As we enter a new year, NeighborWorks America's network organizations examine the lessons they're carrying with them from 2019. Last time, we heard about a community project and the art of the ask. Today, regional representatives talk about forming partnerships, tiny houses, competing for new hires and the challenges of NOAH projects.
Community partnerships
NeighborWorks of Southern Colorado (NWSOCO) has built new subdivisions before, but never one this big.With new partnerships and a Program-Related Investments (PRI) grant from the Colorado Health Foundation, "we've put together multiple components that will, in 10 years, allow us to have a 400-plot subdivision," says Ashleigh Winans, NWOSCO's chief executive officer.
It was the health foundation that played matchmaker, gathering nonprofits for a conversation that included NWSOCO and indieDwell, a modular homemaker with a factory opening in Pueblo in early 2020. Land trusts also joined the partnership.
"This is the first time where we have intentionally built out partnerships ahead of securing the ground," Winans says. "That's been interesting. I think doing it this way, we'll be able to plan the subdivision even more intentionally."
Each division has its own funding. NWSOCO's million-dollar grant will go toward mortgage loans. They also received a supplemental $650,000 ($250,000 in cash equity to keep on the books, and $400,000 for capacity building, including hiring a new lending officer).
"There were a lot of moving parts in the beginning to figure out how to partner together and what that looks like — to make sure we each had the necessary level of commitment to make it work," Winans says.
The project will feature a range of units, and will move ahead in phases, 50 plots at a time.
Winans identified two big takeaways:
- Mission: "You have to stay true to your mission," she says. There's a temptation, especially when there are several partners, to ask organizations to do things that are outside their wheelhouse. Winans says she had some tough conversations, but in the end, was able to stay true to the way her organization approached affordable housing. "Things are going in a direction everyone can agree on, without compromising our respective missions."
- Communication: Keep lines of communication not just open, but "extremely open," Winans says. When they began, the health foundation, indieDwell and NWSOCO were in the conversation but the land trust was not, she explains. The land trust dropped out, and the remaining organizations added land-trust partners to their team. "I think it's really important that everyone is a part of the conversation. You need an understanding of where things are going."
"I think the hardest part was starting. Now we have a vision of where we're going."
Benefits of being green
A high-profile project for ONE Neighborhood Builders involves a plan for five, zero-energy, affordable homes, to be located on three quarters of an acre in Providence, Rhode Island."The ecological nature is not just the fact that the homes are zero-energy, but we're trying to be mindful of the land on which we're constructing them," says Jennifer Hawkins, ONE's chief executive officer. As they began planning, the architect suggested they make the homes not just net-zero, but passive, which is what Hawkins calls "the absolute platinum standard" for a green home.
Known as the Sheridan Small Homes project, the houses will feature crushed gravel driveways, solar panels, thick walls, triple-paned windows, two bedrooms, and one and a half baths and will clock in at 725 square feet.
Hawkins says the pendulum is swinging toward smaller homes, a trend she expects to continue. "We don't need that much space," she says. "We can live in a smaller area and because of that, the construction costs will be somewhat less."
For construction, ONE Neighborhood Builders will partner with Building Futures, which has a pre-apprentice training program for workers who face barriers to employment.
Some lessons:
- The next level isn't easy: It's hard to build at a passive level, Hawkins says. "I didn't realize quite the difficulty of it. There's a huge difference between ‘highly efficient' and ‘passive.' It's a pretty high bar."
- Building for climate can lower energy costs: "We really do believe we have a responsibility to build in an ecologically sound way. In so far that we can make our future homes at zero energy, we want to do that. It reduces the cost burden for our lowest-income home buyers." Traditional heating for a typical home can spike to several hundred a month during a New England winter, she adds.
- It's doable: "Responsible building is doable," Hawkins says. "Zero-net is doable."
Hawkins says she doesn't expect to see a profit this go-round; it's more about proof of concept. "We got subsidies and grants from everyone. But we really believe if people walk through it and see it, it'll be easier the next time."
"We were getting the question: ‘Is it going to be affordable or it going to be green?'" Hawkins says. " It shouldn't have to be either/or."
Competing in the workplace; the realities of NOAH
Alan Arthur, president and CEO of Minnesota's Aeon since 1988, has a few takeaways from 2019. The first is about recruiting personnel."All of our peers are talking about the fierce competition for staff people, especially on the property operations side. We have to do everything we can to make ourselves attractive, so people understand the benefit of working for an organization that cares about other people, an organization that has a mission and a vision and a purpose for the work, instead of someone who's going to profit from the bottom line."
How?
"The No. 1 thing is don't be afraid to sell our vision, our purpose and our mission," Arthur says. "Our ability to compete with for-profits is our sense of purpose."
Arthur's nonprofit has spent years working with NOAH, or Naturally Occurring Affordable Housing, projects. They are about to acquire 1,200 more units in addition to the 1,800 they've already acquired, he says, searching his office for wood and then knocking on it.
He says he could write a thousand-page manual on his lessons learned. But he narrowed it down to just a few.
- Understanding: Understand the physical and social realities of NOAH properties. Social realities are as important as the physical, he says. You have to look at things like demographics, "which may have implications on who you hire, the different languages you need to translate, the assistance you need to provide for the residents and their children to be successful."
- Tell your story: Do a good job telling your story to equity investment partners. "The more you do it, the better you get at it."
- Look closely: "Get many eyes as possible looking at the rehabilitation needs of the property so that you can fully understand them."
- Line up lenders: If you're going to be involved with the acquisition of NOAH units, Arthur recommends establishing three times as many relationships with people with capital as you have previously. "You need equity partners, you need more and different lenders. And you need multiples of them because one is not going to be your partner on all your NOAH acquisitions; they're not going to put their eggs in one basket."
