South Florida-based Affiliated Development has closed on $50 million in financing and started construction on the firm’s newest multifamily development project in West Palm Beach, The Spruce.
Located in the heart of Northwood Village off Spruce Ave between 24th and 25th street, The Spruce is walking distance to Northwood’s retail complexes, shopping, dining, and entertainment venues. Fit with luxury finishes, features and amenities, including a roof top pool with unimpeded views of the intracoastal, the 8-story mid-rise building will offer 270 one, two and three-bedroom apartments, many at workforce level rents.
The Spruce celebrates a successful collaboration between public and private entities to address both redevelopment and housing. In April 2023, the West Palm Beach CRA and City of West Palm Beach awarded the developer $2.5 million in funding incentives and $5.1 million in tax increment financing to bridge the funding gap and help finance the project. Affiliated also participated in the Palm Beach County Workforce Housing Exchange program by partnering with two publicly traded Homebuilders to absorb their workforce housing requirements. A philanthropic grant was also secured to subsidize the construction of additional affordable units.
In addition to the funding incentives, the Spruce was capitalized by a $50 million first mortgage from the Bank of Montreal and an equity investment from Affiliated Housing Impact Fund, LP and a private family office. The original property owner, Grace Development, is also an investor in the project.
“It takes creative solutions to address the housing crisis, especially given the current cost and interest rate environment,” says Nick Rojo, Co-Founder of Affiliated Development. “We took a unique approach and combined philanthropy with private capital and local incentives. Given the influx of wealth to South Florida, we believe philanthropy will play a larger role in housing and we plan on utilizing philanthropy on future projects.”
“The City of West Palm Beach leadership, along with Palm Beach County, have prioritized the creation of quality workforce housing and recognize how important this type of housing is to the growth of the city and region,” says Jeff Burns, Co-Founder of Affiliated Development. “This is yet another prime example of how private and public entities can come together to tackle tough issues.”
In January 2020, Mayor Keith James announced the launch of the “300 in 3” Vision for Workforce/Affordable Housing. This initiative, implemented by the city’s Housing and Community Development Department, aimed to create 300 workforce and/or affordable housing units in West Palm Beach by 2023. Mayor James has since increased that goal to “1,400 in 8”, hoping to add 1,400 units of workforce housing for the city’s residents during his tenure as Mayor.
“I am delighted to hear about this milestone achieved by Affiliated Development,” says Mayor Keith James. “I applaud the developers for their creative approach to obtaining the funds to make their vision a reality. I am thrilled because this project significantly contributes to my goal of creating 1400 units of affordable housing during my 8 years in office. Congratulations to Affiliated Development.”
The Spruce is being constructed by Verdex Construction, a West Palm Beach-based general contractor, and was designed by the firm’s in-house architecture firm A+R, an affiliate of Fort Lauderdale-based Rinka+.
Affiliated Development is the most active workforce housing developer is South Florida and has completed several similar projects in Palm Beach County, in addition to Broward and Miami-Dade. Earlier this year, Affiliated Development was recognized by The Housing Leadership Council as the For-Profit Developer of the Year. Affiliated Development capitalizes projects like The Spruce through their partnership with several local public pension plans that invest in the firm’s strategy in an effort to tackle the region’s workforce housing crisis.
Affiliated Development (“Affiliated”) is a regional real estate development and investment company headquartered in Fort Lauderdale, Florida with offices in West Palm Beach, FL. Affiliated specializes in mixed-use multifamily ground-up development and has created a niche in working with local government to help bring about redevelopment and construct workforce housing. The company was formed as a mission-based organization with the goal of building mixed-use multifamily developments to target unmet demand and underserved areas within the market. Affiliated works directly with communities to improve the quality and sustainability of housing stock for residents, resulting in the development of Class A luxury apartments at attainable rates.
