March 2, 2020
Community Housing Partners (CHP), a Virginia-based nonprofit which provides affordable and sustainable housing throughout the Southeast and Mid-Atlantic, has received a $4.5 million Capital Magnet Fund grant from the U.S. Department of Treasury’s Community Development Financial Institutions (CDFI) Fund. This is the first time that CHP has received this award.
Through a competitive grant program, the Capital Magnet Fund supports a wide variety of affordable housing and community revitalization projects nationwide, including the development, preservation, rehabilitation, and purchase of housing for low-income families. Certified CDFIs and nonprofit organizations that primarily develop or manage affordable housing communities are eligible for funding.
“The Capital Magnet Fund provides working capital for our real estate development activities at CHP,” said Jeff Reed, President of CHP. “Whenever CHP buys or builds multifamily rental communities, we need funding for short- and medium-term expenses such as a market studies, architectural and engineering work, and other pre-development costs. These expenses can build up over time. The Capital Magnet Fund helps fill in the gaps for longer term expenses to get projects off the ground and better fulfill our mission.”
CHP will leverage the Capital Magnet Fund grant with public and private funding sources to invest more than $158 million in the development or preservation of affordable rental homes in Virginia, Maryland, and Florida. More than 1,800 affordable homes in CHP’s service area will benefit from the grant funding. All of the homes created or preserved will serve low-income families with over 70% of the households earning 50% or less of area median income, and 79% located in areas of economic distress.
“This is a game changer for Community Housing Partners,” said Lance Sutherland, Vice President of Finance and Accounting at CHP. “We can use the Capital Magnet Fund for new construction and preservation projects, while using our other operating funds to invest in our affordable rental communities elsewhere in our service area. This will essentially change CHP’s capacity to deliver on our mission in perpetuity, as the funds will be recycled over and over again as they are paid back by completed projects and reinvested into new ones.”
CHP was one of 38 organizations awarded a total of $130.9 million through the Capital Magnet Fund’s FY 2019 round. Together, the awardees serve 44 states, plus the District of Columbia and Puerto Rico, and are required to leverage their awards with other public and private funding sources by at least 10 to one. According to the U.S. Treasury’s announcement, this means that at least $1.3 billion will be invested in eligible projects through this round of funding.
A total of 113 organizations requested more than $522 million from the Capital Magnet Fund during this application period.