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Greater Minnesota Housing Fund

Greater MN Housing Fund provided a construction loan for Park Place Apartments, a supportive housing development in Bemidji, Minn. Opened in October 2017, it includes 60 units for formerly homeless adults and serves individuals working hard to overcome addiction issues.

Investment

$5 million 10-year loan at 2%; originated in 2009

Rationale

Capital to ease the foreclosure crisis in greater Minnesota and for other high priority areas of affordable housing. Affordable housing is the building block of a successful statewide economy.

Returns

Financial Returns: The loan is on track for success. It repaid its first principal in 2016.

Social Impact: Starting in 2009, Greater Minnesota Housing Fund acquired and rehabbed 230 foreclosed houses. The properties were improved and re-sold as fresh, affordable homes to moderate-income families, helping to stabilize hard-hit communities beyond our metro. The organization has also used McKnight capital to grow; it now manages a $55 million affordable housing loan fund for projects statewide.

Metrics2016
Multifamily units preserved or constructed through revolving loan438
Single family units preserved or constructed through revolving loan55
Multi- and single family loans$15.5m

Lessons Learned

Given affordable rental housing demand exceeds the supply of rent-subsidized properties, Greater Minnesota Housing Fund is financing, rehabilitating, and preserving “naturally occurring” (i.e. non-subsidized) affordable housing. This economically challenging work provides tremendous promise and learning for foundation staff and housing advocates.

As of November 2017

Photo Credits: Greater Minnesota Housing Fund

Disclaimer of Endorsement: The McKnight Foundation does not endorse or recommend any commercial products, processes, or service providers.