Working in the financial industry amid a pandemic revealed to J. Gabriel Smith hard-hitting issues he knew he wanted to help solve. It was during the pandemic's peak when Smith decided to create a larger, positive impact in the Charlotte area and beyond.
So, the former banker of 20 years became an entrepreneur.
Smith is now CEO and founder of HelioCasa Corp., a Charlotte-based company that seeks to build affordable, clean-energy rental homes. He had the idea to build these homes 10 years ago and officially launched the startup this past spring. To do so, Smith left his two-decade career as a vice president in corporate and investment banking in 2021 to follow his new path.
“I left really for a change of careers and to do something I felt was more meaningful,” Smith said. “I wanted to focus on something that had a greater impact beyond myself and my sphere of influence.”
HelioCasa’s mission
Smith is using his background in finance, technology and real estate to address two main issues he sees in the market: a lack of clean-energy sources and affordable housing in parts of America.
“Those are two key issues that are really driving me to build out this community,” he said.
In 2020, 30% of all households had unaffordable rent or mortgage payments, defined as exceeding 30% of monthly household income, according to Habitat for Humanity data. That's as U.S. home prices rose 20.6% in March 2022 from a year earlier while rent jumped 12%.
HelioCasa plans to partner with a manufacturing company that will produce thin-film solar products for the homes. Smith said the thinner products reduce installation costs and increase the amount of solar energy generated. That provides a more efficient way to install solar systems for the homes.
The startup will assemble the homes using modular construction and create small residential communities.
"We're working with a company that will build our designs where each panel of the home will be created in the factory, then shipped to the site and assembled on site," he said. "We will be using some third parties to do some of the assembly work. Part of the local vision is to hire some of the local resources in the area to provide jobs for them as well."
The company also plans to offer services within these communities such as health clinics, pharmacies, retail stores, daycare centers, training centers and more.
HelioCasa’s goal is to build the homes in a matter of weeks versus months. Integration of the solar panels will allow residents to have nearly zero energy costs, Smith said.
“Part of that system will be creating a smart, clean and efficient environment for residents to live,” he said. “Also, it will be a way to help support a clean climate focus to ensure that we are contributing to more of a clean-energy environment.”
Startup's plans for growth
Habitat’s data shows home construction surged in 2021 and 2022. However, it could take a decade of homebuilding to substantially increase affordability.
HelioCasa's initial plans call for building 500 clean-energy units in the Charlotte area. The company eventually expects to construct 10,000-plus homes in Georgia, Florida, Virginia and Maryland as additional target points. It aims to acquire a manufacturing company as well.
The target cost for building the homes is $70,000 to $80,000. Smith said he’s working with federal- and state-level agencies to ensure rent would be no more than 30% of the tenant’s annual gross income. If the market rate for rent is $1,000, his mission is to ensure that price drops to about $300 to make the homes affordable, he said. The renter will also be free of an electric bill, Smith added.
To fund the startup, Smith has a capital raise objective of $50 million, which he started in mid-August through registration with the U.S. Securities and Exchange Commission. It runs through April 2024. He plans to use the funds for land acquisition and fees, site prep and landscaping, unit manufacturing and leasing, and operating expenses.
HelioCasa is hoping to raise $5 million of its capital goal by the end of the year. The funding would initiate the first phase of development. That includes acquisition of targeted land, prepping the property, completing all permit steps and engaging with a contractor to build the first home structures. He looks to have the homes built within six to eight months after the initial portion of funding is raised.
The homes will most likely be townhouses featuring a minimum of two bedrooms and one-and-a-half bathrooms. Smith said the first clean-energy community would be in Charlotte, and he's also looking at properties closer to Greensboro.
