A Primer on Workforce Housing
Where You Live Matters
ABOUT THE NHP FOUNDATION Headquartered in New York City with offices in Washington, DC, and Chicago, IL, The NHP Foundation (NHPF) was launched on January 30, 1989, as a publicly supported 501(c) (3) not-for-profit real estate corporation. NHPF is dedicated to preserving and creating sustainable, service- enriched multifamily housing that is both affordable to low and moderate income families and seniors, and beneficial to their communities. Through Family-Centered Coaching, NHPF’s subsidiary Operation Pathways engages with, and assists, families experiencing poverty and other hardship, to problem-solve together. Through partnerships with major financial institutions, the public sector, faith- based initiatives, and other not-for-profit organizations, NHPF has 65 properties, including approximately 10,000 units, in 16 states and the District of Columbia.
A Primer on Workforce Housing
Workforce housing ensures that earners of moderate to middle income—essential workers who make communities run, like teachers, police officers, retail and hospitality workers—can afford to live in the communities where they work. This is especially important in regions with high housing costs and a large proportion of second or vacation homes that exacerbate local housing shortages. This primer is an overview of workforce housing, why it matters, and strategies and tactics that have proven successful in developing and preserving it. Also included is a real-world example of how one not-for-profit housing developer, The NHP Foundation (NHPF), is entering the challenging Colorado mountain resort region to build much-needed workforce housing.
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What Is Workforce Housing?
Workforce housing is typically available for households earning between 60% and 120% of the Area Median Income (AMI). It is designed for those whose essential work supports the local economy but whose incomes are not high enough to afford the prevailing market-rate rental or homeownership costs. Workforce housing improves communities in a number of ways. When local employees can live near their workplaces, commutes decrease, civic engagement rises, and local businesses benefit from a stable workforce. Stable housing is economic development. Essential workers—teachers, nurses, retail employees, police officers—provide services that keep a community running smoothly. Attracting and retaining these workers ensures a robust local economy. Workforce housing helps prevent communities from becoming enclaves of only the highest earners or second-home owners, providing diversity that enriches community culture. COMMON CHALLENGES Because it is still below-market in some communities, workforce or middle income housing faces many of the same challenges faced by housing for people of lower incomes. These include: • H igh Development Costs & Limited Land Mountain resort towns and coastal areas often have extremely high land values, high rents, and limited buildable sites. • R estrictive Zoning & Anti-Density Sentiment Zoning laws, reinforced by long-held community beliefs, may limit density, complicating efforts to build the quantity and type of housing units needed. • Community Misconceptions “Affordable housing” can carry a stigma, leading to misunderstandings or resistance from local residents, and businesses. • Infrastructure & Climate Constraints In regions with cold climates and fire/flood zones, building costs rise due to stringent weatherproofing requirements and high insurance costs. Importantly, this type of housing also lacks a dedicated subsidy. Unlike more “traditional” affordable housing for lower income households (such as those earning below 60% AMI), workforce housing is still a relatively new concept in many communities and lacks dedicated sources of subsidy. While Low Income Housing Tax Credits spur millions of dollars of investment in housing for people earning below 60% AMI across the U.S., this large source of funds is not available for projects serving households in the Workforce Housing range. Colorado is the first state to offer Middle Income Housing Tax Credits to help address this funding issue and is also dedicating a substantial portion of state funds to affordable housing for moderate income residents. Other communities are also considering creating dedicated funding sources as housing costs continue to rise.
Workforce housing
helps prevent communities from becoming enclaves of only the highest earners or second-home owners, providing diversity that enriches community culture.
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Recommendations for Developing Workforce Housing
GET AHEAD OF ANY WORKFORCE HOUSING PROPOSAL • E ngage Experts & Stakeholders Early Bring together representatives from employers, health care, housing, education, philanthropy, social justice, and government. • H ost Educational Series Offer in-person workshops or webinars that explain affordable/workforce housing 101, demonstrate local housing market studies and need analyses, and discuss the importance and value of providing housing to essential workers Informed residents and local decision-makers are more receptive to proposals; clarifying the broad benefits of workforce housing helps cultivate community support. MEET THE COMMUNITY WHERE THEY ARE • H ire a Community Engagement Partner Employ partners who understand the neighborhood’s history and sensitivities. • E ngage Community Leaders Make an effort to get acquainted with and gain support from council members, housing authorities and other key decision-makers in the towns you are looking to create workforce housing • Acknowledge Challenges During live feedback sessions, position workforce housing as part of a long-term solution rather than a new disruption. By incorporating resident input into revitalization plans, project teams build trust and secure buy-in for inclusive housing developments.
PEOPLE FIRST! • Personalize the Issue
Emphasize who stands to benefit from workforce housing—those employees who keep a community thriving. Lack of housing affordable to essential workers affects residents across the community as businesses struggle to keep employees. From the local coffee shop closing to a favorite teacher having to live out of their car to a lack of snowplow drivers to clear the roads, even higher income residents may recognize that a lack of workforce housing has affected their daily lives. • A ddress Common Misconceptions Clarify what workforce housing is—and is not—to counter fears of declining property values or increased crime. Focusing on real people and local needs helps move mixed-income developments forward even in areas of initial opposition.
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USE THE MEDIA • G et to know the local media who cover housing Invite them to events, conduct one-on-one interviews or background sessions, send press releases, etc. • Consider advertising Traditional—newspaper, radio, mailers and Social Media advertising, targeted to specific communities Positive, targeted and frequent messaging delivered as both earned media and advertising has been shown to move the needle on many community-oriented issues THREE ADDITIONAL PRINCIPLES 1. Language Matters Use inclusive, positive language. Workforce housing is very specific and communicating with the same, consistent language helps inform a community. 2. Design Matters Good design that fits neighborhood character can alleviate concerns about aesthetics and property values. 3. C ommunity Engagement Matters Consistent, transparent dialogue with stakeholders—from conception through completion— fosters trust and cooperation.
Workforce housing is vital for the sustainability of communities, particularly in regions with severe housing cost pressures
and high numbers of second homes.
Real-World Example: The NHP Foundation in Colorado
Based on its success in the Houston market with workforce housing at two mixed income properties that enable essential employees to live in the community where they work, NHPF is expanding into the Colorado mountain resort region. Despite high construction costs, limited land, and restrictive zoning, NHPF is advancing projects to bring workforce housing to high- need areas. Frisco, located in Summit County, serves as a gateway town to major ski destinations. However, it faces significant housing challenges, including a limited housing supply and a high incidence of vehicular homelessness. To address these issues, one key housing project is underway: Galena Apartments: Town-Led Housing for the Workforce The Town of Frisco is working on a significant housing initiative at Galena Street, where NHPF is assisting in redeveloping a town-owned parcel into long-term, income-restricted housing. This new energy-efficient building will include 54 units, for middle income households, with some units specifically designated for municipal workers. A major factor contributing to the success of this project is the strong support from the local government. The Town of Frisco has taken proactive steps by creating its own housing authority, which allows it to grant property tax exemptions for these sites and provide
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substantial financial backing. In addition, zoning code amendments have been enacted to permit greater building height and density, expediting the permit review process and encouraging developers to invest in more affordable housing. This project represents a strategic effort to increase workforce and affordable housing options in Frisco while fostering a supportive environment for residents and the workforce alike.
Key Takeaways and Recommendations
• E arly and Frequent Engagement Proactively educate and involve community members, dispel myths, and show the local benefits of workforce housing. • Tailored Messaging Use inclusive terminology and real-life examples of how essential workers benefit. • C reative Funding & Zoning Solutions From local tax credits to zoning code adjustments, combining incentives and flexible guidelines helps expedite workforce housing. • H olistic Design & Development Thoughtful design can make new developments more palatable, and integrating services (like mental health offices or daycare) can fulfill broader community needs. • Long-Term Commitment Workforce housing is rarely a quick fix. Success depends on phased developments, reliable financing, strong partnerships, and trust-building with the community.
Conclusion
Workforce housing is vital for the sustainability of communities, particularly in regions with severe housing cost pressures and high numbers of second homes. While housing for middle income households and workers may be delivered by the market in many communities, resort towns and coastal areas with a high cost of living often need support to create housing for people between 60% and 120% of the area median income. By combining strong community outreach with strategic partnerships, workforce housing can be expanded to meet the needs of teachers, first responders, retail workers, and other essential workers.
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MISSION The NHP Foundation is a not-for-profit real estate organization dedicated to preserving and creating sustainable, service-enriched multifamily housing that is both affordable to low and moderate income families and seniors, and beneficial to their communities. VISION A future where communities flourish because attractive, sustainable housing options and life- enhancing services are ensured for income- challenged Americans. VALUES NHPF seeks to promote greater diversity, inclusion, racial equity, and social justice in addition to its long- established mission of providing sustainable, service-enriched affordable housing. NHPF is committed to increasing access to opportunities for historically underrepresented individuals and businesses in the development and operation of affordable housing communities.
NEW YORK HEADQUARTERS 122 EAST 42ND STREET, SUITE 4900, NEW YORK, NY 10168 WASHINGTON, DC 1401 H STREET, NW, SUITE 1000, WASHINGTON, DC 20005 CHICAGO 159 N SANGAMON STREET, SUITES 200 & 300, CHICAGO, IL 60607 BALTIMORE 1501 ST. PAUL STREET, SUITE 128, BALTIMORE, MD 21202 nhpfoundation.org
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