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Modular housing gains lender comfort and regulatory momentum in SoCal
At a late-August conference, Impact Housing CEO Drew Orenstein said projects ranging from about 40 to nearly 500 units have seen backing from debt funds, regional banks, and national banks on affordable deals.
Factory-built housing is starting to move beyond the margins in Southern California as lenders grow more comfortable with modular construction and lawmakers clear regulatory barriers that previously limited scale, panelists told a Bisnow conference.
Bisnow reports that Impact Housing CEO Drew Orenstein said lenders have improved their comfort with modular, describing how his firm has worked with a debt fund on larger projects and with regional and national banks on affordable housing developments.
The Modular Building Institute estimates modular accounts for about 5% of construction activity in key market segments, but developers said financing challenges and disjointed regulations have held back broader adoption.
Bisnow also pointed to federal and California legislation aimed at reducing those barriers, including the Road to Housing Act, which became law in mid-July and directs the Department of Housing and Urban Development to identify financing obstacles for modular housing and evaluate whether a federal standardized modular building code could help adoption.