Housing Trust Silicon Valley: 20 Years of Impact

Affordable Housing Solutions
Housing Trust Silicon Valley: 20 Years of Impact

Way to make a difference: Since its inception in 2000, Housing Trust Silicon Valley has worked to increase affordable housing opportunities. In a 13-county region stretching from Monterey to Sonoma county, it’s invested $335 million in affordable housing and created 20,761 housing opportunities, working with partners to leverage $4.8 billion to create permanent, sustainable housing.

And its impact extends far beyond the groundbreakings and grand openings that make the headlines: Education and downpayment assistance programs empower first-time homebuyers, homelessness prevention and assistance programs that help vulnerable residents, and developer financing, multifamily loans, and Accessory Dwelling Unit (ADU) resources jumpstart affordable housing production.

Led by Silicon Valley Leadership Group, the County of Santa Clara, and a range of public and private partners, Housing Trust Silicon Valley was created as a nonprofit loan fund. An initial $2 million county grant was quickly matched by $1 million donations each from Intel, Adobe, Cisco Systems, Applied Materials, Solectron, and KB Homes. Within two years, the Housing Trust surpassed its $20 million fundraising goal.

That model of raising capital from non-traditional sources, bringing together private, public, and nonprofit investment, was unique for the time, said Housing Trust Silicon Valley Chief Financial Officer Julie Mahowald, and in the past two decades, has inspired similar actions across the country. As a certified Community Development Financial Institution, Housing Trust Silicon Valley has greater lending flexibility than traditional banks or governmental agencies and has found its sweet spot in providing much-needed capital to projects that would otherwise be underserved.

That access to capital is essential to the creation of affordable homes and in surmounting many of the obstacles that stand in the way of construction. And with a loan fund of $400 million, Housing Trust Silicon Valley is the most prolific nonprofit affordable housing lender in the Bay Area.

The COVID-19 pandemic has widened the disparities in already stressed housing markets, making Housing Trust Silicon Valley’s role more essential than ever. Despite those challenges, the Housing Trust expects to reach a billion-dollar impact on the affordable housing ecosystem across the greater Bay Area within the next five years.

In March 2017, Housing Trust Silicon Valley launched its TECH Fund, partnering with the high-tech sector, large employers, and philanthropists looking to make social impact investments in their region. By providing fast, flexible capital, the fund has helped finance over 3,000 homes with an investment of $117.5 million to date from corporate partners such as Google, NetApp, Pure Storage, Cisco, LinkedIn, the Sobrato Family Foundation, the David and Lucile Packard Foundation and the Grove Foundation. The TECH Fund is also being used by Disney and Microsoft as a blueprint for their own affordable housing investments outside of the region.

The Housing Trust is the first nonprofit Community Development Financial Institution (CDFI) to receive a Standard & Poor’s rating, AA- because of its strong capacity to meet financial commitments.

In the Monterey Bay region, Housing Trust Silicon Valley has closed loans totaling $9 million within the Monterey Bay Housing Trust and has contributed an additional $13.4 million to grow total investments in Monterey, San Benito, and Santa Cruz counties to $21 million for creating or preserving 486 homes. An additional 202 homes are in the pipeline, according to Mahowald, as Housing Trust Silicon Valley looks to continue its successful partnership with MBEP.

In 2016, Housing Trust Silicon Valley and MBEP sponsored the creation of the Monterey Bay Housing Trust, which leverages donations from Housing Trust Silicon Valley lending capital in a four-to-one ratio. Those loans can be used to finance acquisition, pre-development, or construction of affordable housing in the Monterey Bay region.

“We have to be part of the solution,” says Mahowald. “We’re here to lend where banks won’t lend: That’s where we’re able to have an impact.”

See related story: Housing Trust Silicon Valley taps Noni Ramos as CEO  https://housingtrustsv.org/housing-trust-silicon-valley-taps-noni-ramos-as-chief-executive-officer/