CHICAGO, Nov. 3, 2021 /PRNewswire/ -- This week, National Equity Fund (NEF) closed an initial $85 million in investor commitments for its Emerging Minority Developer Fund (EMDF). NEF established the Fund in late 2020 to create access to equity capital resources in order to facilitate accelerated development capacity and wealth creation for Black, Indigenous and People of Color (BIPOC) developers who have not had proportionate and consistent access to LIHTC.
"The EMDF was created to break down old barriers and drive affordable housing forward while openly addressing and fighting the inherent racism, discrimination and inequity that still exists today," said Matt Reilein, president and CEO of National Equity Fund. "NEF has been creating, preserving and expanding access to affordable housing for nearly 35 years, and while we are proud of the impact we've made with communities, individuals and families to date, we know there is more we can do to support the next generation of developers."
Led by NEF Director, Lydia Smith, the EMDF provides capital and technical support, as well as a tailored approach to project underwriting to help emerging BIPOC LIHTC developers build quality affordable housing in their communities, while also establishing a track record of success as they grow their businesses.
"NEF is actively identifying and building a pipeline of deals with eligible developers," said Lydia Smith.
Typically, when NEF launches a fund, deals already have been identified. In this case, NEF called on its existing investor relationships to support the concept of EMDF, and nine investors committed to providing equity before the first deal was even identified. In alphabetical order, Ally Bank, BMO Harris Bank, CIBC, Comerica Bank, Fifth Third Bank, KeyBank, PNC Bank, Truist, and U.S Bank have committed to the first round of EMDF funding.
"Delivering vital funding and investments to underserved communities remains critically important, and the Emerging Minority Developer Fund provides innovative resources to developers at crucial steps of the process," said Beatrice Kelly, Comerica Bank Senior Vice President and Director of Community Development Lending. "Our partnership with National Equity Fund will help support this fund that removes barriers and uplifts businesses who positively impact individuals and families through affordable housing initiatives."
"The inaugural Fund will empower a new generation of developers, providing them with the support they need to move us into the future and away from the current shortage of affordable rental housing," said Gayle Manganello Ellis, SVP and manager of Origination for Tax Credit Solutions group, a PNC Real Estate business. "We are committed to solving the nationwide affordable housing crisis and we are incredibly proud to be involved in this first-of-its-kind fund."
With growing interest from additional partners who are expected to invest over the next few months, the EMDF is on track to exceed its original $100 million target.
"Our definition of success is not getting the first fund closed," said Mark Siranovic, head of Investor Relations for NEF. "Our definition of success comes 5, 10 and 15 years from now, when this first class of developers is doing their third, fourth or fifth deal – with a substantially improved balance sheet because of NEF's additional support in the inaugural EMDF fund."
About National Equity Fund, Inc. (NEF)
National Equity Fund, Inc., is a leading nonprofit Low-Income Housing Tax Credit (LIHTC) syndicator and pioneer in affordable housing with a mission to create and deliver innovative, collaborative financial solutions to expand the creation and preservation of affordable housing. Through its diverse multi- and single-investor funds, NEF generates opportunities rooted in its vision that all individuals and families across the country have access to stable, safe and affordable homes that provide a foundation for them to reach their full potential. Since being founded by the Local Initiatives Support Corporation (LISC) in 1987, NEF has invested more than $18 billion, which represents 200,500 new affordable homes for individuals, families and communities in need across the country. NEF is Chicago-based and has donated more than $200 million in grants to support LISC's nationwide community development work. To learn more about NEF's impact, innovative financial solutions and opportunities, visit www.nefinc.org.
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SOURCE National Equity Fund