On September 22, 2016, the US Treasury Department announced through the CDFI Fund that Community Housing Capital (CHC) was among 23 Community Development Financial Institutions (CDFIs) to receive an award from the 2016 Capital Magnet Fund. The $3,750,000 award will be used to help finance the development and preservation of affordable housing for low- to extremely low-income families.
The Capital Magnet Fund provides competitively awarded equity grants to CDFIs and qualified nonprofit housing organizations to develop, rehabilitate, preserve, and purchase affordable housing. "Affordable housing remains out of reach for far too many Americans," said Antonio Weiss, counselor to Treasury Secretary Jacob J. Lew. "This funding will enable organizations across the country to expand access to affordable housing and help meet the critical needs of thousands of families."
CHC helps facilitate both the development of additional affordable housing units and the preservation of existing ones by working with strong nonprofit affordable developers that are members of the national NeighborWorks® Network. NeighborWorks developers acquire vacant land or underutilized/obsolete properties that can be developed into affordable multi-family facilities. They also acquire properties with market rents that are low enough to be affordable to people with modest incomes, as well as troubled market-rate properties that can be rehabilitated and converted into affordable housing. They look to acquire currently subsidized properties with expiring income restrictions that may be at risk of being converted to unaffordable market-rate housing.
Lending exclusively to members of the NeighborWorks network, CHC provides the financing needed to carry out this important work. "CHC will leverage the grant to expand our existing loan fund and provide gap financing for the acquisition and subsequent stabilization and repositioning of affordable multifamily rental housing for low-income families and seniors," said Jack Gilbert, President and CEO of Community Housing Capital. "The award will immediately expand our existing loan pool by an additional $15 million in third party debt; leverage an additional $18.75 million in third party debt through loan participations, and ultimately enable CHC to make $49.4 million of acquisition loans with a projected total development cost of $228.75 million."
Acquisition projects are typically complicated, have multiple types of subsidy from different sources, or require the financing of non-traditional collateral structures. "We are willing to take the time to understand the intricacies of a particular project and help the developer navigate and secure the appropriate range of construction and permanent financing options," said David Landis, Senior Vice President and Chief Operating Officer. "With the Joint Center for Housing Studies of Harvard University estimating an increase of 2.6 million more renters spending at least half their incomes for housing by 2025, this award will enable CHC to help more organizations try to close an affordability gap that can be so devastating to hard-working individuals and families."
About Community Housing Capital
Community Housing Capital, a national Community Development Financial Institution intermediary, serves exclusively as a direct lender to the NeighborWorks® Network. Incorporated in 2000, Community Housing Capital is certified as a community development financial institution and a community development entity by the U.S. Treasury's CDFI Fund. Lending to members of the NeighborWorks network, Community Housing Capital provides both interim real estate development loans and permanent multifamily loans with favorable rates and terms. Loans are underwritten with the flexibility required to finance complex transactions with multiple layers of subsidies. In its first 15 years, Community Housing Capital has made 352 loans totaling $452 million to 131 NeighborWorks organizations in 39 states plus the District of Columbia. This activity created or preserved over 14,000 units of affordable housing and $1.72 billion in total development.
To implement its loan programs, Community Housing Capital uses grant funds provided by NeighborWorks America and the CDFI Fund to significantly leverage private-sector debt capital from socially responsible financial institutions and foundations that support CHC's mission and believe in the NeighborWorks organizations that touch our most vulnerable families and communities. Community Housing Capital is headquartered in Decatur, Georgia. For more information, visit www.communityhousingcapital.org.
About the CDFI Fund
Since its creation in 1994, the CDFI Fund has awarded more than $2 billion to CDFIs, community development organizations, and financial institutions through the CDFI Program, the NACA Program, the Bank Enterprise Award Program, the Capital Magnet Fund, and the Financial Education and Counseling Pilot Program. In addition, the CDFI Fund has allocated $43.5 billion in tax credit allocation authority to Community Development Entities through the New Markets Tax Credit Program, and $852 million has been guaranteed in bonds through the CDFI Bond Guarantee Program.
To learn more about the CDFI Fund and its programs, please view the Fact Sheet or visit the CDFI Fund's website at www.cdfifund.gov. For more information about the Capital Magnet Fund, please view the Program Fact Sheet or visit the CDFI Fund's website at www.cdfifund.gov/cmf