The Michaels Organization, a Camden, New Jersey-based residential real estate developer, manager, builder and investor, has acquired an affordable and workforce housing portfolio totaling 831 units across 12 properties in the Indianapolis and Fort Wayne, Indiana, metropolitan areas.
The portfolio includes two workforce housing communities and 10 Low Income Housing Tax Credit (LIHTC) communities — including Hauenstein Hills II in Huntington, Indiana, pictured above — for residents at or below 60% of the area median income, according to a press release. All of the properties were either built or renovated between 2003 and 2020.
The firm said it will retain most of the existing on-site staff at these properties and add social services.
"Our strategy is really long-term affordable housing, so that may mean, down the line, some sort of rehabilitation [using LIHTC funds]," Kunal Chothani, vice president of acquisitions for The Michaels Organization, told Multifamily Dive. "Not much will change in the day to day that people will see, but we hope to further lift lives by adding social services on site, as well as training up our new teammates with our best practices."
This acquisition expands the firm’s Midwestern presence to more than 5,300 apartment units. In addition to Indianapolis and Fort Wayne, the company maintains holdings in:
- Chicago
- Wichita, Kansas
- Detroit
- Jackson, Michigan
- St. Paul, Minnesota
- St. Louis
- Kansas City, Missouri
- Dayton, Ohio
On the rise
The workers with the highest-growth jobs in Indianapolis and Fort Wayne are also the most likely to need workforce and affordable housing, Jake Ross, principal at RCLCO, told Multifamily Dive.
Indianapolis saw its largest employment gains in professional and business services; trade, transportation and utilities; and education and health services. Fort Wayne’s fastest-growing industries include education, health services and manufacturing.
"The rental apartment market in Fort Wayne is performing strongly, with vacancy rates at historic lows despite a recent uptick in deliveries," Ross said. "The pipeline is also reasonably shallow, and the market is likely to have pent-up demand for new housing in the years to come."
Indiana’s employment is on an upward trajectory, with 82,400 jobs added between December 2020 and December 2021. It is expected to continue to grow over the next decade, according to the State of Indiana’s Department of Workforce Development.
"We think Indiana has a great future in attracting jobs," Chothani said. "We’re definitely interested in more opportunities in Indiana, and then west."
