American Community Development Group, Inc. operates via a hybrid social business model. Founded by a group of experienced professional managers and principles, the company focuses on real estate investments that create affordable and transitional housing and job creation programs for the nonprofit community. Having positively affected hundreds of lives already, American Community Development plans to expand into other regional areas.
As a result of the recent recession, donations are down, government funding and programs are being cut, jobs have disappeared and housing markets are in turmoil. Furthermore, banks in general have cut back on traditional lending and changed their loan criteria and terms. Many nonprofits are consolidating, closing programs, reducing their mission size or services and some are just shutting their doors.
This environment has called for innovative strategies and immediate changes to address these challenges. Through strategic services, American Community Development helps other organizations build or acquire companies to increase revenue, receive financing for properties and programs, develop new grant avenues and relationships, add depth and specific skills, and help with the consolidation of likeminded entities to reduce expenses and increase service levels.
In the real estate industry, American Community Development purchases and manages rental properties. Specifically seeking opportunities in the $20,000 to $40,000 per rental space price range, the company is able to offer an affordable housing program to house the tenants of nonprofit associates. Because there is a virtually unlimited supply of tenants waiting for such housing, property cash flow can exceed 20% the normal rate and rental income is usually guaranteed by the nonprofit service provider.
Yesterday, the company announced that it is adding six existing transitional housing properties to its portfolio. When fully occupied, base revenue could potentially climb 40%. The management team plans to aggressively integrate the new properties with existing operations to add more growth in capacity over the next six to eighteen months. In the same press release, American Community Development also indicated that it is receiving inquiries for assistance in continued development of transitional housing.
John Folger, President of American Community Development Group, stated, “We are currently acquiring interests in single and multi-family homes, apartment buildings, and other high occupancy commercial real estate properties, all while helping members of our community. This approach sits well with both the community and our shareholders because we work directly with the nonprofit community and government agencies to house their clients. This model keeps our properties fully occupied.”
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