Essential Housing Impact Partnership Acquires 90 Affordable Communities

The Michaels Organization (Michaels), the Urban Investment Group within Goldman Sachs Asset Management (Goldman Sachs), and the Community Development Trust (CDT) in a Joint Venture known as the Essential Housing Impact Partnership have completed the $1.2 billion acquisition of 90 affordable housing communities. 

The acquired portfolio consists of communities developed and rehabilitated primarily with federal Low-Income Housing Tax Credits, most of which are near or at the end of their required affordable initial compliance period. The acquisition of these communities ensures the long-term reinvestment and preservation of more than 10,000 apartment homes affordable to families and seniors with low and moderate incomes. 

"We are proud to be part of this joint venture designed to preserve these essential housing resources, ensuring they remain community assets for generations to come," said John J. O'Donnell, Chief Executive Officer of The Michaels Organization. "We're also excited to welcome both the residents and the teammates of these high-quality affordable housing communities to the Michaels family."

The properties, which were all acquired from Harmony Housing and managed by Greystone Property Management Corporation (GPMC), stretch across eight states — Florida, Illinois, Indiana, Kentucky, New York, South Carolina, Texas, and Wisconsin. All 90 communities acquired by the Essential Housing Impact Partnership will now be managed by Michaels. 

In a separate but related transaction, Michaels will also serve as the property manager for 31 communities, all in North Carolina, which have been acquired from Harmony Housing by Foresight, a non-profit organization dedicated to preserving affordable housing. Michaels has a long-standing relationship with Foresight and manages the majority of its affordable portfolio. The 31 acquired communities will add 1,923 affordable apartment homes to Foresight's portfolio.

"The Michaels Organization and Foresight are clearly aligned with both Harmony Housing and Greystone's mission to positively impact people's lives through the support of affordable housing. We are confident Michaels will continue the resident care and attention that's been a priority for Harmony Housing and GPMC," said Bob Barolak, president, Harmony Housing. "Harmony Housing will continue its strategy of growing and preserving a portfolio of high-quality affordable housing that can give back to the community, and we are proud of the immense impact we have made through resident services, resident and employee scholarships, and charitable donations that have been a result of the Harmony Housing portfolio strategy."

Michaels is the largest privately held owner of affordable housing in the country. The Urban Investment Group within Goldman Sachs Asset Management has been a pioneer in creating innovative capital solutions to address complex community challenges. Since its inception in 2001, it has focused on revitalizing underserved neighborhoods through affordable housing, small business lending and quality educational and healthcare facilities, financing the creation and preservation of over 53,000 housing units, 3 million square feet of community facility space and over 12 million square feet of office, retail and industrial space. Now in its 25th year, CDT provides long-term capital to support the preservation of affordable housing and other community developments with social impact throughout the United States

"By partnering with like-minded organizations in Michaels and UIG, we were able to assemble the critical resources needed to complete this major preservation transaction. Through this partnership, these properties will remain viable affordable communities — providing over 30,000 residents with quality affordable housing — for the long term," said Joseph F. Reilly, President and Chief Executive Officer of CDT. 

"We couldn't be more excited to partner with The Michael Organization and the Community Development Trust to preserve much-needed affordable housing across more than 10,000 apartment units," said Dan Alger, a Managing Director and co-head of the Urban Investment Group within Goldman Sachs Asset Management. "Goldman Sachs has invested over $17 billion to create positive social and financial returns and the acquisition of this portfolio exemplifies our team's mission-driven approach to investing. The preservation of high-quality, affordable housing has never been more important than it is today and the acquisition of this portfolio allows us to do just that - and to do it at scale, with a real focus on promoting positive outcomes for the residents in these communities."

As part of these acquisitions, both on-site and corporate employees of Greystone Property Management were invited to join Michaels.

Much of Michaels' growth as an organization has been the result of acquisitions during its 50 years as a multifamily developer, asset manager, and property manager. Most recently, Michaels acquired 1,500 affordable homes in Indiana and before that 15,000 of privatized military housing. With this latest transaction, Michaels is now managing more than 74,000 homes across 39 states.

The Harmony Housing acquisition was led by Michaels Vice President of Capital Markets Cristhian Codorniu, Vice President of Acquisitions Kunal Chothani, Vice President within Goldman Sachs Asset Management Alan Sage, and CDT Chief Business Development Officer Michael Lear. 

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