More than 2,000 leading affordable housing developers, lenders, and deal partners gathered at AHF Live in Chicago.
Key topics discussed included how the industry will adopt the recent low-income housing tax credit (LIHTC) program changes enacted by the One Big Beautiful Bill, ways to increase net operating income, and more.
- State of the Industry
Industry leaders voiced cautious optimism during the State of the Industry Power Panel, providing an outlook and some calls to action for attendees.
“I’d describe the landscape as evolving, and we’re all adapting,” said Priya Jayachandran, president and CEO of the National Housing Trust.
On the policy side, Bob Moss, partner and co-founder of MG Housing Strategies, highlighted significant federal momentum behind the Senate’s Road to Housing Act, including the proposed increase in the Public Welfare Investment cap, which could unlock addition LIHTC equity. However, he cautioned that rental assistance and key Department of Housing and Urban Development (HUD) programs remain at risk.
Rob Likes, president of KeyBank Community Development Lending & Investment, broke down the financing environment. Construction, bridge, and permanent financing remain widely available, but equity continues to be the constraining factor heading into 2026. “Debt is plentiful. Equity is the challenge—especially as banks hit their limits,” he said.
The developers discussed the strain caused by longer closing timeliens, escalating costs, and underwriting gaps. “Time is the enemy,” said Gilbert Winn, CEO of WinnCompanies. “A two-year delay can erase an entire equity structure.”
Ken Lombard, president and CEO of BRIDGE Housing, concluded by urging the industry to be willing to change, modernize business practices, and adopt new strategies—not cling to old playbooks.
- Capitol Hill Update
Emily Cadik, CEO of the Affordable Housing Tax Credit Coalition, started the annual Capitol Hill Update by thanking industry stakeholders for helping get the LIHTC expansion in the One Big Beautiful Bill and highlighting some of the other positives on the housing front during uncertain times.
“From an advocacy perspective, we've been here every year talking about the importance of site visits and getting out and reaching out to your members of Congress. Even though we spend our time advocating in Washington, D.C., we wouldn't be able to do this without all of you,” she said. “Even as we talk about some of the challenges, it's really important to reflect on this—the huge achievement we have and also the momentum we've seen since then. I think we're finally starting to see some of this long overdue action on affordable housing that has been many years in the making.”
The Capitol Hill panel pointed to the ROAD to Housing Act, which passed the Senate in October as part of its version of the National Defense Authorization Act. Chairman Tim Scott (R-S.C.) and ranking member Elizabeth Warren (D-Mass.) led the Senate Banking Committee in its first bipartisan housing markup in over a decade, with it including 40 key housing provisions from every member of the committee to help boost supply and reduce regulations. House Reps. Mike Flood (R-Neb.) and Emanuel Cleaver (D-Mo.) have introduced the HOME Reform Act, which would make substantial changes to the eligible uses and exemptions applying to the HOME Investment Partnerships program.
“All of these things are real examples of how Congress does work together behind the scenes. and housing is really such a bipartisan issue at this point,” noted David Gasson, partner and co-founder of MG Housing Strategies.
The Affordable Housing Credit Improvement Act also is expected to be reworked and reintroduced with the next Congress with a renewed focus on rural and extremely low-income basis boosts and other fixes for casualty loss treatment, qualified census tract limits, and outdated technical provisions.
- Developer Advice
AHF 50 developers outlined some of the risks they are seeing as well as their strategies moving forward.
Carmen Chubb, president and principal of Columbia Residential, said it’s important to be aware of cuts to federal housing programs, what the priorities and changes are at the state housing finance agencies, and the trickle down from the federal government affecting public housing authorities. “It’s nothing new to the development community that you have to be nimble and problem-solve, but it seems very acute in an environment with so many changes happening at once,” she said. “How are we navigating? We’re just being nimble. When one door closes, we look to open another door, find another source, find another interested funding partner to fill the gaps, and we’ve been able to do that.”
Jesse Elton called the environment a new normal, where financing gaps are larger in terms of dollar amount and the resources are more limited. This is being compounded by an equity market that hasn’t been as reliable as the industry has been accustomed to.
“We have felt it behooves us to have multiple equity relationships that we can call upon in different markets and at different times. We have to be a little more thoughtful about where we’re going to find the pricing and equity availability,” she noted.
- The 4% Bond Test
The One Big Beautiful Bill (OBBB) included a reduction in the bond financing threshold test from 50% to 25% beginning next year, opening the door for more 4% low-income housing tax credit and bond deals to be funded. However, a lot of states won’t immediately go down to 25%, with developers possibly seeing 50% continuing in some states. California is an early state in modeling the potential for a 25% bond test, according to bond attorney Wade Norris of Dinsmore & Shohl.
State housing finance agency (HFA) leaders emphasized that they are carefully looking at strategies to implement the change in the bond test and utilize a 12% increase in LIHTC allocations next year. Florida Housing is trying to find the right balance of innovation and efficiency, said Marisa Button, managing director of strategic initiatives at the agency. Other states have been eyeing reducing the bond test next year but not all the way to 25%.
- Equity Market Changes
Be prepared and position your project to withstand different hurdles that may come up as a result of the changes from the OBBB, according to LIHTC syndicators. With the 50% bond test threshold going down to 25%, there will be more deals in the market, yet there’s still the same number of management companies, consultants, people at the state housing agencies and syndication firms, noted Laura Surdel, senior managing director, equity production, at Boston Financial. “Expect it will take some time for all of these new ideas and more deals to come into the market and to be accepted,” she said. “But, I think, once the market can absorb that, it will be such a great thing for the industry. Twenty-three states were constrained by their bond cap, and with the reduction in the 25% test, we will see more deals in those states.”
There’s more focus on sponsors at this time, and real estate owned schedules are important, added Lisa Gutierrez, senior vice president, director of business development, at U.S. Bancorp Impact Finance. “Sponsorship is really key right now and making sure that you can operate not only what you have but what you have in your pipeline,” she said.
- Ways to Boost NOI
You should be managing net operating income (NOI) from day one of a project, even before residents begin moving in, according to developers Karla Burck, executive vice president of development at KCG Cos., and Richelle Patton, president of Collaborative Housing Solutions. Design, tenant selection plan, social services, and an eviction process are among the areas that should be discussed early on to ensure a strong project. Managing property taxes and insurance are also important areas for NOI. With counties having different ways of assessing valuations, a good consultant can be help in staying on top of tax appeals, said Patton. Looking at potential utility allowances for each development has also been a good practice at KCG, according to Burck. The developers also brought up the importance of a property’s online reputation. When residents have a positive experience at a development, encourage them to leave a review.
- Everyone Has a Story
“My hope for you all while you are here is that you will be able to share some stories and listen to others. I hope that your opportunities to listen in this conference cause you to walk away from your time here seeing some footprints that you are leaving and some marks you are making and that you are filled with compassion, more compassion than you can ever hold. I hope that you know above anything else that everyone’s story is priceless.”—Stephanie Land, author of “Maid: Hard Work, Low Pay, and a Mother’s Will to Survive” and keynote presenter at AHF Live.
- Rising Expenses
Income for affordable housing units has grown 32% while total operating expenses have grown 38% since 2019, revealed Jeff Adler, vice president of Yardi Matrix during his affordable housing outlook at AHF Live.
- Embracing the Future of AI and Affordable Housing
Stephanie Roberts, vice president of operations at CAPREIT, and Kimberly Black King, founder and CEO of The Grundy Cause, took a deep dive into how artificial intelligence (AI) is moving into practice for affordable housing owners, developers, and operators.
“Market-rate has had a lot of investment in tech. Affordable has not,” Roberts told the audience. “I felt like we were behind, and AI is how we start to close that gap for our residents and staff.” She shared how AI-powered tools can improve efficiencies for residents and on-site staff when it comes to required application and recertification forms as well as providing detailed and easy-to-read summaries for lengthy regulatory agreements.
Black King noted affordable housing developments in the pipeline today may be delivered into a world in several years where artificial general intelligence exists or is close, impacting design decisions and resident expectations. “Our job is to make sure AI becomes a tool that expands what we can do for residents—instead of something that catches our projects and our people unprepared,” she added.
- Elevating the Residents
Donovan Duncan, executive vice president and chief operating officer at Urban Strategies, says the term resident services needs to evolve.
“I think we need to rename the industry because what we do as an organization is not resident services. We liberate hope, we leverage results, we connect communities, and we believe in people. We are the pulse of the industry. So, this is an opportunity to reimagine and reflect.”