Colorado Association of REALTORS | With investment, Colorado’s Mile High Community Loan Fund tackles affordable-housing crisis
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With investment, Colorado’s Mile High Community Loan Fund tackles affordable-housing crisis

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May 25 2017

With investment, Colorado’s Mile High Community Loan Fund tackles affordable-housing crisis

With investment, Colorado’s Mile High Community Loan Fund tackles affordable-housing crisis

 

News provided by:

BBVA Compass

24 May, 2017, 12:52 ET

 

 To view this story in it’s entirety, click here.

 

- BBVA Compass increases equity equivalent investment to $3.3 million in organization, which gives developers access to capital they need to build more affordable housing 

- Rising home prices, booming population contributing to statewide crisis

- Investment will benefit low- to moderate-income areas outside Denver that are also seeing significant housing distress

 

HOUSTON, May 24, 2017 /PRNewswire/ — BBVA Compass shored up its commitment to alleviating Colorado’s affordable-housing crisis, closing a $1.8 million equity equivalent investment this month in the Mile High Community Loan Fund so that the organization can continue to give affordable-housing developers access to the capital they need.

 

Statewide, average home prices have increased 11.2 percent from a year ago, according to data from the Colorado Association of REALTORS® (Stats can be found by clicking here). Coupled with Colorado’s booming population — demographers predict the state will continue to add around 100,000 new residents each year — and weak income growth, the die is cast for an acute need for more affordable housing. The Mile High Community Loan Fund has committed to deploying $26 million between 2015-2017 to support affordable housing. BBVA Compass’ $1.8 million investment is in addition to a $1.5 million investment it made in 2015.

“Mile High Community Loan Fund has a solid track record of lifting up communities in need and building brighter futures,” said BBVA Compass Colorado Market CEO Andy Wykstra. “So we know we’re putting our resources to good use and will be creating opportunities in Colorado for those who need it most.”

 

This newest investment will be used to benefit low- to moderate-income communities in Greeley, Fort Collins, Colorado Springs and Boulder. While sharply increasing housing costs in the Denver metropolitan area are well-documented — and the bank’s $1.5 million equity equivalent investment in 2015 was designed to support efforts there — there is significant pressure on areas outside of Denver, too, with areas like Greeley and Colorado Springs experiencing year-over-year rent increases of 6 and 7 percent respectively, leading the state, according to the Colorado Association of REALTORS® data.

 

“These non-metro areas are experiencing acute housing distress, and the greatest adverse impact is on our low- to moderate-income communities, of course,” said Sean Doherty, executive director of Mile High Community Loan Fund and a member of BBVA Compass’ Community Advisory Board. “Mile High Community Loan Fund truly appreciates BBVA Compass’ commitment to expanding our relationship so we can grow our reach and impact.”

 

Mile High Community Loan Fund


Mile High Community Loan Fund, which was founded in 1999, provides early-stage financing to nonprofit and for-profit organizations for the development or preservation of affordable housing. Since its founding, it has originated more than 150 loans for a total of more than $59 million.

 

Mile High was certified as a community development financial institution, or CDFI, by the U.S. Department of Treasury’s Community Development Financial Institutions Fund in 2001, giving it access to federal grants and resources. CDFIs are private financial institutions whose purpose is to deliver responsible, affordable lending to low-income and underserved communities. They often lend to borrowers that may not meet a traditional financial institution’s underwriting criteria. There are more than 1,000 CDFIs nationwide today, and in 2016, they originated more than $3.6 billion in loans and investments; financed 33,500 units of affordable housing; and made loans to more than 11,000 small businesses.

 

An equity equivalent investment, or EQ2 as it’s known, is a low-interest loan to a community development financial institution. Since it has certain characteristics of an equity investment — it’s deeply subordinated, auto-renewable, with rolling terms — it is considered an investment rather than a loan. Banks find the EQ2 investment attractive in part because it is counted favorably during the federal Community Reinvestment Act exam, which measures how well banks are meeting their communities’ credit needs.

 

BBVA Compass EQ2 investments


BBVA Compass announced in late 2014 that it was committing $11 billion toward supporting low- to moderate-income individuals and communities. Since then, it has closed 10 EQ2 investments with various CDFIs, with three of those impacting Colorado. In addition to the two EQ2 investments in the Mile High Community Loan Fund, the bank in 2016 also allocated $500,000 of its equity equivalent investment in the national Low Income Investment Fund to the Denver area.

 

To learn more about BBVA Compass, visit: www.bbvacompass.com

 

For more news visit: www.bbva.com and newsroom.bbvacompass.com

 

To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/bbva-compass-expands-its-investment-in-colorados-mile-high-community-loan-fund-as-organization-tackles-affordable-housing-crisis-300463297.html

 

SOURCE BBVA Compass

 

Related Links

 

http://www.bbva.com

 

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