Apple has joined forces with Bay Area developer John Sobrato and nonprofits San Francisco Housing Accelerator Fund and Destination: Home to establish a new $50M affordable housing fund.
The Bay Area Housing Innovation Fund aims to deliver units twice as fast and 40% cheaper than the industry standard, according to a release.
If those goals are met, it means units will be delivered in less than three years at a price tag amounting to less than $550K per door for a studio. Projects that qualify for financing must be located in Santa Clara, San Mateo, San Francisco, Alameda or Santa Cruz.
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“This is the first affordable housing fund to target existing homelessness, and we’re trying to do it as quickly and cost-effectively as possible,” Destination: Home Chief Operating Officer Ray Bramson told Bisnow Wednesday.
The first round of funding will finance the development of 400 units in four or five projects, including 145 senior housing units under development at 1633 Valencia St., a former Sears in the Mission. The second project in Santa Cruz will begin development in the next few months.
“Increasing access to safe and affordable housing is essential for thriving communities here, and we’re excited to help launch the Bay Area Housing Innovation Fund as part of our long-term commitment to our home state,” Kristina Raspe, Apple’s vice president of global real estate and facilities, said in a written statement.
The fund will finance projects geared toward households earning less than 60% of the area median income, roughly $80K for a three-person family. Half of the units must be reserved for the formerly unhoused or very low-income households.
Bramson said the fund enables new development to be fast-tracked because developers can circumvent the often arduous process of obtaining Low-Income Housing Tax Credits.
“Demand for these credits has surged in recent years, especially in the Bay Area, leading to increased competition as developers vie for limited resources,” the Bay Area Housing Innovation Fund’s website says. “Forcing otherwise ‘shovel-ready’ projects to wait in line for scarce resources can push the price tag for a development way up while stretching out timelines significantly.”
New affordable housing developments often take longer than five years to complete and cost more than $1M in San Francisco, according to Destination: Home.
“This is a pilot program that will hopefully entice other corporate and philanthropic partners,” Bramson said. “There are thousands of units of affordable housing in the pipeline. We want to bring on more partners to fund this need in the Bay Area.”
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