Interview with Rob Likes, KeyBank Real Estate Capital
Funding for affordable housing is needed more than ever as demand continues to rise. Private sector banks and institutional investors see this as an opportunity to revitalize neighborhoods and generate profits. KeyBank sees this as an opportunity to balance its margin with its mission.
Rob Likes is the National Manager, Community Development Capital / National Affordable Housing Platform, at KeyBank Real Estate Capital. Robert Likes has over 25 years of experience in the real estate banking industry and is the National Manager for KeyBank Real Estate Capital’s National Affordable Housing Platform. He leads a Team of 60 people in the origination of debt, equity, and perm products in the multi-family and affordable housing industry, and leads the Team in the management of a portfolio in excess of $2 Billion. He is a graduate from Brigham Young University in Business Management Finance with additional emphasis in Accounting and Economics. He also completed the certificate program in Management for Execution from Cornell University. He is actively involved in numerous real estate industry organizations.
Why is there a housing shortage in the lower end market and how is it being addressed?
The capital markets collapse in 2008 caused construction of new multifamily units to come to a screeching halt. Both market rate and affordable multifamily construction starts were affected and construction volume didn’t begin to recover until the 2010 -2011 period, albeit at a lesser pace. During the same period, population growth continued, foreclosure rates soared to an all-time high, and more people found themselves in need of affordable housing. The demand for multifamily units has consistently outpaced supply, creating a gap, causing multifamily rental rates to increase dramatically.
At this time, many families owe more than 50% of their income to rent each month, and statistics tell us that as rental rates have continued to grow, incomes have gone flat. It’s not economically or socially advantageous to continue raising the cost of rent because it leaves people with less income for important items like food, health care, education, and transportation.