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"Asset Management and the Survival of Nonprofit Owners"

Positive cash flow is critical to organizational health and sound asset management is the key to positive cash flow – and therefore survival – for nonprofit affordable housing providers, according to recent article in Affordable Housing Finance.

In “Asset Management and the Survival of Nonprofit Owners,” Harold Nassau, director of asset management programs for Neighborworks America, describes how the practice of asset management has evolved over the years as tax credit compliance periods near their end dates. He lays out seven challenges facing CDC portfolios and new developments: preservation, rising capitalization requirements, cost containment, energy management, operational sustainability of the service suite, outflowing cash, and the need to provide resident services.

The article includes four success stories, CDCs in Boston, Minneapolis, Washington, DC and the San Francisco Bay Area that found ways to manage costs and revenues effectively while maintaining quality properties. Nassau points out the common themes in these success stories and recommends “three deep changes” CDCs need to consider making to address the asset management challenges they face, including restructuring, growth and strengthening the core “back office” functions (e.g., financial, IT) that provide critical support to program and mission.

Read the article in its entirety here.

Posted in Housing Development and Preservation, Asset and Property Management

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