He wrote key reports on Seattle-area homelessness. Now he’s building low-income housing.

Seattle has been looking for ways to solve the homelessness crisis for years. A local developer is out to show he has the answer.

“The problem simply defined is the lack of housing generally and a lack of affordable housing specifically. It really is as simple as that,” says Ben Maritz, managing member of Great Expectations, a for-profit developer of some of the most affordable housing around.

ANTHONY BOLANTE | PSBJ

Ben Maritz was among the McKinsey & Co. employees who studied how much it would cost to end homelessness in King County.

He was among the McKinsey & Co.
employees who studied how much it would cost to end homelessness in King County. The latest estimate from a 2020 study: an additional $450 million to $1.1 billion per year for the next 10 years.

Before jumping in with both feet, Maritz said he had dabbled in real estate investing — buying and rehabbing small multifamily housing and “raising the rent and making money.” He concluded this

business model is part of the problem because “you’re raising the rent on people who can’t afford it.”

Maritz and his nine employees, including two recent refugees from Afghanistan, operate 410 ultra low-income apartments in seven buildings between Seattle and Portland, and the company’s pipeline holds around 600 units, including a new project in Spokane.

The goal of Great Expectations is to provide below-market rents for residents and above-market returns for investors.

“Our vision is that other people will copy us,” Maritz says. “When they see that we’re able to make money by providing socially positive, inclusive housing they will replicate our model and ramp it up much, much faster than we could ever do on our own.”

About Ben Maritz, managing member of Great Expectations

Previous: Fifteen years at McKinsey & Co., working around the world before returning to Seattle to co-lead the Pacific Northwest office

Education: Bachelor’s in computer science and economics and master’s in mathematical science, Johns Hopkins University; MBA, Stanford University

Born: United Kingdom Residence: Capitol Hill Family: Wife and four children

A day in the life

7:20 a.m.: Wakes up
7:30 a.m.: Takes the kids to school 8:15 a.m.: Arrives at the office Morning: Meets with staff

Noon: 90-minute meetings with owners, architects and contractors on-site

1:30 p.m.: Works on new projects
5:30 p.m.: Tries to go to the gym
7 p.m.: Dinner with family and bedtime stories Midnight: Bedtime

What did you do at McKinsey? My specialty was restructuring large capital projects. I worked in mining and spent a large portion of my career in gold, copper, iron ore and diamond mines around the world. I’ve been north of the Arctic Circle, to the southern tip of New Zealand, Ghana and the middle of nowhere In Australia. They don’t put the resources in easy-to-get-to places anymore.

Why did you return to Seattle and what did you do here? While we were in Japan we had two more kids. It was time to come back home. The most interesting thing was some essentially pro bono work on homelessness and housing. We did a few studies that among other things led to the creation of the new King County Regional Homelessness Authority.

How many investors do you have and what returns are you offering? We’re close to 100 and we are targeting 15% IRR (internal rate of return) over a 10-year hold period. Our developments are almost all in designated federal opportunity zones, which means that the return is largely tax-free. That we have this social mission behind it, I think, makes it very attractive for investors.

What are the lowest rent and highest rent Great Expectations charges? It ranges from $817 for a micro-unit of 166 square feet with a shared kitchen in the Central Area to $1,063 at a Portage Bay neighborhood building where units average 309 square feet.

It’s now illegal in Seattle to develop micro-apartments because they’re considered too small. Thoughts? I think it’s a really dangerous imposition of upper-middle-class values on people that just want a clean, quiet place to live and who aren’t concerned about the size of it. Our buildings are 100% occupied. You can’t tell me that people don’t want to live there.

Can you build micro-units anywhere in Great Expectations’ market area? Yes and no. The biggest barrier is city parking requirements. The exceptions are places like Portland, where we

have two buildings, and Tacoma, where we’re building a 199-unit building. Unit sizes in Tacoma are a little bit bigger, averaging 376 square feet. Banks and investors aren’t quite ready to finance true micro-housing in those markets yet.

Do you think Seattle will allow micro-housing development again?

I believe so. I have not had any hinting conversations with elected leaders, but I think that Mayor (Bruce) Harrell is very committed to addressing homelessness. The people who live in our buildings are the population who are at risk of homelessness. A very large number have experienced homelessness.

Does that require more intense property management?

Absolutely. We have an employee who has a background in social work. Her role is to coordinate all of the assistance that’s available.

How did you end up hiring refugees from Afghanistan? I organized a group of other landlords to get connected with the agency that was resettling them. We personally only had three because we had no vacancies at the time. Two now work in our maintenance department doing groundskeeping. Hiring refugees was not part of my motivation to house them, although it has worked out very well for everybody.