Pro Formas, Policy, and Pathways to Interim Housing
On Tuesday, May 28, HAC’s Regulatory Committee hosted an illuminating session featuring JP Walsh of Panoramic Interests and Elizabeth Funk of DignityMoves, offering a dynamic deep dive into two key dimensions of California’s housing response: development finance and innovative interim housing.
The Economics of Housing: Demystifying the Pro Forma
JP Walsh, Director of Acquisitions at Panoramic Interests, guided attendees through the mechanics of a real estate pro forma, demystifying how developers calculate projected income, expenses, and operating income to assess project feasibility.
Inside the Developer’s Toolkit
Walsh emphasized that every housing project is ultimately shaped by numbers, and walking through a sample pro forma illustrated just how narrow the margins can be for new development—particularly affordable housing. Revenue drivers like rent assumptions and market comps are only one part of the equation.
Operating costs, including maintenance, property taxes, and reserves, often exceed expectations. Financing assumptions—such as interest rates and required returns—are what ultimately dictate whether a project pencils. He highlighted that even modest increases in construction costs or delays in permitting can make or break a deal, reinforcing the need for policy environments that reduce uncertainty and speed timelines.
Walsh’s key takeaway? “Understanding how the numbers work is crucial for anyone advocating for faster, more affordable housing—because even mission-driven developers can’t build at a loss.”
Building with Dignity: Interim Housing as a Scalable Solution
Elizabeth Funk, CEO of DignityMoves, shared the remarkable growth and impact of her organization’s work providing dignified, private interim housing across California—highlighted in their newly released 2024 Impact Report .
From Emergency to Innovation
Funk described how DignityMoves harnesses modular design, flexible zoning, and public-private partnerships to rapidly deploy cost-effective interim housing with supportive services: Seven operational communities now serve 855 residents—with nine more in development.
Projects like Hope Village (Santa Maria) and La Posada (Santa Barbara) demonstrate the power of using underutilized land and philanthropic capital to scale quickly. DignityMoves raised $24M in private philanthropy and unlocked $126M in public funds—a compelling case for blending funding sources.
Beyond Shelter—Toward Functional Zero
Funk emphasized that interim housing is a critical rung on the ladder out of homelessness, bridging the gap between street and permanent housing. With support from bills like SB 606 (The Functional Zero Unsheltered Act), DignityMoves is part of a broader shift urging municipalities to adopt “all-in” approaches that treat interim housing as essential infrastructure.
“Our streets should not be the waiting room,” Funk declared—calling on policymakers to embrace speed, scale, and dignity.
What’s Next
The discussion spotlighted a crucial intersection: economic feasibility and moral urgency. With deepening understanding of development math and inspiring models for scalable interim solutions, HAC members are better positioned to drive bold, informed housing policy.
Stay tuned for the next RegComm session—and join us in building the momentum toward housing for all.
