The Hidden Value in PHA Land: What Some Developers Don’t Want You to Know
- urbanuspartners25
- 4 hours ago
- 3 min read
In cities across the country, public housing authorities (PHAs) are entering partnerships to redevelop aging properties and build new affordable housing. These are important opportunities—but too often, they come at a cost that isn’t obvious until it’s too late. While there are many reputable development partners working with PHA's all over the country, there are just as many unscrupulous players looking to take advantage of PHAs that may not understand the intricacies of affordable housing development finance.
That cost is the under-valuation of public land assets.
As someone who’s worked in public housing development for over 25 years, I’ve seen the same story play out time and again: a developer approaches a PHA with a proposal. They highlight the funding they can bring to the table. They offer technical expertise. But when the deal closes, it’s the developer who walks away with long-term income and equity, while the PHA is left with limited control, limited returns, and limited leverage in the years ahead.
Here’s the truth: PHA-owned land is one of the most valuable assets in affordable housing finance today. It represents guaranteed access to location, zoning, and public purpose—things no developer can replicate or replace.
So why do so many PHAs get the short end of the deal?
Because the playing field isn’t level. Developers know the financial modeling. They understand how to structure deals that look appealing upfront but lock PHAs out of downstream benefits. And in the absence of strong internal capacity, many PHAs feel they have no choice but to accept what’s offered.
But there are alternatives. And there are strategies.
If you’re a PHA leader, here’s how you can start changing the equation:
1. Insist on “To be built” Land Valuations
Before entering any negotiation, get an appraisal of your land’s fair market value using multiple valuation methods including the “as if vacant” value and the “as if improved” value. Do not accept the “as-is” value of your land. The developer is using other people's money to increase the value of the land and you have every right to capture that value increase.
2. Understand Your Land Contribution as Equity
Land should be treated as equity in the deal. If you’re bringing a $5M land asset to the table, you should receive ownership shares proportionate to that contribution.
3. Demand a Return on Public Housing Funds Contributed to the Deal
Any Capital Fund, MTW, and especially Program Income used to make the deal work should bring additional leverage to the PHA. Even if those funds aren't paid back in cash the return should accrue and earn you additional leverage at year 15.
4. Negotiate Shared Cash Flow and Long-Term Revenue
Don't just focus on getting units rebuilt. Focus on cash flow, developer fees, and long-term income. These are streams of revenue that can sustain your agency for decades.
5. Build Internal Development Capacity
You don’t have to do it alone. But you also don’t need to give it all away. Invest in staff training and technical support so your team can participate fully in planning, oversight, and implementation.
6. Use Legal Counsel Who Works for You—Not the Developer
Bring in attorneys and financial advisors who represent the PHA’s interests exclusively. This ensures your deal structure and documents protect public assets first.
The public deserves better than extractive partnerships. PHAs can—and should—lead development efforts that are equitable, sustainable, and centered on community good.
At Urbanus Partners, we help PHAs reclaim their power at the negotiating table. Let’s make sure your agency gets what it truly deserves: not just rebuilt housing—but real ownership, control, and returns.
Want to explore how your land is being valued in current deals? Contact us today.