Industry Expertise

The rollout of incentives for more affordable housing has accelerated and will likely continue with housing affordability at the forefront of the national dialogue. New incentives have been introduced at the state, local, and federal levels to make workforce housing more financially attractive for developers. Typical workforce housing incentives include:

Loan subsidies for projects that support low-income households. For example, Virginia's Workforce Housing Investment Program provides up to $3 million in grants or loan subsidies for projects housing workers earning 80–120% AMI, provided the location is near major job centers.^{Disclosure 3}

Tax abatements to spur more developers to initiate workforce projects. New Jersey's State Tax Credit Subsidy (STCS), launched in late 2025, uses competitive auctions to incentivize private investment in workforce housing through state tax credits.^{Disclosure 4} Another program, Montgomery County, MD (More Housing N.O.W.) allows for "Payment in Lieu of Taxes" (PILOT) programs, exempting qualifying workforce developments from 100% of real property taxes for up to 20 years.^{Disclosure 5}

Zoning exceptions to density, height, parking or other requirements in exchange for a guaranteed number of affordable units. For example, Maryland's "Housing Starts Here" was created by the Housing Expansion and Affordability Act along with recent executive orders to streamline development on state-owned land near transit and modernize land-use laws to expedite approvals.^{Disclosure 6} California School District Workforce Housing (AB 1021) allows school districts or educational agencies to develop housing on their land and limits certain local zoning barriers for workforce housing tied to education employees.^{Disclosure 7}

Beyond these examples, localities have a wide variety of incentives and programs for projects that expand housing in the "missing middle". Efforts to reduce project approval timelines can make a meaningful difference: States like California and Maryland have implemented aggressive, enforceable timelines for government agencies to approve housing projects, reducing the "carrying costs" that can burden projects.

Several federal level changes increase support for low-income housing, sometimes a component of workforce housing projects.

The One Big Beautiful Bill Act (OBBBA) - Enacted in July 2025, this major legislation lowered the Private Activity Bond (PAB) threshold from 50% to 25% starting in 2026. This allows developers to qualify for 4% Low-Income Housing Tax Credits (LIHTC) with much less bond financing, freeing up capital for other project needs.^{Disclosure 8}

Workforce Housing Tax Credit (WFHTC) proposal - A federal proposal modeled on the Low-Income Housing Tax Credit would target middle-income households not served by traditional LIHTC. Developers receive credits allocated by state housing agencies and sell them to investors to raise equity, potentially covering up to 50% of construction costs for qualifying workforce housing developments.^{Disclosure 9}

HUD budget Increases - The FY 2026 budget signed in early 2026 provided $77.3 billion for HUD, a 9.3% increase aimed at boosting rental assistance and housing programs.^{Disclosure 10}

Workforce housing developments span a wide variety of property types, ages, and locations. Some projects generate favorable returns using the wide range of incentives supporting the expansion of affordable housing. Others emerge as naturally occurring affordable housing (NOAH) designed and managed for long-term affordability. Examples of projects Truist has supported include:

Orlando - Hillpointe, LLC is an Orlando area workforce housing developer with extensive experience building attainable housing options for household incomes falling between 60% and 120% of the AMI. Hillpointe’s senior management team has developed and built more than 12,000 units of residential and multifamily housing, representing over $2,500,000,000 in asset value.

Hillpointe communities are made up primarily of two-bedroom, two-bath apartment homes with 1,170 square feet of living space. A construction loan from Truist helped finance their 288-unit garden-style workforce rental community, Pointe Grand Four Corners.

Atlanta - Atlantica Properties and EQ Housing Advisors developed an ambitious mixed-income housing initiative, The Lofts at Twenty25, that combined mission-oriented capital, private-market expertise, and public incentives.

The Lofts at Twenty25, originally named The Darlington, was constructed in 1951 and built for the working class—Atlanta’s first post-World War II high-rise. It later became a luxury apartment community, but under its new ownership is returning to its roots. Now 30% of the 623 units are designated for workforce housing, preserving affordability for tenants earning between 50% and 80% of Atlanta’s AMI.

A ground lease helps keep the property affordable for at least 25 years. The acquisition is Atlanta’s largest mixed-income public-private initiative to date, with public involvement through Atlanta Urban Development (AUD). Truist Community Capital and the Community Foundation for Greater Atlanta financed the acquisition.

Charlotte - Ascent Real Estate Capital assembled a NOAH project in the Charlotte area to address the loss of properties available for renters earning less than the AMI. The Lake Mist apartment complex is a two-story cluster of brick buildings located along a busy commercial corridor where rents increased by 34% over the past five years.

Ascent Real Estate Capital partnered with two prominent Charlotte investors and brought together mostly local organizations to build the Housing Impact Fund, a $58 million pool of money that included a $15 million investment from Truist Community Capital. The Fund specifically targeted properties like Lake Mist to preserve them as affordable housing. Ascent continues their efforts in Charlotte and has funded similar efforts in Charleston and Chattanooga.

Workforce housing projects need the right capital pieces to be in place and stress-tested to deliver the economics that investors, capital sources, and developers require for a successful project.

Banks like Truist can help align capital to realistic pro forma economics including senior debt, bridge-to-agency, construction financing, and permanent take-outs. They provide advice on optimal debt service coverage and reserves and look for ways to partner with housing authorities and workforce coalitions as economic partners.

Truist brings several unique capabilities to bear. Our National Commercial Real Estate team provides a full suite of banking services for private developers and investors assembling workforce projects. Truist Community Capital in conjunction with Grandbridge Real Estate Capital, a subsidiary of Trust, can help developers take advantage of the mix of agency programs, tax credits, CRA commitments, and local incentives to structure financing that can make these projects work. Agency programs include:

• Fannie Mae’s Sponsor Initiated Affordability (SIA) provides flexibility for owner/operator projects with reduced rents without the need to do income verification.
• The Freddie Mac Non-LIHTC Forward loan program for 20% affordable and 80% market mitigates interest rate risk.

Mission driven capital provides a source of financing that understands affordability needs and works to preserve workforce housing. Foundations and organizations looking for purpose or mission-driven investments provide these funds as do individuals seeking a social investment by accepting more limited returns on their projects.