U.S. Bancorp

07/29/2021 | News release | Distributed by Public on 07/28/2021 23:35

U.S. Bank initiative with CDFIs will invest in developers of color

U.S. Bancorp Community Development Corporation (USBCDC) is partnering with community development financial institutions (CDFIs) to support and grow the number of developers led by people of color. Through its new U.S. Bank Access to Capital: Collaborating to Invest in Developers of Color, USBCDC has awarded $250,000 total in grants to three CDFIs and provides an opportunity for other CDFIs to apply for future grant funding. The grants will be used to provide technical assistance to developers of color.

The three CDFIs are Capital Impact Partners, Chicago Community Loan Fund and Enterprise Community Loan Fund, the CDFI of national affordable housing nonprofit Enterprise Community Partners. All are long-term partners of USBCDC - the tax credit and community development subsidiary of U.S. Bank - and each already provides technical assistance and financing for developers of color.

'The intent is to build capacity and help more individuals of color become developers, assist organizations led by people of color in developing their first real estate project, and provide existing developers of color opportunities to increase their experience and skills,' said Zack Boyers, USBCDC president and CEO. 'We're starting with these three CDFI partners and will expand opportunities for funding to others in future years.'

The initiative is part of U.S. Bank Access Commitment, the bank's long-term program to build wealth while redefining how the bank serves diverse communities and provides more opportunities for diverse employees.

'Developers of color have historically faced significant barriers to entering the real estate industry due to lack of experience, equity, and capital resulting from generations of structural racism and disinvestment,' said Ellis Carr, president and CEO of Capital Impact Partners and CDC Small Business Finance. 'As a result, many communities are not being appropriately represented when it comes to shaping the future of their city. This investment by U.S. Bank will help us expand our Equitable Development Initiative into the San Francisco Bay Area and support developers to build the kinds of projects that create locally-led solutions.'

'This grant from U.S. Bank aligns with Chicago Community Loan Fund's (CCLF) strategic initiative to build wealth for smaller real estate developers of color,' said Calvin L. Holmes, CCLF president. 'The funding will allow us to tailor technical assistance to the unique needs of these entrepreneurs so they can create larger social impact in their neighborhoods with their projects.'

'The time is now to advance racial equity in the housing and community development industries,' said Lori Chatman, president of Enterprise Community Loan Fund. 'We are thankful for U.S. Bank's support - which will be used to help grow the businesses and pipelines of housing providers of color.'

Awarding future funds

This first $250,000 in grants is a pilot; future grant recipients will be selected through an application process. The deadline to apply is Aug. 27 and the next round of grants will be distributed in early 2022. U.S. Bank will select between three and five CDFIs to receive grants of around $50,000 each. The next round will focus specifically on the affordable housing industry; to be considered, CDFIs must be Black-led and work with Black-led affordable housing developers. For more information or to obtain a copy of the RFP, contact Whitney Wallach at [email protected]

Accessing support

Developers of color looking for technical assistance can contact any of the three CDFIs receiving funds in the pilot to learn more:

U.S. Bank Access to Capital: Collaborating to Invest in Developers of Color also includes continued lending to CDFIs from USBCDC's Specialty Finance team, which can, in turn, fund pre-development capital for Black- and person of color-led developers. U.S. Bank has provided more than $450 million in capital to CDFIs and their customers - the majority in the last four years.

This is one of several ways the bank is supporting developers of color. U.S. Bank and Enterprise Community Partners recently announced the issuance of a $30 million racial equity bond that will help provide loans to Black, Indigenous and people of color housing developers. Enterprise issued the bond, while U.S. Bank served as structuring agent, advisor and sustainability coordinator. U.S. Bank also purchased the initial $10 million of the bond.