When affordable housing developer NeighborWorks Southern New Hampshire embarked on its latest project – an affordable housing development in Nashua – it should have been familiar territory.

The development is slated to hold 45 one- to two-bedroom units. Just three years ago, NeighborWorks, a nonprofit based in Manchester, completed a similar project in Merrimack: 45 two- and three-bedroom units.

But construction costs and material shortages have exploded since 2019, and the environment for developers has changed significantly. This year, the Nashua development is expected to be 40 percent more expensive than the Merrimack complex, despite featuring smaller units, according to Robert Tourigny, executive director of NeighborWorks.