SAN FRANCISCO, CA - The Local Initiatives Support Corporation (LISC) is joining forces with the state of California to spur development and preservation of more affordable housing in both urban and rural communities.
LISC is supporting the $93 million Golden State Acquisition Fund (GSAF), a new financing vehicle to help developers acquire property for multifamily rental or homeownership projects that meet the needs of low-income residents.
The California Department of Housing and Community Development (HCD) seeded the fund with $23 million from voter-approved Proposition 1C. LISC and six other Community Development Financial Institutions (CDFIs) are originating loans and providing the remaining capital. In practice, GSAF buys 25 percent of loans originated by the CDFIs on its behalf at rates and terms that reduce borrowing costs, extend maximum loan terms and finance deals with higher loan-to-value (LTV) ratios than would typically be the case.
Through the fund, LISC is offering loans of up to $13.9 million at 5.15 percent for up to five years. Nonprofit developers are eligible for LTVs as high as 100 percent. “By participating in the fund, our capital goes further,” said Mariano Diaz, regional vice president, with LISC. “We can support more developments and take on deals that might not otherwise work but for these terms,” he said.
“Ultimately, that means we can reach more people who need quality housing and help more communities thrive,” added Stephanie Forbes, executive director of Bay Area LISC.
Terms for qualifying projects are flexible, but developments must be focused on low-income residents. “This is intrinsically linked with our Building Sustainable Communities work to help low-income neighborhoods become safe, strong, and healthy,” said Claudia Lima, executive director with LISC Los Angeles.
LISC handles GSAF loans through its local programs in the Bay Area, Los Angeles and San Diego as well as through its Rural LISC program, which operates in 24 counties throughout the state. “Over the years, LISC has invested billions of dollars in affordable housing for California residents,” said Joe Horiye, executive director with LISC San Diego. “This fund is another way for us to help meet what continues to be a pressing need in the communities where we work.”
Applicants for GSAF funding must demonstrate local government support, the availability of leveraged funds, organizational stability and capacity, and a track record of developing affordable housing. GSAF financing information is available at www.goldenstate-fund.com.