Another $50M for Charlotte affordable housing: Private fundraising begins again
Charlotte’s affordable housing efforts can expect another big boost, as the philanthropic fund first launched in 2018 is seeking another $50 million.
Ralphine Caldwell, executive director of LISC Charlotte, confirmed the nonprofit is raising another $50 million for the Charlotte Housing Opportunity Investment Fund, known as CHOIF.
“We know that there is a significant need and there will continue to be a need for affordable housing in Charlotte,” Caldwell said. “We believe this is one of the innovative ways to be able to provide more units on the ground.”
The private fund raised $53 million in recent years, a match to the $50 million housing bond approved by Charlotte voters in 2018.
CHOIF was hailed as a major philanthropic commitment to affordable housing that, when used in conjunction with the Trust Fund, would help public money go further.
Developers seeking Housing Trust Fund money could also apply for the CHOIF to finance construction or renovation of affordable housing units. Community development nonprofit LISC manages the private fund and also helps vet deals for the city’s trust fund.
What’s affordable for a mortgage or rent depends on household income. Charlotte generally uses trust fund money to subsidize developer costs when building or preserving units priced for individuals earning up to $47,150 (up to $67,350 for a family of four).
Potential funders haven’t been announced for this new round, but it’s likely some of Charlotte’s biggest corporate and philanthropic names will be in the mix.
“We are looking for current and new investors to come back into the CHOIF,” Caldwell said.
To reach its last $50 million fundraising goal, banks including Wells Fargo, Bank of America, Truist (then pre-merger as BB&T and SunTrust), Ally and Fifth Third contributed.
Other well-known donors included Atrium Health and Novant Health, Duke Energy and the Howard R. Levine Foundation. The Foundation for the Carolinas put in the first $5 million and led further fundraising but did not award money to projects.
The first round of CHOIF money was fully committed last year, according to a June announcement from LISC. To date, it has funded 1,680 affordable units in a combination of new construction and preservation of naturally occurring affordable housing units, or NOAH properties.
Charlotte has made NOAH preservation a key strategy, seeking to save existing apartments with more affordable rents from developers who might purchase, flip, and raise the rents.
Caldwell said the goal is to complete fundraising by June 1, depending on investor commitments. LISC will be the fundraising organization for this round.
Charlotte affordable housing bond
Charlotte leaders are expected to ask voters again in November to support a new bond allocation for the Housing Trust Fund. Voters approved $50 million in 2018 and again in 2020, with wide margins of support.
The 2022 bond request amount has not been announced, but several city officials have alluded to — or outright said — more money is needed to keep up with the city’s affordable housing needs.
Charlotte City Council “has not yet determined whether to increase the bonds for affordable housing,” Leslie Blaser, spokesperson for the Housing and Neighborhood Services Department, wrote in an email. Council members will discuss bond priorities at the March 9 budget workshop, she said.
Since 2002 the city’s trust fund has spent nearly $219 million to subsidize the construction or preservation of nearly 11,000 income-restricted units and nearly 900 shelter beds.
But rising development costs, including land and construction, have made it even more difficult to address a shortage of affordable units estimated between 24,000 and 34,000.
Several city council members and the city’s former housing director have said they could spend more if they had it.
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