Investment managers plan to allocate 24 percent of projected capital raised between October 2024 and September 2026 to new development, according to a recently released Federal Reserve Bank of New York case study.
During the previous five years, this figure was 7 percent.
The case study focuses on private investment vehicles in affordable multifamily rental housing. It is based on a survey of 22 managers conducted between November 2024 and March 2025. Questions centered on the five-year period ending September 2024 as well as projections for the two-year period ending September 2026.
“Addressing the nation’s shortage of affordable rental homes will require creative solutions,” Jonathan Kivell, New York Fed director of community investments, said. “We hope the case study spurs more research on how private capital can affect the availability, quality, and cost of housing for low- and moderate-income families.”
As of September 2024, the respondents had a total of 293,735 affordable housing units in their portfolios with a median of 10,245 units per respondent. Of those, 24 percent are naturally occurring affordable housing and 76 percent are income restricted.
During the five-year period, respondents invested more than $18.6 billion in total equity capital. Half was in apartments serving households earning less than 60 percent of area median income.