Costello Companies: Partners from Day 1
When SDHDA was created, Costello Companies was already a third-generation firm that was a pioneer in affordable housing. "We started working with South Dakota Housing from day 1," said Tom Costello III. Tom and his brother Dan are the fourth generation of Costellos operating the Sioux Falls-based family business. "We remain absolutely focused on affordable housing," stated Tom.
Costello Companies was started by John Costello, who owned a furniture business in Sioux Falls. In the 1920s and early 1930s, John ventured into real estate by developing and building eight houses in the Sioux Falls area. His son Tom also worked in real estate. Tom was South Dakota's first Federal Housing Administration approved loan broker.
John's grandson, Thomas P. Costello, quickly saw the need for subsidized housing for low-income families. In the 1960s he was the first developer in the area to offer subsidized housing. He worked with the Department of Housing and Urban Development and the Department of Agriculture's Rural Development program (formerly FmHA).
In the late 1980s, his sons Tom and Dan were among the first developers to partner with SDHDA, using the Housing Tax Credit (HTC) program. Over the years they have developed 75 HTC properties.
The brothers have also branched out into fee-based property management, apartment development, construction and compliance work for HTC and HOME funded projects, continuing to advance the cause of affordable housing.
Tom Costello said developing housing projects can be extremely complex, especially when private investment, bank financing and more than one federal program is involved. "It takes many partners to make these things work. The banks, the owners, SDHDA. There are a lot of parts that have to fit. And they have to fit right," commented Tom.