AUSTIN, Texas (April 22, 2024) – Austin Community Foundation announced today the creation of the Housing Accelerator Loan Fund — a new $15 million fund to provide affordable housing developers with more resources so they can better compete in the market to preserve and build affordable housing in Austin.
The Housing Accelerator Loan Fund provides fast, flexible capital to accelerate the pace of affordable housing development. Designed to recycle capital and have a long-term impact, the new fund has the potential to leverage $280 million towards the construction of 850 units in the first 5 years of operation by doing the following:
- Leverage public and private dollars, including $5 million in public investment from the City of Austin and $10 million in philanthropic investment from corporate and individual donors, with a goal to reach $25 million from additional sources.
- Offer low-cost, concessionary financing to affordable housing developers for short-term pre-development, land acquisition, and bridge financing.
- Fill a gap in funding sources, enabling developers to acquire land and build more affordable units in a competitive marketplace.
Key partners that helped bring the Housing Accelerator Loan Fund from concept to reality, include the City of Austin, NI, Shield-Ayres Family Foundation, St. David’s Foundation, and Tito’s Handmade Vodka.
“The Housing Accelerator Loan Fund is a permanent piece of community infrastructure that is missing from our community, and now through cross-sector collaboration we can leverage more resources to increase affordable housing in the Austin area,” said Mike Nellis, CEO, Austin Community Foundation. “We’re thankful for the early supporters of this initiative, but we need more companies and individuals who care about housing affordability to get involved.”
The Housing Accelerator Loan Fund has provided two loans to local affordable housing developers. Current investments include:
- SGI Ventures and Austin Affordable Housing Corporation, subsidiary of the Housing Authority of the City of Austin – A $2 million construction loan at 2.5% interest for Cady Lofts, a permanent supportive housing development underway in Central Austin. Upon completion, the project will provide 100 housing units and supportive services to people transitioning out of chronic homelessness.
- Foundation Communities – A $2.5 million land acquisition loan at 2.5% interest to build 400 new housing units and rehabilitate 200 existing units for adults with intellectual disabilities near South Lamar.
“The Housing Accelerator Loan Fund loan was key to the complex and time sensitive funding needs of Cady Lofts,” said Sally Gaskin, president of SGI Ventures. “As with almost every affordable development today, Cady Lofts required multiple layers of financing to fund the total project cost. Austin Community Foundation’s ability to provide fast, flexible construction financing at a below market interest rate, filled a critical timing and funding gap to help keep this project moving forward.”
The Housing Accelerator Loan Fund is managed by Austin Community Foundation and led by a volunteer committee of leaders and experts in the housing industry. To learn more and apply for funding, visit austincf.org/HousingAccelerator.