Chapter 3The Charge to Philanthropic & Private Sectors
The region’s philanthropic and private sectors are adding their muscle to strengthen housing affordability through advocacy, education and investments. Their leadership role is critical to getting the resources needed to expand housing affordability in the region. Major employers also have a vested interest as their workforce needs housing options, including affordable housing, all across the spectrum. Several examples illustrate their efforts:
- The Washington Regional Association of Grantmakers (WRAG) and Enterprise Community Loan Fund spearheaded the Our Region, Your Investment initiative. This effort brought new capital to the region’s housing affordability efforts. It raised over $12 million in investments and preserved or produced over 650 housing units around the region, at Brookland Place, Clarendon Court, Crest Apartments, Fort Stevens,Gilliam Place, and Villages of East River .
- The Greater Washington Community Foundation provides funding and other resources to support housing affordability. In addition to its grantmaking, since 2019 it has supported the development and preservation of over 530 affordable homes through a partnership with Enterprise Community Loan Fund. These investments will create long-term housing options for our neighbors and help to preserve and increase the supply of deeply affordable housing in region.
- Foundations like the Morris & Gwendolyn Cafritz Foundation and Meyer Foundation provide grants to a wide range of area nonprofit housing organizations for specific projects like advocacy efforts, support services, pre-development and development, and operating support. Many lenders, such as Citi, Capital One, Bank of America, and Wells Fargo also have development foundations that play a similar role – grants to housing organizations to help them provide preserve or expand affordability.
- JBG-Smith, a real estate company, partnered with the Federal City Council to create The Washington Housing Initiative. One component of the Initiative, the Washington Housing Conservancy, acquires apartments in rising markets and keeps them affordable to lower wage, working households. They hope to preserve 3,000 homes over time, and have helped with 3 acquisitions to date – 1 in DC , 1 in Alexandria and 1 in Arlington (totaling 1,280 rental homes). Rents in these homes will serve families earning up to 80% of the Area Median Income.
- Just as 2021 began, Amazon announced their Housing Equity Fund, a more than $2 billion commitment to preserve existing housing and create inclusive housing developments through below-market loans and grants to housing partners, traditional and non-traditional public agencies, and minority-led organizations. The fund will support Amazon's commitment to affordable housing, and will help ensure moderate- to low-income families can afford housing in communities with access to neighborhood services, amenities, and jobs.
- JP Morgan Chase and Kaiser Permanente have teamed up with Enterprise Community Partners, National Housing Trust, the University of Maryland and Montgomery and Prince George Counties to preserve affordable housing along the 21-stop, 16-mile Purple Line Corridor. Formed in 2013, this multi-sector collaborative is led and administered by the University of Maryland’s National Center for Smart Growth and the Purple Line Community Coalition who managed the community development agreement which articulates a collective vision for vibrant economic and community development along the corridor. A part of JP Morgan Chase’s $25 million, five-year commitment to the Greater Washington region, will create and preserve affordable housing along the Purple Line corridor (to preserve/create 1,000 affordable homes - a portion of the 17,000 units to be preserved in total along the Purple Line).
- The 11th Street Bridge Project in the District of Columbia is a public-private partnership that includes a community land trust (CLT) model. The Douglas Community Land Trust (DCLT) was created to preserve housing and land that is at risk due to development pressures occurring as a result of the 11th Street Bridge Project development. The Douglass Land Trust is providing homeowner opportunities to residents that would otherwise not be able to own a home. Community land trusts are a means to communally control real estate in order to create and maintain affordable housing into perpetuity. A number of other partners are working to make the Douglass Community Land Trust a reality. City First Bank serves as an incubator and technical advisor. JP Morgan Chase has also donated $5 million in seed money to get the project off the ground. The National Housing Trust will manage the properties in the land trust once they have been acquired.
- Banks fulfilling Community Reinvestment Act (CRA) objectives also help create and preserve affordable homes. Two Capital One examples illustrate CRA use that include the full range of other financing and land use tools (local government loans, federal low- income housing tax credits and density bonuses):
- Victory Housing’s Victory Crossing located in Silver Spring is a mixed income, LEED Silver, development of 105 rental homes - 95 affordable/income restricted units and 10 market-rate units (80 1-bedroom and 25 2-bedroom apartments). Capital One provided $11.3 million in construction financing $5.8 million in tax credit equity.
- AHC Inc’s The Apex, located in Arlington was recently opened as a new community of 256 affordable apartment homes. After a planning process to allow additional density on the site, The Apex replaced the aging 137-unit Berkeley Apartments (a net gain of 119 affordable homes on the same site). Apex’s one- two- and three-bedroom apartment homes are available for families earning 40% to 80% of the Area Median Income (AMI). Capital One provided $20 million in construction financing and $34 million in tax credit equity.
Philanthropic and private sector efforts will need to be significantly increased in tandem with public sector initiatives to effectively meet the region’s future housing needs all along the price spectrum. Facilitating this goal of more housing options requires continual cross-sector collaboration, which can ensure the Washington Region remains competitive and prosperous in the years to come. Specifically:
- More direct private sector investments in affordable homes like JBG Smith and Amazon are needed. Below market-rate funding in the form of low-interest loans and grants are the main engines to producing more affordable homes. Private sector funding can leverage local, state and federal government funding that remains the primary source for gap financing. Companies located in the region and in growing sectors of the economy such as real estate, tech, cyber security and health care should be engaged to expand funding to build more affordable housing options for their workforce.
- The philanthropic sector's continued investments and support for organizations that develop affordable housing is critical. Foundation funding supports regional efforts to educate and advocate for increased housing affordability. Sustained, multi-year funding efforts, would support our region's collective housing targets in a meaningful way.