Community Preservation Partners (CPP Housing), the nation’s third most active preservation developer, today announced the addition of two affordable housing specialists, Tom Gibson, senior development manager, and Michael Anderson, senior acquisitions associate, to support the growth of its East Coast division and the company’s dedicated efforts to obtain and preserve affordable communities across the United States. CPP East’s portfolio currently includes $450 million in investments toward 2,000 affordable housing units across 13 communities in eight states.
Gibson, PMP,LEED AP, BD+C comes to CPP with extensive experience structuring and managing complex multifamily developments through creative financing strategies and public-private partnerships. In this capacity, Gibson leads CPP East’s in-house team of developers through the successful completion of preservation projects. He is responsible for assembling and managing all external team members across various stages of development, including financiers, architects, designers, engineers and contractors.
Anderson has more than 10 years of real estate experience spanning commercial brokerage, investment sales and multifamily development in the states of Delaware, Maryland, New Jersey and Pennsylvania. In his role at CPP, Anderson is responsible for identifying, analyzing and structuring the acquisition of affordable housing opportunities to grow CPP’s investment portfolio, expanding the company’s footprint east of the Rocky Mountains.
“CPP is in growth mode, with an additional $250 million in investments in our current pipeline in the next year alone,” said Seth Gellis, vice president at CPP East. “We’ve made tremendous strides in preserving affordability in new neighborhoods across the U.S. The East Coast team is setting our sights on being active in at least 13 states by 2023, with the company goal of being in 25 states across the country by 2025. The talent and connections Gibson and Anderson bring to our team will enable us to source more deals and efficiently complete the financing and rehabilitation of communities, in turn impacting the lives of residents for decades to come.”
Recognized as a “40 Under 40” honoree by both Alexandria and Arlington, Virginia Chambers of Commerce, Gibson has earned a reputation in affordable housing within the D.C. metro area, having been appointed by the Governor of Virginia, Senate of Virginia, Arlington County Board and City Council of Alexandria to various boards and commissions serving Northern Virginia and the Commonwealth. As the youngest gubernatorial appointee in Virginia Housing’s history, Gibson currently serves as vice chair and has held several board positions with the agency since 2016.
Gibson is a veteran and current artillery officer in the U.S. Marine Corps Reserves. After returning to civilian life, he consulted for the Housing Authority of Prince George’s County and was formerly vice president of development for Stratford Capital Group where he managed new construction and complex acquisition rehabilitation projects in Northern Virginia, Maryland, Georgia and Florida, totaling 561 units and $143.2 million in total development costs. Gibson received his M.B.A. from Cornell University, an M.P.S. in real estate from Georgetown University and his B.A. from the University of Virginia. He is currently pursuing a Master of Liberal Arts (ALM) from Harvard University.
“The intelligence of its leaders, structure for success, and purpose of its mission were strong factors for joining CPP,” said Gibson. “I’m looking to drive development utilizing more efficient methods so we can complete more deals. There is still so much work left to do in making affordability a reality for those who need it most.”
Anderson entered the affordable housing industry in 2018 when he kickstarted an affordable investment sales team in Philadelphia Here, he focused on Section 42 LIHTC and Project-Based Section 8 asset sale facilitation up and down the East Coast. Previously, he held positions supporting office/retail leasing and ground-up multifamily development. Anderson is a graduate of Temple University’s Fox School of Business and is a licensed real estate agent in Pennsylvania.
“I was immediately drawn to CPP’s people-first culture and its team of purpose-driven affordable housing experts who are making a difference in communities across the nation,” said Anderson. “I’m looking to create and maintain relationships with the ownership and brokerage communities to generate new opportunities for CPP so it can continue its important revitalization work – a mainstay for the affordable housing industry.”
Gibson and Anderson will be based out of CPP East’s headquarters in Reston, Virginia. CPP continues its aggressive growth initiative to expand its footprint across the country. Communities recently closed in the U.S. have led the company to deepen the affordability of neighborhoods across Colorado, Utah, Montana, New Jersey, New Mexico, New York, Oregon, Pennsylvania, Tennessee, Connecticut and Virginia, in addition to its long history of providing affordable housing solutions across the state of California.
In California, the cost of housing is among the highest in the country, making affordable housing essential for many working families. The Area Median Income (AMI) is used to determine eligibility for many publicly-funded affordable housing programs, particularly through the Low-Income Housing Tax Credit (LIHTC).
According to the Department of Housing and Urban Development (HUD), AMI is the midpoint of a region's income distribution, meaning that half of the households in that area earn more than the median and half earn less. AMI is calculated each year by HUD for metropolitan areas and regions in the United States. So, the demographics and AMI qualifications vary across the country.
Below is a breakdown and overview of AMI qualification levels in California.
Understanding who qualifies for affordable housing helps tailor developments to meet the needs of local communities, ensuring a range of affordable housing options that reflect income diversity across the state. The diverse workforce in California, combined with the high cost of living, makes affordable housing at various AMI levels critical. As a result of these cost burdens, the need for housing support extends beyond traditional low-income families and into individuals and families that work in professions such as government, service and entry-level professionals. Expanding access to affordable units ensures that the entirety of the state’s workforce has the stability needed to thrive in the high-cost environment of California.
By: Belinda Lee, Director - Development
The Low-Income Housing Tax Credit (LIHTC) program has been an essential component of affordable housing finance since it was enacted as a part of the Tax Reform Act of 1986. Originally created as a tool to encourage public-private partnerships to increase the low-income housing stock, it has been modified several times. Since inception, it has supported the generation of more than 3.5 million affordable housing units nationwide.
Through the LIHTC program, state and local LIHTC-allocating agencies have the authority to allocate approximately $10 billion in federal funds each year to issue tax credits for the acquisition, rehabilitation, or new construction of rental housing targeted to lower-income households. Generally, the state and local agencies award LIHTC credits to private affordable housing developers through a competitive process. Then, developers typically sell the credits to private investors to obtain funding.
Only rental properties (e.g., apartment buildings, single-family homes, smaller multi-unit buildings) qualify for LIHTC. To qualify, the owners or developers of the affordable housing project must meet certain income tests for tenants and rent. Projects must pass one of the income tests below and agree to comply with these parameters for a minimum of 15 years (though some state agencies may require compliance for 30 years):
LIHTC offers investors a dollar-for-dollar reduction in their federal tax liability in return for providing capital to support the development of affordable rental housing. This investment helps subsidize the construction of low-income housing, enabling the units to be rented at rates below the market value.
Investors can claim LIHTC credits, which are calculated by multiplying a credit percentage by the project's qualified basis, over a 10-year period once the affordable housing project is available for tenants. The tax credit is distributed pro rata over this period and can be applied to the construction of new rental buildings or the renovation of existing ones. LIHTC is designed to cover 30 percent or 70 percent of the costs for low-income units in a project. The 30 percent subsidy, known as the automatic 4 percent tax credit, applies to new construction with additional subsidies or the acquisition of existing buildings. The 70 percent subsidy, or 9 percent tax credit, supports new construction without any extra federal subsidies.
LIHTC is essential for the funding of affordable housing projects for several reasons:
By making housing more accessible, LIHTC contributes to improved health and educational outcomes for residents, ultimately promoting social stability and enhancing quality of life. Its ongoing significance in combating housing insecurity makes LIHTC a vital tool for policymakers, developers and communities alike.
Affordable housing refers to housing that is reasonably priced, allowing low- and moderate-income individuals or families to live comfortably without spending an excessive portion of their income on housing. Typically, the standard guideline is that housing costs, including rent and/or mortgage payments and utilities, should not exceed 30% of a household's gross income.
Affordable housing can come in various forms, including government-subsidized housing, public housing projects, and private developments that offer reduced rents or prices. The goal is to ensure that everyone has access to safe and decent living conditions regardless of their financial situation.
Market Rate vs. Affordable Housing
While housing affordability is currently an issue across the United States, there are several key differences between housing categorized as “affordable” versus “market-rate”. Understanding these differences is essential for addressing housing needs and creating policies that promote inclusivity and accessibility in housing markets.
Importance of Affordable Housing
According to the Pew Research Center, in 2020, 46% of American renters spent 30% or more of their income on housing, including 23% who spent at least 50% of their income this way. The same study indicated that about half of Americans (49%) see the availability of affordable housing as a major problem in their local community. Affordable housing is a cornerstone of a healthy society, contributing to individual well-being and broader economic and social stability. Key benefits of affordable housing include:
In California, the cost of housing is among the highest in the country, making affordable housing essential for many working families. The Area Median Income (AMI) is used to determine eligibility for many publicly-funded affordable housing programs, particularly through the Low-Income Housing Tax Credit (LIHTC).
According to the Department of Housing and Urban Development (HUD), AMI is the midpoint of a region's income distribution, meaning that half of the households in that area earn more than the median and half earn less. AMI is calculated each year by HUD for metropolitan areas and regions in the United States. So, the demographics and AMI qualifications vary across the country.
Below is a breakdown and overview of AMI qualification levels in California.
Understanding who qualifies for affordable housing helps tailor developments to meet the needs of local communities, ensuring a range of affordable housing options that reflect income diversity across the state. The diverse workforce in California, combined with the high cost of living, makes affordable housing at various AMI levels critical. As a result of these cost burdens, the need for housing support extends beyond traditional low-income families and into individuals and families that work in professions such as government, service and entry-level professionals. Expanding access to affordable units ensures that the entirety of the state’s workforce has the stability needed to thrive in the high-cost environment of California.
By: Belinda Lee, Director - Development
The Low-Income Housing Tax Credit (LIHTC) program has been an essential component of affordable housing finance since it was enacted as a part of the Tax Reform Act of 1986. Originally created as a tool to encourage public-private partnerships to increase the low-income housing stock, it has been modified several times. Since inception, it has supported the generation of more than 3.5 million affordable housing units nationwide.
Through the LIHTC program, state and local LIHTC-allocating agencies have the authority to allocate approximately $10 billion in federal funds each year to issue tax credits for the acquisition, rehabilitation, or new construction of rental housing targeted to lower-income households. Generally, the state and local agencies award LIHTC credits to private affordable housing developers through a competitive process. Then, developers typically sell the credits to private investors to obtain funding.
Only rental properties (e.g., apartment buildings, single-family homes, smaller multi-unit buildings) qualify for LIHTC. To qualify, the owners or developers of the affordable housing project must meet certain income tests for tenants and rent. Projects must pass one of the income tests below and agree to comply with these parameters for a minimum of 15 years (though some state agencies may require compliance for 30 years):
LIHTC offers investors a dollar-for-dollar reduction in their federal tax liability in return for providing capital to support the development of affordable rental housing. This investment helps subsidize the construction of low-income housing, enabling the units to be rented at rates below the market value.
Investors can claim LIHTC credits, which are calculated by multiplying a credit percentage by the project's qualified basis, over a 10-year period once the affordable housing project is available for tenants. The tax credit is distributed pro rata over this period and can be applied to the construction of new rental buildings or the renovation of existing ones. LIHTC is designed to cover 30 percent or 70 percent of the costs for low-income units in a project. The 30 percent subsidy, known as the automatic 4 percent tax credit, applies to new construction with additional subsidies or the acquisition of existing buildings. The 70 percent subsidy, or 9 percent tax credit, supports new construction without any extra federal subsidies.
LIHTC is essential for the funding of affordable housing projects for several reasons:
By making housing more accessible, LIHTC contributes to improved health and educational outcomes for residents, ultimately promoting social stability and enhancing quality of life. Its ongoing significance in combating housing insecurity makes LIHTC a vital tool for policymakers, developers and communities alike.