Dallas Company Targeting ‘Missing Intermediate Tenants’ Raises $50M in Pre-Funding

Dallas Company Targeting ‘Missing Intermediate Tenants’ Raises $50M in Pre-Funding
Dallas Company Targeting ‘Missing Intermediate Tenants’ Raises $50M in Pre-Funding

A Dallas-based business working to address a shortage of affordable rental housing has raised $50 million to jumpstart the development of 50 communities.

Homz, a housing company focused on sustainable, wellness-focused multifamily development, said it will use the money to form partnerships with secondary market leaders across the Southeast. The company hopes to utilize incentives to develop local communities at a lower cost.

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Courtesy of Homz

Each Homz community will feature 54 amenities, including clubhouses, pools, athletic fields, playgrounds, urban farms, Miyawaki forests and more.

“It’s no secret that there is a shortage of affordable housing in the United States, severely limiting choice and socioeconomic advancement,” Homz board member Kim Diamond said in a statement. “We are committed to changing this by delivering a uniform brand of sustainable, wellness-centric communities at attractive price points that people actually want – and can be proud – to live in.”

The pre-seed funding was led by Dallas-based Nanban Ventures, with additional contributions from family offices and high net worth individuals, according to a press release. Homz expects to invest between $140M and $170M in each community and to secure funding through the Department of Housing and Urban Development.

“Investing in Homz gives us an opportunity to help improve society and the livelihoods of many individuals and families without limiting our return potential,” said Nanban Ventures CEO and Managing Partner Gopala Krishnan. “We’re excited to see these communities come to life.”

Homz is modeled after the hospitality industry, which uses standardized franchise brands replicated across markets. When combined with incentives, Homz can create cost efficiencies in the housing space that mean lower rents, Diamond said Bisnow.

The company works with municipalities to acquire land either through the city itself or through landowners who want to utilize their property for the greater good, she added.

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Courtesy of Homz

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NJOY is one of four multifamily brands offered at Homz developments. It offers larger floor plans for rooms and families.

“By standardizing the design and layout of each community and saving on land acquisition costs, Homz is able to invest more in the communities while continuing to ensure that each unit is available at an attractive price,” Diamond said in an email.

Each community will have around 1,000 units evenly distributed across four multifamily brands aimed at catering to different stages of life. Larger units will be ideal for roommates and growing families, while others will cater to value seekers. Build-to-rent homes will also be included, according to the news release.

The development will primarily be aimed at “missing intermediate tenants,” Diamond said Bisnowor those whose primary options are typically Class B or C workforce housing with less access to desirable amenities, noting that there is a “flood of luxury and overpriced development” in markets across the country.

“Homz is committed to being a solution that addresses the affordability gap that has prevented individuals and families from finding a vibrant place to call home,” Diamond said in the email.

Pricing is still being finalized and will vary by market, and the number of units set aside for families earning below the area median income will be based on location and each city’s requests, Diamond said.

The company hopes to start its first projects by the end of this year.

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