Last year, the Low Income Investment Fund (LIIF), Stewards of Affordable Housing for the Future (SAHF) and National Affordable Housing Trust (NAHT) announced a partnership to create equitable, opportunity-rich communities anchored by quality, safe affordable housing through a unique outcomes-focused approach built on the financial strength and expertise of the individual partners.
As the partners begin their work together, they have focused on engaging developers to better support the industry at this pivotal moment and keeping a keen focus on serving low-income families and communities of color, who are disproportionately impacted by the nation’s affordable housing crisis. At launch, the partners committed to raising $1 billion over the first five years of the partnership to build, protect and preserve approximately 10,000 affordable homes across the country. To date, the Joint Venture has:
- Deployed $202 million in housing investments
- Created or improved 4,500 units
- Launched the $70 million Black Developer Capital Initiative (BDCI)
Launching the BDCI demonstrates the potential power of the collaboration among the Joint Venture partners. The initiative has a racial equity focus, leverages the expertise and innovation of the organizations and brings new capital partners to the table. BDCI includes products aimed specifically at supporting the growth of Black-led affordable housing developers: a Line of Credit product led by LIIF and supported by Bank of America and Wells Fargo, and an NAHT-led Low-Income Housing Tax Credit (LIHTC) Equity Fund. In addition to the funding from the banks, Arnold Ventures, grant funding from Santander Bank and LIIF’s prior award from MacKenzie Scott are supporting the initiative. NAHT expects the BDCI LIHTC Equity Fund to close this year, which will work directly with Black developers as partners to secure market equity at market terms. The initiative is pushing the capital partners to reexamine the traditional emphasis on sponsor liquidity and net worth over experience and demonstrated industry success.
Addressing the lack of affordable housing is one of the nation’s most critical challenges and the national conversation reflects a growing understanding that housing is deeply connected with broader economic and social justice issues. The conversations internally among our staff and with partners and borrowers in the sector spurred the development of the BDCI, which we view as a tangible example of centering racial equity in our work.
Our partnership has positioned us well to support broader, more holistic approaches to affordable housing development. For example, the partners are working toward systems change through advocating for policies that better respond to community needs, such as the proposed Community Revitalization Fund (CRF). This is a $10 billion HUD grant program explicitly intended to invest in civic infrastructure. Neighborhood development that is responsive to the unique housing, social and economic needs of a community is already a complex task. The proposed CRF would provide more streamlined and dedicated resources to support community-led redevelopment projects. SAHF member The Community Builders (TCB) has led comprehensive neighborhood revitalization efforts, like the Avondale Town Center in Cincinnati, Ohio, which transformed a disinvested retail strip mall into a vibrant hub with local businesses and essential services, such as a health clinic, day care and mixed-income housing. TCB was among the 97 signatories of a letter to Congress advocating for funding the CRF.
In addition, the joint venture partners continue to explore ways to collaborate on systems-level solutions across the industry including supporting policies such as expanding the Capital Magnet Fund with a set-aside for $3 billion Stabilization Acquisition Emergency Fund to help mission-driven entities acquire properties for affordable rental or homeownership purposes. The partners are working to advance policy changes to protect residents and long-term affordability in the Low Income Housing Tax Credit program by clarifying nonprofits’ Right of First Refusal for properties they have developed. Together, the partners are also exploring new approaches to holistic community development through the co-location of affordable housing and early care and education centers and integrating health and social services with housing.
The nation continues to face an affordable housing crisis, but the heightened social, health and economic challenges of the past few years have also spurred a new openness for change, innovation and collaboration in the sector. In one year, the joint venture among LIIF, NAHT and SAHF has yielded new products, investments and key lessons for the organizations to take advantage of this moment to push for equity, opportunity and well-being for every community.