Avanath Capital Management, a leading California-based affordable housing operator, is charting a bold new course in the face of a growing housing crisis. Traditionally known for acquiring and preserving aging apartment complexes to maintain affordable and workforce housing options, the company is now taking a proactive step toward solving one of the nation’s most pressing challenges: housing affordability.
Avanath Capital Management founder, Chairman and CEO Daryl Carter
As the shortage of affordable housing continues to plague urban centers, Avanath is turning to modular construction — a method where apartments are built in factories and assembled on-site. This pivot marks the company’s first foray into ground-up development, signaling a shift in strategy to address the overwhelming demand for affordable housing directly.
The Modular Advantage
Modular construction offers a host of benefits that align with Avanath’s mission. By leveraging factory-controlled environments, modular building can cut construction timelines by 30% to 50% compared to traditional methods. It also reduces material waste and labor costs, two critical factors in making housing more affordable.
“The housing crisis isn’t going to solve itself,” said Daryl J. Carter, founder, chairman, and CEO of Avanath. “We realized that to preserve affordability and ensure accessibility, we needed to step further into the supply chain and actually help create the supply.”
Carter also highlighted the environmental advantages of modular construction, noting that factory-built components produce less waste and have a smaller carbon footprint — a critical consideration as cities prioritize sustainability.
Avanath’s First Modular Project
The company’s first modular development will be in the heart of Atlanta, one of the fastest-growing metropolitan areas grappling with rising rents and housing shortages. The 150-unit apartment project will be constructed using prefabricated modules produced in a nearby factory to house low- to moderate-income families.
“We chose Atlanta for this pilot project because it embodies both the challenges and opportunities of urban housing today,” said Carter. “It’s a city with a dynamic economy but also a significant housing gap. We believe this project can set a new standard for what’s possible with modular construction.”
Addressing Housing Gaps
Avanath’s move comes as more affordable housing operators and developers are exploring modular construction to meet increasing demand. According to a recent report by the National Housing Alliance, the United States faces a deficit of over 7 million affordable rental homes for low-income families. Cities like Atlanta, Los Angeles, and New York are bearing the brunt of this crisis, with soaring land and labor costs making traditional construction unsustainable.
By adopting modular methods, Avanath hopes to address these barriers while maintaining its commitment to affordability. “This is not just about building units; it’s about building communities,” Carter added.
Scaling Up
Avanath plans to scale its modular housing efforts nationwide if the Atlanta project proves successful. The company is already in talks with modular manufacturers in California, Texas, and Florida to explore similar developments in other high-need areas.
While challenges remain — including navigating local building codes and overcoming misconceptions about modular housing — Avanath is confident in the potential of this approach. “Every innovation faces hurdles,” said Carter. “But the stakes are too high for us not to act.”
Industry Reactions
Experts in the affordable housing sector have applauded Avanath’s move, viewing it as a necessary step toward tackling the housing crisis. “Modular construction is one of the most promising solutions we have,” said Karen Johnson, a housing economist at the Urban Policy Institute. “Seeing a major player like Avanath embrace this approach is a signal that the industry is ready to evolve.”
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As cities continue to grapple with housing shortages, Avanath’s bold pivot could pave the way for broader adoption of modular construction in the affordable housing sector. For now, all eyes will be on Atlanta as the company breaks ground on its first modular project later this year.
CLICK HERE to read the entire National Affordable Housing article By Jarred Schenke, Atlanta
Gary Fleisher, The Modcoach, writes about the modular and offsite construction industry at Modular Home Source.
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