The housing will be for the “missing middle,” residents who earn too much to qualify for affordable housing but not enough to be able to afford market-rate units.
“By focusing on middle-income housing, California cities can ensure that middle-income families and essential workers such as first responders, hospital and health care staff, and teachers, can afford to live near their jobs in the communities they serve,” Jeffrey Jaeger, principal and co-founder of Standard Communities, said in a statement.
The housing will be built across the state in the next 18 to 24 months.
The joint venture, known as Standard-Faring Essential Housing, has around $500 million of active deals.
And it has already created more than 650 units of middle-income housing in Southern California with a total capitalization of more than $400 million as part of a $2 billion plan.
It has used tax-exempt bond financing from the California Statewide Communities Development Authority for these properties.
“Historically, there hasn’t been incentives for private developers to put together public-private partnerships to create and expand this housing stock. All of the programs and subsidies, for the most part, have catered for the very low- and low-income subsets,” said Chris Cruz, managing director of essential housing at Standard Communities.
That changed in 2020 when CSCDA created a workforce housing financing program using a tax-exempt bond to finance the acquisition of multifamily projects, which is used in Standard’s projects.
Standard Communities serves as the project administrator while CSCDA owns the properties.
Cruz said the CSCDA program “unlocked financing avenues to create and preserve housing stock for the middle class.”
Cruz added that it was a new way for Standard Communities to provide housing to Californians.
Standard-Faring Essential Housing will work on ground-up development and acquire existing market-rate properties for conversion.
Until now, Cruz said, Standard Communities has focused on conversions of existing properties.
“There are more readily available projects to convert, and the creation and preservation of middle-income housing is done immediately,” he said.
Once Standard-Faring Essential Housing takes ownership of properties, it works with CSCDA to lower rents for qualifying residents earning 80% to 120% of the area’s median income.
“The expansion of middle-income housing is critical to California’s future as we prepare to host the Olympics in 2028 and is a key component of the state’s Regional Housing Needs Allocation goals,” Jason Illoulian, chief executive of Faring, said in a statement.
Standard Communities has had a busy year in L.A. The company recently led a public-private partnership that acquired the 357-unit Union South Bay Apartments in Carson to create middle-income housing.
The property is at 615 E. Carson St. and has more than 28,000 square feet of retail space.
Standard Communities also led a public-private partnership that acquired the 143-unit Link Apartments in Glendale.