Seattle—A coalition of public, private and nonprofit investors has created a new financing tool that will provide critical, low-cost loans for nonprofit and for-profit developers to purchase sites near existing or emerging transit-accessible areas.
Led by Enterprise Community Partners, the $21 million revolving loan fund aims to preserve affordable housing or help develop new affordable and mixed-income housing in King, Pierce and Snohomish counties. The Regional Equitable Development Initiative Fund (REDI) emerged out of the Puget Sound Regional Council’s Growing Transit Communities Initiative, in which most REDI Fund investors were active participants. The fund comes shortly after the three counties approved a $54 billion transportation package including 10 Sound Transit rail expansion projects and three new bus rapid transit corridors that will help create more opportunities for low-income families.
“It is imperative in our view that households across the income spectrum live near frequent transit, where they have access to jobs, services and healthy community amenities. We are confident that such equitable community hubs have the simultaneous benefit of reducing greenhouse gases and inequitable health and wellbeing outcomes,” said King County Executive and Sound Transit Board Chair Dow Constantine in prepared remarks.
The REDI Fund requires that each existing or new property have a share of affordable units available for those making 80 percent Area Median Income (AMI) or less, or for 20 percent below market rent. Additionally, a quarter of all preserved or newly-built apartments through the REDI Fund must be priced at or below 50 percent AMI, and ideally include at least 15 apartments for households earning 30 percent AMI. Since housing projects financed through the REDI Fund must be equitable transit-oriented developments, the properties acquired with this type of loan must be within half a mile of a rail station or a quarter mile of a bus stop.
According to CityLab, the first tranche of REDI Fund financing is expected to help develop 500 to 700 new affordable housing units, and as those loans are paid back, the funds will be used for future transit-oriented opportunities in metro Seattle.
The coalition of funds includes Enterprise Community Loan Fund, the state of Washington, the city of Seattle, Living Cities, Low Income Investment Fund, King County, King County Housing Authority and A Regional Coalition for Housing.
Photo by Michael Schoenfeld and Enterprise Community Partners