$150 Million SDS Supportive Housing Fund Invests $8 Million in Seventh Development; Expanding Housing for Angelenos Experiencing Homelessness

Innovative Partnership between SDS Supportive Housing Fund - SDS Capital Group's private-equity impact fund - RMG Housing and Southside Bethel Baptist Church to provide 47 Units of Permanent Supportive Housing in South LA

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SDS Capital Group

Feb 10, 2022, 09:00 ET

LOS ANGELES, Feb. 10, 2022 /PRNewswire/ -- The $150 million SDS Supportive Housing Fund (SHF or Fund)— a first-of-its-kind private-equity impact fund that finances new and financially-sustainable permanent supportive housing (PSH) for individuals experiencing homelessness – has closed $8 million in funding to develop new housing in South Los Angeles. The project site, located at 10400 S. San Pedro Street, currently home to the Southside Bethel Baptist Church, will soon be transformed into 47 one-bedroom residential units.

Rendering of the 47-unit PSH development on the site of the Southside Bethel Baptist Church in South Los Angeles.

The Fund, managed by Los Angeles-based SDS Capital Group, is providing 95% of the capital for the PSH projects developed by RMG Housing; RMG partners are providing the remaining capital co-investment. The project will not require any other source of financing. The Fund's "one-stop" financing approach significantly reduces the usual time required to underwrite and close funding on such PSH projects from an average of 5-7 years for most similar projects to approximately 24 months—from underwriting to tenant occupancy.

"This is our seventh PSH investment with RMG and our third project we have financed with a local church partner. We are thrilled to be supporting Bethel Baptist Church's mission to provide for members of their surrounding community who are most in need," said Deborah La Franchi, Founder & CEO, SDS Capital Group.

The Fund's quick turnaround and efficiency to finance a project are atypical in an industry characterized by the need for a multitude of funding sources that can take years to aggregate. Another key point of distinction for the SHF Fund is a focus on investing exclusively in projects that are financially sustainable over the long term. This requires that PSH per-unit development costs not exceed $200,000, compared to the $500,000 average costs currently seen in the market.

The SDS Supportive Housing Fund is on track to finance a total of 1,800 units of PSH, mostly in the Los Angeles area. To date, the Fund has financed seven projects totaling 310 newly constructed units of PSH.

The site, located at the corner of 104^th and San Pedro, has been owned by Southside Bethel Baptist Church for over 64 years.

"Our partnership with Southside Bethel Baptist Church is a great example of the private-sector and the faith-based community working together to serve the community with an even greater impact," said RMG Housing Founder Tim Roth.

Full press release

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