It Takes More than Money: Building Capacity to Attract and Deploy - - PowerPoint PPT Presentation

▶

Dec 26, 2023 206 likes •348 views

It Takes More than Money: Building Capacity to Attract and Deploy Private Capital R O B I N H A C K E , L I V I N G C I T I E S D A V I D W O O D , H A R V A R D I N I T I A T I V E F O R R E S P O N S I B L E I N V E S T M E N T M A R

SLIDE 1

R O B I N H A C K E , L I V I N G C I T I E S D A V I D W O O D , H A R V A R D I N I T I A T I V E F O R R E S P O N S I B L E I N V E S T M E N T M A R Y K A Y B A I L E Y , M N P H I L A N T H R O P Y P A R T N E R S

It Takes More than Money: Building Capacity to Attract and Deploy Private Capital

SLIDE 2

What’s Capital Absorption?

Capacity as the landing strip for

community investment

SLIDE 3

Capital Absorption Framework

 Living Cities’ response to observed gaps in capital

absorption capacity:

 “the ability…to make effective use of different forms of

capital to provide needed goods and services to underserved communities”  Community development investment (CDI) includes

many sectors: housing, health, education, arts & culture, economic development, financial services, etc.

 Five functions seen as critical to effective CDI

3 ¡

SLIDE 4

Functions: Vision

4 ¡

 Ensure that investment meets recognized

community needs and is done with support of community actors

 Define needs  Engage with community  Convene stakeholders  Determine priorities

SLIDE 5

 Very strong in terms of engaging community and convening

stakeholders

 Many area plans for granular detail  But, priorities not always clearly articulated and agreed upon

 No consensus across stakeholders on the definition of TOD  Focus on housing and mixed use with more limited attention

to job intensive development

 Development vision often not aligned with realities of market

and available public subsidies

 Lack of shared prioritization of key sites or station areas along

the corridors

5 ¡

SLIDE 6

Functions: Enabling Environment

6 ¡

 Build the policy and support tools that allow

community investment to take place

 Set and influence policy and regulatory environment  Apply and enforce policies and regulations  Generate and provide data  Provide subsidy, first loss money, and training  Ensure availability of diverse and capable actors

SLIDE 7

7 ¡

 Many strengths

 Very strong support system for affordable housing –

particularly preservation and supportive

 Political environment pro-housing and leadership is strong  Innovative funding specifically targeted to TOD  Presence of several national and community banks that

recovered relatively quickly from financial crisis

 Limitations in certain subsidies

 TIF capacity in St. Paul  Limited number of LIHTCs

 Transitways (with different definitions) are one of a number of

priorities for targeting affordable housing

SLIDE 8

Functions: Pipeline

8 ¡

 Generate deals and projects that contribute to

defined community goals

 Spot opportunities  Pull together projects and deals  Predevelopment and development  Leverage public resources  Assemble capital  Structure and underwrite investments  Align deals with vision and goals

SLIDE 9

9 ¡

 TOD Market and Development Challenges

 Rail access alone is unlikely to drive a project, particularly in early

stages with only 1 line built and another in construction

 Type of infill redevelopment along Central Corridor is complex

and costly

 Takes time for market to recognize benefits of TOD  Current rental rates limit feasibility of housing in some station

areas

 Any affordable or mixed-use TOD project requires substantial

subsidy and availability, particularly for affordable housing, is a major barrier

SLIDE 10

Functions: Execution

10 ¡

 Manage portfolio to ensure financial and social

performance

 Loan servicing  Portfolio management  Workouts and problem solving  Data collection and evaluation  Social impact monitoring  Organizational capacity building

SLIDE 11

11 ¡

 Data to track results related to development and public

subsidy difficult to assemble

 Social impact for Corridors of Opportunity primarily

defined around affordable housing and small business retention

SLIDE 12

Functions: Innovation

12 ¡

 Learn and apply lessons of CI to create durable

networks that can strengthen practices

 Identify and explore emerging needs/fields  Create new products  Build platforms for ongoing collaboration  Identify and attack barriers

SLIDE 13

13 ¡

 A lot of innovative aspects of system

 City-level sub-allocation of LIHTC  Super RFP  Collective responsibility for troubled projects through ISG  Predevelopment funders roundtable  Commitment to preservation (MPPI)  Learning from TOD experience elsewhere