Bank of America Community Development Banking (CDB) announced it provided $7.1 billion in debt and equity financing last year to help build strong communities through affordable housing and economic opportunity across the United States.
According to a report from the bank, this financing helped create and preserve 11,000 housing units for individuals, families, seniors, veterans, homeless people and people with special needs.
A 2023 report from the Joint Center for Housing Studies at Harvard University notes that: “millions of households are now unable to own a home, facing the burden of housing costs or are completely homeless.”
“The need for affordable housing continues to grow. However, affordable housing developers face the same macroeconomic headwinds that other industries face: higher interest rates, inflation and supply chain issues,” said Maria Barry, national executive of Community Development Banking at Bank of America.
“This requires our team to be creative, plan for all scenarios and advise our clients on how to mitigate risk and maximize results,” Barry added.
The 3 factors that help drive the creation of affordable housing include:
1. Strong partnerships
Whether doing business locally or nationally, affordable housing developers are facing rising costs due to interest rate fluctuations, supply chain disruptions, and rising construction and insurance costs. CDB provides financing, treasury and advisory services to optimize businesses so developers can focus on their mission of creating much-needed affordable housing.
2. Focus on families and affordable housing
CBD explores solutions to expand its impact in communities. In 2023, he worked with Enterprise Community Partners to launch a workforce housing fund. This $150 million fund will preserve more than 3,000 housing units for the “missing middle,” or those earning between 80% and 120% of the area median income (AMI).
These households earn too much to qualify for affordable housing and too little to keep up with rents. The fund has already closed two deals in the Washington, D.C. and Miami metropolitan area, preserving rental affordability for nearly 500 individuals and families.
3. Support services and access to health care
CDB has a strong focus on developments that incorporate resident services, including access to financial education and overall health and well-being through programs such as: academic support, job readiness, training programs, family programs, food education, access to healthy foods and other critical support services.
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