The innovative fund, exclusive to members of
the NeighborWorks America network, will provide LIHTC equity with
equitable, consistent terms, helping create and preserve more
affordable housing across the country.
CHICAGO, April 16,
2024 /PRNewswire/ -- NeighborWorks Capital, a
national non-profit Community Development Financial Institution
(CDFI), has partnered with National Equity Fund (NEF), a leading
non-profit multi-family, affordable, real estate investment
manager, to launch the NeighborWorks Capital Equity Fund. This
first-of-its-kind equity fund will provide high-performing
community-based non-profit organizations with a set of
standardized, equitable Low-Income Housing Tax Credit (LIHTC)
terms. The creation of this fund stems from NeighborWorks Capital's
desire to provide NeighborWorks network organizations with access
to equitable, consistent capital and NEF's aligned mission.
"The idea to create a LIHTC fund for NeighborWorks organizations
came from my time leading a syndication business," said
Jim Peffley, CEO of NeighborWorks
Capital. "The capital marketplace is not always equitable, and that
is certainly true for the LIHTC market. Because syndicators and
investors need to secure large numbers of transactions in a
competitive environment, they often prioritize large developers.
Large developers with a significant pipeline have more leverage
with investors, and as a result, they often demand and receive
better terms. I saw this happen year after year. Most non-profit
developers do not have the scale to have that market leverage, and
as a result, they often do not receive the best available
terms."
While the fund is a new option for in-network organizations, NEF
is not a new partner to NeighborWorks America, having worked with
76 NeighborWorks members to deploy more than $2 billion in equity for the creation of nearly
350 developments across the country, which resulted in
approximately 20,000 units of affordable housing. Now,
organizations within the network will receive consistent terms for
LIHTC developments, including NEF's favorable exit terms that
preserve affordability and protect against potential challenges in
retaining their development at the end of the compliance
period.
"At National Equity Fund, we are committed to finding
innovative, collaborative financial solutions that help us expand
the creation and preservation of affordable housing," said
Matt Reilein, president and CEO of
NEF. "Our decades of experience working with partners of all sizes
has helped us understand that there can be different experiences in
terms of navigating LIHTC processes, terms and resources depending
on the size and tenure of a developer. The NeighborWorks Capital
Equity Fund allows us to provide partner organizations with LIHTC
terms that will positively impact the development of more
affordable housing across the country for families in need."
In addition to equitable terms, the NeighborWorks Capital Equity
Fund will allow network organizations to recognize efficiencies
including savings on legal fees and time spent on negotiating
investment agreements.
"This fund changes that dynamic for members of the NeighborWorks
network," said Peffley. "NeighborWorks organizations are true
community-based organizations that advance the priorities of
residents. These organizations and the communities they serve
deserve the best available LIHTC terms. Collectively, NeighborWorks
organizations produce more affordable rental housing than any other
developer. This partnership with National Equity Fund gives these
critical non-profits the stature they deserve in the
marketplace."
"This is an incredible opportunity to empower a non-profit
network to drive deeper impact in communities that have
historically been under-banked and under-served," said Liz Hibbard, Managing Director - Innovation and
Strategic Growth at NEF. "Now, we can offer mission forward
partners equitable terms and enhanced transparency all while
furthering our mission and vision that all individuals and families
have access to safe, stable affordable housing."
About National Equity Fund, Inc.
(NEF)
National Equity Fund, Inc. (NEF) is a leading
non-profit, multi-family, affordable, real estate investment
manager with a mission to create and deliver innovative,
collaborative financial solutions to expand the creation and
preservation of affordable housing. Through its Low-Income Housing
Tax Credit (LIHTC) syndication platform and its lending and
investing platforms, NEF generates opportunities rooted in its
vision that all individuals and families across the country have
access to stable, safe, and affordable homes.
Since being founded in 1987, NEF has invested over $24.5
billion, representing 242,500 new or preserved affordable homes for
individuals, families, and communities in need across the country.
NEF is Chicago-based and has donated more
than $240 million in grants to support its affiliate
LISC's nationwide community development work. To learn more about
NEF's impact, innovative financial solutions, and opportunities,
visit www.nefinc.org.
About NeighborWorks Capital
NeighborWorks Capital is a national non-profit, certified
Community Development Financial Institution (CDFI) serving
NeighborWorks America network organizations, nearly 250 strong,
capable non-profit housing and community development organizations
in every state, District of
Columbia, and Puerto Rico.
These organizations provide communities with affordable housing,
financial counseling, training, and resident engagement in the
areas of housing, health, employment, and education. Since its
inception, NeighborWorks Capital has deployed over $500 million in loan capital to support the
NeighborWorks network. In 2023, NeighborWorks Capital received its
first-ever S&P Global issuer credit rating of A+/Stable,
sighting key strengths in capital adequacy, profitability,
liquidity, and financial management. The organization has been
Aeris-rated since 2011 and has an AA- financial strength and
performance rating, indicating strong financial capability,
performance, and risk management practices. For more information,
visit: https://neighborworkscapital.org/
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SOURCE National Equity Fund