PatJackson

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The shortage of workforce and affordable housing has become anational crisis—not only an issue in major metros and primarymarkets. With limited supply and rising demand, national lenderSabal Capital Partners sees an opportunity toaddress the housing crisis in secondary and tertiary markets. Asthe economy continues to grow, demand will increase for thishousing segment, and in a downturn, demand will increase as peopleseek a lower cost of living.

"There is a workforce housing shortage in every market inAmerica. People think that this is a big city issue, but thereality is that this is an issue in secondary and tertiary marketsjust as much as it is a primary market," PatJackson, president and CEO of Sabal Capital Partners,tells GlobeSt.com. "As the economy continues to grow, there has notbeen enough workforce housing coming into the marketplace. You seea lot of growth in class-A and A+ markets, but you don't see anynew supply in places where workers can live and raise a family.That has been exacerbated by a limited availability of starterhomes and the difficulties to secure a loan as well as the numberof people that would rather rent. It is putting a lot of pressureon workforce housing supply everywhere."

While there is demand for workforce housing across the nation,Sabal likes the secondary and tertiary markets because they offerbetter cap rates and pricing than primary market. "We likesecondary and tertiary markets because we haven't seen cap ratescome down the way that they have in primary markets like SanFrancisco and New York," says Jackson. "That makes these markets agood investment in relative terms around a supply-constrainedproduct with a lot of demand."