Created using an innovative social impact development model for veterans’ housing, Abrigo Apartments is located adjacent to the region’s new VA Medical Campus. The property reserves two-thirds of its 66 units for veterans exiting homelessness.
The Challenge
- Metro Denver is growing rapidly, making the housing market more competitive and affordable housing increasingly scarce
- The region’s homeless population faces more challenges to finding a home, even if they have rental subsidy vouchers
- Nearly 300 veterans are experiencing homelessness in the Metro Denver region; many of these veterans have VASH vouchers but are unable to access housing because of discrimination, tenant underwriting standards and other financial/logistical barriers
Our Goals
- Connect veterans experiencing homelessness to quality housing with improved access to support services
- Create and preserve more affordable housing in the Denver Metro area through a faster and more flexible approach that can meet both immediate and long-term housing needs
Our Approach
- Community Solutions bought the Abrigo Apartments, using a pioneering form of social impact investment:
- $7.5 million cost to purchase and rehab the property
- $2.5 million of social impact equity
- $5M million mortgage (Citi)
- Social impact equity was raised from individuals dedicated to creating housing for veterans experiencing homelessness:
- Equity return is capped at 3%
- Proceeds in excess of 3% buy down initial investment
- As interest is bought down, proportionate ownership is transferred to CS
- By Year 7, investors’ capital is returned (with 3% IRR) and CS owns the building for continued long-term operation as veterans housing
- Deal closed in just 90 days; the first veterans moved in less than 100 days from signing of purchase contract
- Two-thirds of the buildings’ 66 units will be set-aside for veterans; placement of veterans is done in direct coordination with the VA and the region’s Coordinated Entry System
- CS provides on-site property management using a “property management plus” model, which incorporates enhanced support and services for residents
