Feb 6, 2015
Mayor Michael B. Hancock today announced the launch of a new, $10 million finance tool to support affordable housing development throughout Denver.
The new Denver Affordable Housing Revolving Loan Fund is seeded with $6 million from the City and County of Denver, along with $3 million from the State of Colorado Department of Local Affairs and $1 million from Colorado Housing and Finance Authority (CHFA), which will also administer the fund.
“This fund will provide a financial boost to development projects, helping Denver deliver greater access to safe, decent, affordable housing in Denver,” Mayor Hancock said. “Financing of affordable housing units is a challenging landscape for nonprofit and private developers, and these funds will work with the many other funding tools necessary to increase the city’s inventory of affordable housing and keep Denver a city for all.”
The announcement was made at Bridging the Gap: A Solutions Forum on Housing, an all-day forum to inspire action among the region’s premier housing leaders to keep the metro area affordable and accessible for all.
The fund is designed to support the development of multifamily rental units serving individuals and families earning up to 60 percent of the area median income (or $46,020 for a family of four). It is estimated that 35 percent of Denver households at this income level are rent burdened, meaning that they pay 30 percent or more of their total income for housing.
Developers can apply for Denver Affordable Housing Revolving Loan Fund financing through CHFA beginning this spring. Loan repayments will revolve back into the fund, providing a means for growth over the years.
“The Denver Affordable Housing Fund is a significant commitment by the city and its partners, CHFA and the Division of Housing, to meet the growing need for affordable housing outlined in the recent Housing Denver plan,” said Pat Coyle, director of the Colorado Department of Local Affairs, Division of Housing.
The fund will target housing projects that receive four percent Low Income Housing Tax Credits through CHFA. In recent years, many affordable developments have been unable to utilize four percent credits due to the lack of soft funds and gap financing, which are necessary to make the projects financially viable.
“Low Income Housing Tax Credits are a critical resource that helps communities meet their complex affordable housing needs. To date, they’ve helped support the creation and preservation of affordable housing for families, seniors, veterans, and the homeless. The availability of the new Denver Affordable Housing Revolving Loan Fund is vital to ensuring strong communities as it helps bring together all of the necessary resources to complete these projects,” said Cris White, executive director and CEO of CHFA.
The Bridging the Gap forum is an outcome of Housing Denver, the city’s new five-year plan to harness public and private sector resources to deliver accessible housing opportunities for people of all income levels. The forum gathered more than 300 industry stakeholders from the public, private and nonprofit sectors to meet in breakout groups to tackle challenges of planning, financing and capacity-building. Topics to be explored during the forum include construction defects, urban renewal authority financing, workforce housing preservation, strategies to end homeless, and a high-cost cities panel with housing representatives from New York City, Boston and Seattle.