that by adding inventory," said Dr. Shelton Weeks, a real estate professor at FGCU.

Adding inventory comes at a price many developers can't keep up with.

"We’ve experienced 30-40% cost increases in the past 12 months or so and that’s development costs," Allan said. "The cost of concrete is the same as everybody else’s cost of concrete."

Allan says affordable stuff is just really tough to develop as well as the workforce housing.

He plans to break ground this summer or the fall. It'll take anywhere from 12 to 14 months to finish.

There's help out there if you are struggling to pay for rent or utilities in Lee County. There are a few emergency rental assistance programs paid for by the federal government.

Applications are due by May 16. You can click here to apply.