New Program Focuses On Accessory Dwelling Unit Growth In Atlanta

ATLANTA, GA — GROUNDFLOOR, a wealthtech platform that provides opportunities for people to build wealth through real estate, launched a new pilot program last week to spur the development of accessory dwelling units in Atlanta — and potentially offer more affordable rental options for the city, according to a news release.

Accessory dwelling units, or ADUs, are detached structures with a housing unit often built in back yards, and are allowed in certain areas of Atlanta with limitations. They are often used to provide extra income for a homeowner, new spaces for multigenerational living and more affordable rents that can mitigate gentrification, all while using existing space in growing communities, the release said.

The city of Atlanta's Housing Affordability Action Plan — which was unveiled last summer — includes ADU growth as a key component to opening up more affordable housing options with the current available space in Atlanta.

"ADUs are an innovative solution to meeting the high demand for constrained housing supply in metropolitan areas such as Atlanta, without adversely affecting the character of a neighborhood, in a way that directly benefits its residents," said Brian Dally, GROUNDFLOOR co-founder and CEO, in the news release. "This is the kind of social impact that the rising tide of directly-engaged individual investor capital promises as it disrupts big banks, private equity and Wall Street."

GROUNDFLOOR's new initiative is designed to support developers seeking financing for the renovation or new construction of ADUs, and enables investors to fund these projects through the company's platform, the release said.

Allowance for ADUs in Atlanta was expanded in several zoning categories in 2018, but implementation has been somewhat limited, according to Atlanta's city planning department. There has been a lot of interest in the development of ADUs by homeowners and developers in the city, but accessing financing for these projects has been a challenge, the department said on its website.

In its pilot program, GROUNDFLOOR has already funded three ADU projects — one in Adair Park, one in Venetian Hills and one in Sylvan Hills — with plans for several others, said Rich Pulido, GROUNDFLOOR's senior vice president of product and strategy. The company has funded $695,000 already, and at least $2 million in additional projects are being discussed, he said.

"With the announcement of our pilot program, we hope that other developers will turn to us for financing to spur additional growth," Pulido said.

GROUNDFLOOR provided Atlanta City Council members Andre Dickens and Matt Westmoreland with a preview of the program to obtain their feedback, Pulido said. Both council members were "very supportive" of the plans.

"Additionally, GROUNDFLOOR consulted with some of the architects directly involved in the formulation of the zoning changes related to ADUs and increased density," Pulido said.

The company has received applications and inquiries for other ADU projects in Atlanta, including a pocket neighborhood of duplexes, ADUs and guesthouses all in southwest Atlanta, Pulido said. Exact project details have not yet been released.

For more information on how to finance ADUs or other real estate projects through GROUNDFLOOR, visit its website.