NEW YORK, Oct. 15 /PRNewswire-USNewswire/ -- The Local Initiatives Support Corporation (LISC) has been awarded $5 million from the Treasury Department's first-ever Capital Magnet Fund (CMF) Awards, a new $80 million federal program focused on creative financing tools for affordable housing and other community facilities. LISC was one of 23 organizations chosen for grants among 230 applicants seeking support from CMF, which is administered by Treasury's Community Development Financial Institutions Fund (CDFI Fund).
LISC will use its $5 million allocation to leverage private loan dollars and launch its new LISC Neighborhood Revitalization Loan Fund, which is expected to finance at least $100 million in affordable rental housing in communities with high housing needs, as well as related economic development and community facilities, like community health centers and childcare centers. The LISC Fund will offer predevelopment, construction and acquisition loan products that will help fill the gaps left by the current lending crunch, as well as innovative guarantees to attract additional investment capital to Low Income Housing Tax Credit projects.
"We could not be more excited about this award," noted Michael Rubinger, LISC president and CEO. "It speaks to the Obama Administration's commitment to local, comprehensive community revitalization and the CDFI Fund's assertive efforts to efficiently deploy capital in support of high-impact programs."
LISC's new Fund will focus on the significant housing development challenges posed by the lingering recession, Rubinger explained. In conjunction with LISC's tax credit affiliate--National Equity Fund, Inc. (NEF)—it will backstop the cash flow of hard-hit developers with a liquidity guaranty for some NEF investment funds and provide expiring use Section 8 guarantees to help preserve critical properties that might be otherwise lost from the affordable housing stock.
"Over the last two years, we have seen what happens when investor confidence fades and LIHTC capital dries up," noted Joe Hagan, president and CEO of NEF. "Much-needed projects stall and die. Quality developers find themselves in financial turmoil. And communities suffer. "
The impact of the CMF dollars will go far beyond individual projects, noted Rubinger. "Affordable housing is just one piece of LISC's Building Sustainable Communities strategy," he said. "We are focused on comprehensive revitalization plans that incorporate everything from quality schools and recreational facilities to retail development, jobs programs, community safety efforts and health care initiatives—all of them happening simultaneously in targeted communities. CMF is helping us transform blighted neighborhoods into good places to live, work, do business and raise families."
For more on the Capital Magnet Fund, visit www.cdfifund.gov.
LISC combines corporate, government and philanthropic resources to help nonprofit community development corporations revitalize distressed neighborhoods. Since 1980, LISC has raised more than $9.7 billion to build or rehab more than 271,000 affordable homes and develop 40 million square feet of retail, community and educational space nationwide. LISC support has leveraged $31.1 billion in total development activity. For more information, visit www.lisc.org.
National Equity Fund, Inc. is a nonprofit Chicago-based affiliate of the Local Initiatives Support Corporation (LISC) and one of the nation's largest syndicators of Low-Income Housing Tax Credits, Historic Tax Credits and New Markets Tax Credits. Since 1987, NEF has invested $7.5 billion in nearly 1,800 projects that have built and preserved 109,000 homes affordable to low-income families and individuals. For more information, visit www.nefinc.org .
SOURCE Local Initiatives Support Corporation