2024 Spring Issue of Urban Land - 67

cated to access and has a lengthy application,
review and negotiation process that can take
years to cobble together, " she says, adding
that while funding is being sorted out, building
costs can go up.
SDS's supportive housing fund is all private
capital, consisting of funding from banks, corporations,
foundations, and endowments. Less
restrictive funding has allowed SDS to use the
capital nimbly, says La Franchi. " We can literally
close on the transaction in three weeks if
we need to. SDS provides up to 97 percent of
all the construction and land cost, so we go
very high up the capital stack. "
La Franchi projects that the fund will
finance more than 2,000 units in California.
" Four of our projects will have tenants moving
into them in 2024, so our projects are starting
to come off the assembly line, so to speak, "
she says.
SDS supports only one developer with its
$190 million fund: Los Angeles-based RMG
Housing, which has come up with a costeffective
development model, according to
La Franchi. Instead of reinventing the wheel
for every project, RMG uses the same format
for each of its developments. As a result,
the developer can build units for less than
$250,000. That's far less than the $600,000
to $800,000 it typically costs to build supportive
units, La Franchi says. " We're using
private sector money and using a model that's
much more efficient. "
Silverman says that, although the private
sector has not historically driven the development
of supportive housing, private capital
allows for agility and comes with a focus on
innovation that can drive scale. Lotus Campaign
takes no government funding, and
Silverman says that philanthropic dollars are
competitive.
In 2023, JPMorgan Chase financed the
acquisition, conversion, and operation of a
hotel on Manhattan's Lower East Side into a
120-bed " safe haven " and medical clinic. The
bank noted that its Community Development
Banking team worked with its Public Finance
Housing and Public Finance Debt Capital
Markets teams to design a financing solution
that could be used as a template for future
projects.
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" While capital is often readily available to
help construct or rehabilitate buildings, service
funding and local operating programs can
sometimes be delayed, causing providers to
use existing funds or lines of credit to bridge
the timing payments, " says David Walsh, managing
director of Community Development
Real Estate East Region at JPMorgan Chase.
Walsh adds that connectivity with diverse
funders becomes even more important in
these instances.
Haggerty says Community Solutions has
been able to tap into an array of private
capital, including from health care companies,
foundations, and other corporate interests that
are committed to addressing homelessness.
Partnerships as models
Partnerships can make a difference in efforts
to solve homelessness. Lotus Campaign's
housing and services model brings together
the for-profit and nonprofit sectors to create
the most impact.
" Once you have a few partners, it's easy to
get more people on board, " says Silverman.
Optimism is important, she says, as is
" getting people to be part of a problem to
solve something that seems unsolvable. " To
Community Solutions'
Rosanne Haggerty says she's
noticed more groups tapping
into the Inflation Reduction
Act as a resource to help
solve homelessness.
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2024 Spring Issue of Urban Land

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