#USA #Chicago #affordable housing #National Equity Fund #NeighborWorks Capital

Innovative Collaboration for Affordable Housing

In a groundbreaking initiative, NeighborWorks Capital, a renowned non-profit Community Development Financial Institution (CDFI), has teamed up with the National Equity Fund (NEF) to introduce its inaugural NeighborWorks Capital Equity Fund. Closed with an impressive $110.4 million in Low-Income Housing Tax Credit (LIHTC) equity, this fund aims to bolster the efforts of non-profit organizations across the nation in tackling the critical affordable housing crisis.

The Fund's Impact

Launched in April 2024, this equity fund is set to support seven significant developments nationwide, expected to yield 517 units of affordable housing. This unprecedented financial achievement reflects a committed push towards enhancing the living conditions in communities that often face challenges in accessing affordable housing.

Matt Reilein, the President and CEO of NEF, emphasized the importance of long-term partnerships to advance their mission, stating, “Our collaboration with NeighborWorks organizations illustrates our dedication to the cause. Our collective goal is simple yet vital: to create more affordable housing opportunities for families in need.”

The partnership is more than a financial arrangement. It embodies a shared vision of providing high-impact capital to expand access to affordable housing in urban, suburban, and rural areas alike. Jim Peffley, the CEO of NeighborWorks Capital, reiterated the strength of this collaboration, highlighting their mutual commitment to support community-oriented nonprofit developers.

Enhancing Access and Accelerating Processes

What distinguishes this fund is its provision of equitable and transparent terms for LIHTC projects, which have historically been difficult for non-profits to navigate. Peffley noted that NeighborWorks organizations are the largest producers of affordable rental housing, outperforming even the most prominent for-profit developers in the market.

“This fund equips these organizations with the means to advance projects more swiftly and efficiently,” Peffley said. “We aim to continue building capital advantages to reach more communities and support more residents in achieving improved living standards.”

Moreover, the fund extends its impact beyond the initial projects, with an additional 19 projects benefiting from NEF funds, contributing over 1,300 housing units designed to meet community needs.

Collaborations with Key Investors

The success of the NeighborWorks Capital Equity Fund stems from the invaluable support of five strategic investor partners: Capital One, First Citizens Bank, Northern Trust, Wells Fargo, and Wintrust. Each partner expressed their commitment to enhancing affordable housing through collaborative investment, aligning capital deployment with community-driven missions and visions.

Fiona Hsu, Head of Community Development Finance for First Citizens Bank, praised the partnership, reaffirming their dedication to fostering financial stability and security within communities. Similarly, investors from Wintrust and Capital One shared insights on the need for community-focused initiatives like this fund, which supports the objectives of nonprofit housing developers.

Future Prospects

Going forward, NeighborWorks Capital and NEF are eager to continue their impactful partnership, aiming to expand the fund further and increase their geographical footprint. The existence of this fund serves as a model for innovative solutions to the affordable housing crisis, empowering under-resourced communities and enhancing the lives of countless families.

Liz Hibbard, Senior Vice President at NEF, encapsulated the significance of this launch: “Our inaugural fund not only bridges gaps in the current housing market but also connects underserved non-profits with valuable resources. As we progress, we aspire to develop more funding avenues that transform access to affordable housing for all.”

Through collaborative efforts and strategic investment, this initiative demonstrates how coordinated action can effect significant change in the housing landscape, promising brighter futures for families striving for stability and opportunity.

About the Organizations

National Equity Fund (NEF) is a pioneer among non-profit real estate investment managers, dedicated to expanding the availability of affordable housing. Since its inception in 1987, NEF has catalyzed investments exceeding $27.2 billion, resulting in close to 260,000 units of affordable housing.

NeighborWorks Capital, operating as a certified CDFI, has spent over 25 years supporting the NeighborWorks America network, empowering approximately 250 non-profit housing organizations across the U.S. Their rating from SP Global highlights their strong financial capabilities, positioning them well to continue their mission of community development and affordable housing.

For those interested in exploring more about this initiative or the involved organizations, additional details can be found at NEF's website and NeighborWorks Capital's site.